Amended and Restated Mortgage


 Exhibit 10.3 
 NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION FROM ANY INSTRUMENT THAT TRANSFERS AN INTEREST IN REAL PROPERTY BEFORE IT
IS FILED FOR RECORDING IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER’S LICENSE NUMBER. 
 WHEN RECORDED OR FILED,
 
 PLEASE RETURN TO:  

Simpson Thacher & Bartlett LLP 
 909
Fannin Street, Suite 1475 
 Houston, Texas 77010 
 Attention: Linda Daugherty 

	
	
	  
	Space above for County Recorder’s Use


 AMENDED AND RESTATED MORTGAGE, DEED OF TRUST, ASSIGNMENT OF AS- 

EXTRACTED COLLATERAL, SECURITY AGREEMENT, FIXTURE FILING AND 
 FINANCING STATEMENT 
 FROM 

DUNE PROPERTIES, INC. 
 TO 
 GEORGE SERICE, AS TRUSTEE 

FOR THE BENEFIT OF 
 BANK OF MONTREAL 
 as Administrative Agent 

and the Other Secured Persons 






 A CARBON, PHOTOGRAPHIC, OR OTHER REPRODUCTION OF THIS INSTRUMENT IS SUFFICIENT AS A FINANCING STATEMENT.

 A POWER OF SALE HAS BEEN GRANTED IN THIS INSTRUMENT. IN CERTAIN STATES, A POWER OF SALE MAY ALLOW THE TRUSTEE OR THE MORTGAGEE TO TAKE
THE MORTGAGED PROPERTY AND SELL IT WITHOUT GOING TO COURT IN A FORECLOSURE ACTION UPON DEFAULT BY THE MORTGAGOR UNDER THIS INSTRUMENT. 

THIS INSTRUMENT CONTAINS AFTER-ACQUIRED PROPERTY PROVISIONS. 
 THIS INSTRUMENT SECURES PAYMENT OF FUTURE ADVANCES. 
 THIS INSTRUMENT COVERS PROCEEDS OF
MORTGAGED PROPERTY. 
 THIS INSTRUMENT COVERS “FIXTURES” AND “AS EXTRACTED COLLATERAL” (AND ACCOUNTS WITH RESPECT TO
SAME), AS EACH SUCH TERM IS DEFINED IN THE UNIFORM COMMERCIAL CODE. 
 THIS INSTRUMENT COVERS MINERALS AND OTHER SUBSTANCES OF VALUE
WHICH MAY BE EXTRACTED FROM THE EARTH (INCLUDING WITHOUT LIMITATION OIL AND GAS) AND THE ACCOUNTS RELATED THERETO, WHICH WILL BE FINANCED AT THE WELLHEADS OF THE WELL OR WELLS LOCATED ON THE PROPERTIES DESCRIBED IN THE EXHIBIT HERETO. THIS FINANCING
STATEMENT IS TO BE FILED OR FILED FOR RECORD, AMONG OTHER PLACES, IN THE REAL ESTATE RECORDS OR SIMILAR RECORDS OF THE RECORDERS OF THE COUNTIES OR PARISHES LISTED ON THE EXHIBIT HERETO. THE MORTGAGOR HAS AN INTEREST OF RECORD IN THE REAL ESTATE AND
IMMOVABLE PROPERTY CONCERNED, WHICH INTEREST IS DESCRIBED IN THE EXHIBIT ATTACHED HERETO. 
 PORTIONS OF THE MORTGAGED PROPERTY ARE GOODS
WHICH ARE OR ARE TO BECOME AFFIXED TO OR FIXTURES ON THE LAND DESCRIBED IN OR REFERRED TO IN THE EXHIBIT HERETO. THIS FINANCING STATEMENT IS TO BE FILED FOR RECORD OR RECORDED, AMONG OTHER PLACES, IN THE REAL ESTATE RECORDS OR SIMILAR RECORDS OF
EACH COUNTY OR PARISH IN WHICH SAID LAND OR ANY PORTION THEREOF IS LOCATED. THE MORTGAGOR IS THE OWNER OF RECORD INTEREST IN THE REAL ESTATE CONCERNED. THIS INSTRUMENT IS ALSO TO BE INDEXED IN THE INDEX OF FINANCING STATEMENTS OR THE UCC RECORDS.







 TABLE OF CONTENTS 

 

							
	 	 	 	  	Page	 
	 ARTICLE I
 DEFINITIONS
	   

  

			
	 Section 1.01
	 	Terms Defined Above	  	 	2	  
	 Section 1.02
	 	UCC and Other Defined Terms	  	 	2	  
	 Section 1.03
	 	Definitions	  	 	2	  
	
	 ARTICLE II
 GRANT OF LIEN AND SECURED OBLIGATIONS
	   

  

			
	 Section 2.01
	 	Grant of Liens	  	 	5	  
	 Section 2.02
	 	Grant of Security Interest	  	 	7	  
	 Section 2.03
	 	Secured Obligations	  	 	7	  
	 Section 2.04
	 	Fixture Filing, Etc.	  	 	8	  
	 Section 2.05
	 	Pro Rata Benefit	  	 	8	  
	
	 ARTICLE III
 ASSIGNMENT OF AS-EXTRACTED COLLATERAL
	   

  

			
	 Section 3.01
	 	Assignment	  	 	8	  
	 Section 3.02
	 	No Modification of Payment Obligations	  	 	10	  
	 Section 3.03
	 	Rights and Title of Consignee	  	 	10	  
	
	 ARTICLE IV
 REPRESENTATIONS, WARRANTIES AND COVENANTS
	   

  

			
	 Section 4.01
	 	Title	  	 	10	  
	 Section 4.02
	 	Defend Title	  	 	10	  
	 Section 4.03
	 	Not a Foreign Person	  	 	11	  
	 Section 4.04
	 	Revenue and Cost Bearing Interest	  	 	11	  
	 Section 4.05
	 	Rentals Paid; Leases in Effect	  	 	11	  
	 Section 4.06
	 	Failure to Perform	  	 	11	  
	
	 ARTICLE V
 RIGHTS AND REMEDIES
	   

  

			
	 Section 5.01
	 	Event of Default	  	 	11	  
	 Section 5.02
	 	Foreclosure and Sale	  	 	11	  
	 Section 5.03
	 	Substitute Trustees and Agents	  	 	13	  
	 Section 5.04
	 	Judicial Foreclosure; Receivership	  	 	13	  
	 Section 5.05
	 	Foreclosure for Installments	  	 	13	  
	 Section 5.06
	 	Separate Sales	  	 	14	  
	 Section 5.07
	 	Possession of Mortgaged Property	  	 	14	  
	 Section 5.08
	 	Occupancy After Foreclosure	  	 	14	  


  
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	 Section 5.09
	 	Remedies Cumulative, Concurrent and Nonexclusive	  	 	15	  
	 Section 5.10
	 	Discontinuance of Proceedings	  	 	15	  
	 Section 5.11
	 	No Release of Obligations	  	 	15	  
	 Section 5.12
	 	Release of and Resort to Collateral	  	 	15	  
	 Section 5.13
	 	Waiver of Redemption, Notice and Marshalling of Assets, Etc.	  	 	16	  
	 Section 5.14
	 	Application of Proceeds	  	 	16	  
	 Section 5.15
	 	Resignation of Operator	  	 	16	  
	 Section 5.16
	 	Indemnity	  	 	17	  
	
	 ARTICLE VI
 THE TRUSTEE
	   

  

			
	 Section 6.01
	 	Duties, Rights, and Powers of Trustee	  	 	17	  
	 Section 6.02
	 	Successor Trustee	  	 	18	  
	 Section 6.03
	 	Retention of Moneys	  	 	18	  
	
	 ARTICLE VII
 MISCELLANEOUS
	   

  

			
	 Section 7.01
	 	Instrument Construed as Mortgage, Etc.	  	 	18	  
	 Section 7.02
	 	Releases	  	 	19	  
	 Section 7.03
	 	Severability	  	 	19	  
	 Section 7.04
	 	Successors and Assigns	  	 	19	  
	 Section 7.05
	 	Satisfaction of Prior Encumbrance	  	 	20	  
	 Section 7.06
	 	Application of Payments to Certain Obligations	  	 	20	  
	 Section 7.07
	 	Nature of Covenants	  	 	20	  
	 Section 7.08
	 	Notices	  	 	20	  
	 Section 7.09
	 	Counterparts	  	 	20	  
	 Section 7.10
	 	Governing Law	  	 	20	  
	 Section 7.11
	 	Financing Statement; Fixture Filing	  	 	21	  
	 Section 7.12
	 	Execution of Financing Statements	  	 	21	  
	 Section 7.13
	 	Exculpation Provisions	  	 	22	  
	 Section 7.14
	 	References	  	 	22	  
	 Section 7.15
	 	Amendment, Restatement	  	 	22	  
	 Section 7.16
	 	Secured Swap Agreements	  	 	22	  
	 Section 7.17
	 	Integration	  	 	22	  
	
	 ARTICLE VIII
 STATE SPECIFIC PROVISIONS
	   

  

			
	 Section 8.01
	 	State Specific Provisions Generally	  	 	23	  
	 Section 8.02
	 	Special Louisiana Provisions	  	 	23	  

 Exhibit A – Oil and Gas Properties 

  
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 THIS AMENDED AND RESTATED MORTGAGE, DEED OF TRUST, ASSIGNMENT OF AS-EXTRACTED COLLATERAL,
SECURITY AGREEMENT, FIXTURE FILING AND FINANCING STATEMENT (this “Mortgage”) is entered into as of December 22, 2011 (the “Effective Date”) by DUNE PROPERTIES, INC., a Texas corporation (the
“Mortgagor”), in favor of (i) GEORGE SERICE, as Trustee for the benefit of BANK OF MONTREAL, as Administrative Agent (together with its successors and assigns, the “Mortgagee”), and the Other Secured Persons
with respect to all Mortgaged Properties located in or adjacent to the Deed of Trust State and (ii) the Mortgagee for its benefit and the benefit of the Other Secured Parties with respect to all Mortgaged Properties located in or adjacent to
each Mortgage State and with respect to all UCC Collateral. 
 R E C I T A L S 

A. Dune Energy, Inc., a Delaware corporation, and Dune Properties, Inc., a Texas corporation, collectively with Dune Energy, Inc. as
borrowers, Wells Fargo Capital Finance, Inc., as administrative agent, and Wayzata Opportunities Fund II, L.P., as sole lender, are party to that certain Amended and Restated Credit Agreement, dated as of December 7, 2010 (as amended or
otherwise modified from time to time through the date hereof, the “WF Credit Agreement”). 
 B. The Mortgagor
entered into those certain mortgages dated as of May 15, 2007 and May 31, 2007 (as amended or otherwise modified from time to time through the date hereof) in favor of Wells Fargo Capital Finance, Inc., as administrative agent, which have
been recorded in the jurisdictions and are more particularly described in Exhibit A (the “Existing Mortgages”) to secure, inter alia, the obligations of the Mortgagor under the WF Credit Agreement. 

C. Mortgagor, as borrower, the Lenders, the Mortgagee, as administrative agent for the Lenders and others, have executed an Amended and
Restated Credit Agreement of even date herewith (such agreement, as may from time to time be amended, restated or supplemented, the “Credit Agreement”) pursuant to which, upon the terms and conditions stated therein, the Lenders
agreed to make loans and other extensions of credit to the Mortgagor. 
 D. The Mortgagor has requested and the Mortgagee has
agreed to amend and restate the Existing Mortgages and to extend the obligations outstanding thereunder, subject to the terms and conditions of the Credit Agreement. This Mortgage amends, restates and consolidates the Existing Mortgages to secure,
inter alia, the Mortgagor’s obligations under the Credit Agreement 
 E. The Mortgagor and certain Lenders or
Affiliates of Lenders have or may enter into certain ISDA Master Agreements, confirmations and other contractual arrangements, whether or not evidenced pursuant to standard ISDA documentation (any such agreements or instruments with Lenders or their
Affiliates collectively, “Swap Documents”) to evidence one or more swap, forward, future, put, call, physical delivery contract or other exchange or derivative transactions or options or similar agreements, whether exchange traded,
“over-the-counter” or otherwise, involving, or settled by reference to, one or more rates, currencies, commodities (including electricity), equity or debt instruments or securities, or economic, financial or pricing indices or measures of
economic, financial or pricing risk or value or any similar transaction or any combination of these transactions (collectively, “Swap Agreements”). 






 F. The Mortgagor and certain Lenders or Affiliates of Lenders have or may enter into certain
agreements regarding bank services provided to the Mortgagor and/or one or more of its Subsidiaries for commercial credit cards, stored value cards and treasury management services, including, without limitation, controlled disbursement, automated
clearinghouse transactions, return items, overdrafts and interstate depository network services (collectively, the “Cash Management Agreements”). 
 G. The Mortgagor, each of the signatories thereto and the Mortgagee have executed a Guarantee and Collateral Agreement (such agreement, as may from time to time be amended, restated or supplemented, the
“Guarantee”) of even date herewith pursuant to which, upon the terms and conditions stated therein, the Mortgagor and each of the other signatories thereto have agreed to grant a security interest to the Mortgagee in certain assets
specified therein and each of the signatories thereto have agreed to guarantee the obligations of the Mortgagor under the Credit Agreement, the Swap Agreements and the Cash Management Agreements (the Credit Agreement, the Swap Agreements, the Cash
Management Agreements and the Guarantee collectively being the “Secured Transaction Documents”). 
 H.
Therefore, in order to comply with the terms and conditions of the Secured Transaction Documents and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Mortgagor hereby agrees as follows:

 ARTICLE I 
 DEFINITIONS 
 Section 1.01 Terms Defined Above. As used
in this Mortgage, each term defined above has the meaning indicated above. 
 Section 1.02 UCC and Other Defined
Terms. Each capitalized term used in this Mortgage and not defined in this Mortgage shall have the meaning ascribed to such term in the Credit Agreement. Any capitalized term not defined in either this Mortgage or the Credit Agreement shall have
the meaning assigned to such term in the Applicable UCC. 
 Section 1.03 Definitions. 

“Applicable UCC” means the provisions of the Uniform Commercial Code presently in effect in the jurisdiction in which
the relevant UCC Collateral is situated or which otherwise is applicable to the creation or perfection of the Liens described herein or the rights and remedies of Mortgagee under this Mortgage. 

“Collateral” means collectively all the Mortgaged Property and all the UCC Collateral (but shall exclude any Excluded
Property). 
 “Deed of Trust State” has the meaning assigned such term in Section 2.01. 

“Event of Default” has the meaning assigned to such term in Section 5.01. 

  
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 “Excluded Property” means (a) any Equipment subject to a purchase
money security interest or equipment lease (“Encumbered Equipment”) if and to the extent that the creation of a security interest in the right, title or interest of the Grantor in the Encumbered Equipment would cause or result in a default
under any contractual provision or other restriction; (b) any rights or interest in any contract, license, permit or franchise covering real or personal property of the Grantor if, under the terms of the contract, license, permit or franchise
or applicable law, the grant of a security interest or other Lien therein is prohibited as a matter of Law, or under the terms of the contract, license, permit or franchise and that prohibition has not been effectively waived or the consent of the
other party(ies) to such contract, license, permit or franchise has not been obtained, but the foregoing exclusions in no way will be construed (i) to apply to the extent that any described prohibition is unenforceable under Section 9-406,
9-407, 9-408, or 9-409 of the UCC (as same may be limited by other applicable Law) or other applicable Law, or (ii) to limit, impair or otherwise affect the continuing security interests of the Secured Creditors in and Liens upon any rights or
interests of the Grantors in or to (A) monies due or to become due under any described contract, license, permit or franchise (including any Accounts), or (B) any proceeds from the sale, license, lease, or other dispositions of any such
contract or license; (c) leasehold interests; (d) assets subject to certificates of title; (e) “intent to use” trademark applications; and (f) assets as to which the Administrative Agent and the Borrower reasonably
agree that the cost of obtaining a security interest or perfection thereof is excessive in relation to the benefit to the Lenders of the security afforded thereby. 
 “Future Advances” means future obligations and future advances that the Mortgagee or any Other Secured Person may make pursuant to any Secured Transaction Document. 

“Hydrocarbon Interests” means all rights, titles, interests and estates and the lands and premises covered or affected
thereby now or hereafter acquired by the Mortgagor in and to oil and gas leases, oil, gas and mineral leases, or other liquid or gaseous hydrocarbon leases, fee interests, surface interests, mineral fee interests, overriding royalty and royalty
interests, net profit interests and production payment interests, including any reserved or residual interests of whatever nature, in each case, which are described on Exhibit A; provided that, it is the intent of the Mortgagor that all of its
interests be subject to the Lien of this Mortgage even if (i) its interests on Exhibit A shall be incorrectly described or a description of a part or all of such property or the Mortgagor’s interests therein be omitted or limited to
particular lands, specified depths or particular types of property interests or (ii) such properties or interests may be hereafter acquired. 
 “Hydrocarbons” means all oil, gas, casinghead gas, drip gasoline, natural gasoline, condensate, distillate, liquid hydrocarbons, gaseous hydrocarbons and all products refined or separated
therefrom and all other minerals which may be produced and saved from or attributable to the Oil and Gas Properties of the Mortgagor, including all oil in tanks, and all rents, issues, profits, proceeds, products, revenues and other incomes from or
attributable to the Hydrocarbon Interests or other properties constituting Oil and Gas Properties. 
 “Indemnified
Parties” means the Trustee, the Mortgagee, each Other Secured Person and their officers, directors, employees, representatives, agents, attorneys, accountants and experts. 

  
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 “Lien” means any interest in property securing an obligation owed to, or a
claim by, a Person other than the owner of the property, whether such interest is based on the common law, statute or contract, and whether such obligation or claim is fixed or contingent, and including but not limited to (a) the lien or
security interest arising from a mortgage, encumbrance, pledge, security agreement, conditional sale or trust receipt or a lease, consignment or bailment for security purposes or (b) production payments and the like payable out of Oil and Gas
Properties. 
 “Mortgaged Property” means the Oil and Gas Properties and other properties and assets described
in Section 2.01(a) through Section 2.01(e). 
 “Mortgage State” has the meaning ascribed such term in
Section 2.01. 
 “Oil and Gas Properties” means (a) Hydrocarbon Interests; (b) the properties
now or hereafter pooled or unitized with Hydrocarbon Interests; (c) all presently existing or future unitization, communitization, pooling agreements and declarations of pooled units and the units created thereby (including without limitation
all units created under orders, regulations and rules of any Governmental Authority) which may affect all or any portion of the Hydrocarbon Interests; (d) all operating agreements, production sales or other contracts, farmout agreements,
farm-in agreements, area of mutual interest agreements, equipment leases and other agreements which relate to any of the Hydrocarbon Interests or any interests therein or to the production, sale, purchase, exchange, processing, handling, storage,
transporting or marketing of the Hydrocarbons from or attributable to such Oil and Gas Properties; (e) all Hydrocarbons; (f) all tenements, hereditaments, appurtenances and properties in any manner appertaining, belonging, affixed or
incidental to the Hydrocarbon Interests, including all compressor sites, settling ponds and equipment or pipe yards; and (g) all properties, rights, titles, interests and estates described or referred to above whether now owned or hereinafter
acquired, including any and all property, real or personal, immoveable or moveable, situated upon, used, held for use or useful in connection with the operating, working or development of any of such Hydrocarbon Interests or property (excluding
drilling rigs, automotive equipment, rental equipment or other personal property which may be on such premises for the purpose of drilling a well or for other similar temporary uses) and including any and all oil wells, gas wells, injection wells or
other wells, fuel separators, liquid extraction plants, plant compressors, pumps, pumping units, pipelines, sales and flow lines, gathering systems, field gathering systems, salt water disposal facilities, tanks and tank batteries, fixtures, valves,
fittings, machinery and parts, engines, boilers, steam generation facilities, meters, apparatus, equipment, appliances, tools, implements, cables, wires, towers, casing, tubing and rods, surface leases, rights-of-way, easements, servitudes licenses
and other surface and subsurface rights, together with all additions, substitutions, replacements, accessions and attachments to any and all of the foregoing. 
 “Other Secured Persons” means each Lender, each Agent under the Credit Agreement, each Issuing Bank under the Credit Agreement, each Lender or Affiliate of a Lender which is party to any
Treasury Management Agreement, each Lender or Affiliate of a Lender which is party to any Secured Swap Agreement or was a Lender or an Affiliate of a Lender on the Effective Date, each Indemnified Party and any legal owner, holder, assignee or
pledgee of any of the Secured Obligations. 
 “Paid In Full In Cash” means (i) the payment in full in cash
of all principal, interest (including interest accruing during the pendency of an insolvency or liquidation proceeding, regardless of whether allowed or allowable in such insolvency or liquidation proceeding) and premium, if any, on all Loans
outstanding under the Credit Agreement, (ii) the payment in full in 

  
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cash or posting of cash collateral in respect of all other obligations or amounts that are outstanding under the Credit Agreement (other than amounts in respect of indemnification, expense,
reimbursement, yield protection or tax gross-up for which no claim has been made), including the posting of cash collateral for outstanding Letters of Credit as required by the terms of the Credit Agreement, (iii) the termination of all
Commitments under the Credit Agreement, (iv) payment in full in cash of all amounts owed under and the termination of all obligations under each Treasury Management Agreement (other than amounts in respect of indemnification, expense,
reimbursement, yield protection or tax gross-up for which no claim has been made), and (v) the termination of all Secured Swap Agreements or the posting of acceptable substitute collateral to the counterparty to such Secured Swap Agreements as
required by the terms thereof or the novation of such Secured Swap Agreements to third parties. 
 “Permitted
Encumbrances” means all Liens permitted to be placed on the Mortgaged Properties under Section 9.03 of the Credit Agreement. 
 “Post-Default Rate” means the post-default rate per annum set forth in Section 3.02(c) of the Credit Agreement applicable to past due payments, but in no event to exceed the Highest
Lawful Rate. 
 “Secured Obligations” has the meaning assigned to such term in Section 2.03. 

“Trustee” means GEORGE SERICE of Houston, Harris County, Texas, whose address for notice hereunder is 700 Louisiana,
Suite 2100, Houston, TX 77002 and any successors and substitutes in trust hereunder. 
 “UCC Collateral” means
the property and other assets described in Section 2.02. 
 ARTICLE II 

GRANT OF LIEN AND SECURED OBLIGATIONS 
 Section 2.01 Grant of Liens. To secure payment of the Secured Obligations, the Mortgagor does by these presents hereby: 

(i) GRANT, BARGAIN, SELL, ASSIGN, MORTGAGE, TRANSFER and CONVEY to the Trustee, for the use and benefit of the Mortgagee and the Other
Secured Persons, all the following properties, rights and interests (as described in subsections (a) through (e) immediately below) which are located in (or cover or relate to such Oil and Gas Properties located in) or offshore of the
state of Texas (the “Deed of Trust State”), TO HAVE AND TO HOLD unto the Trustee forever to secure the Secured Obligations; and 
 (ii) GRANT, BARGAIN, SELL, WARRANT, MORTGAGE, ASSIGN, TRANSFER, PLEDGE, HYPOTHECATE and CONVEY to the Mortgagee, for its benefit and the benefit of the Other Secured Persons, with mortgage covenants, and
upon the statutory mortgage condition for the breach of which this Mortgage may be subject to foreclosure as provided by applicable law, all the following properties, rights and interests which are located in or offshore Louisiana (the
“Mortgage State”): 
 (a) All rights, titles, interests and estates now owned or hereafter
acquired by the Mortgagor in and to the Oil and Gas Properties described on Exhibit A. 

  
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 (b) All rights, titles, interests and estates now owned or hereafter
acquired by the Mortgagor in and to all geological, geophysical, engineering, accounting, title, legal and other technical or business data concerning the Oil and Gas Properties, the Hydrocarbons or any other item of property which are in the
possession of the Mortgagor, and all books, files, records, magnetic media, computer records and other forms of recording or obtaining access to such data. 
 (c) All rights, titles, interests and estates now owned or hereafter acquired by the Mortgagor in and to all Hydrocarbons. 

(d) Any property that may from time to time hereafter, by delivery or by writing of any kind, be subjected to the Liens
hereof by the Mortgagor or by anyone on the Mortgagor’s behalf; and the Trustee and/or the Mortgagee are hereby authorized to receive the same at any time as additional security hereunder. 

(e) All of the rights, titles and interests of every nature whatsoever now owned or hereafter acquired by the Mortgagor in
and to the Oil and Gas Properties described in Exhibit A and all other rights, titles, interests and estates and every part and parcel thereof, including, without limitation, any rights, titles, interests and estates as the same may be enlarged by
the discharge of any payments out of production or by the removal of any charges or Permitted Encumbrances to which any of such Oil and Gas Properties or other rights, titles, interests or estates are subject or otherwise; all rights of the
Mortgagor to Liens securing payment of proceeds from the sale of production from any of such Oil and Gas Properties, together with any and all renewals and extensions of any of such related rights, titles, interests or estates; all contracts and
agreements supplemental to or amendatory of or in substitution for the contracts and agreements described or mentioned above; and any and all additional interests of any kind hereafter acquired by the Mortgagor in and to such related rights, titles,
interests or estates. 
 TO HAVE AND TO HOLD the foregoing properties, rights and interests unto the Trustee and Mortgagee (and
their respective successors and assigns), as the case may be, upon the terms and conditions of this Mortgage. 
 Any fractions
or percentages specified on Exhibit A in referring to the Mortgagor’s interests are solely for purposes of the warranties made by the Mortgagor pursuant to Section 4.01 and Section 4.04 and shall in no manner limit the quantum of
interest affected by this Section 2.01 with respect to any Oil and Gas Property or with respect to any unit or well identified on Exhibit A. 
 Notwithstanding any provision in this Mortgage to the contrary, in no event (x) is any Building (as defined in the applicable Flood Insurance Regulation) or Manufactured (Mobile) Home (as defined in
the applicable Flood Insurance Regulation) included in the definition of “Mortgage Property” and no Building or Manufactured (Mobile) Home is hereby encumbered by this Mortgage and (y) is any Excluded Property included in the
definition of Mortgaged Property and no Excluded Property is hereby encumbered by this Mortgage. As used herein, “Flood 

  
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Insurance Regulations” shall mean (i) the National Flood Insurance Act of 1968 as now or hereafter in effect or any successor statute thereto, (ii) the Flood Disaster Protection
Act of 1973 as now or hereafter in effect or any successor statute thereto, (iii) the National Flood Insurance Reform Act of 1994 (amending 42 USC 4001, et. seq.), as the same may be amended or recodified from time to time, and (iv) the
Flood Insurance Reform Act of 2004 and any regulations promulgated thereunder. 
 Section 2.02 Grant of Security
Interest. To further secure the Secured Obligations, the Mortgagor hereby grants to the Mortgagee, for its benefit and the benefit of the Other Secured Persons, a security interest in and to all of the following (whether now or hereafter
acquired by operation of law or otherwise): 
 (a) all As-Extracted Collateral from or attributable to the Oil
and Gas Properties; 
 (b) all Fixtures; 

(c) all Hydrocarbons; 
 (d) all books and records pertaining to the Oil and Gas Properties; and 
 (e) to the extent not otherwise included, all Proceeds and products of any and all of the foregoing and all collateral security, and guarantees given with respect to any of the foregoing. 

Notwithstanding any provision in this Mortgage to the contrary, in no event is any Excluded Property included in the grant of any security interest
pursuant to this Mortgage and no Excluded Property is hereby encumbered by this Mortgage. 
 Section 2.03 Secured
Obligations. This Mortgage is executed and delivered by the Mortgagor to secure and enforce the following (the “Secured Obligations”): 
 (a) Payment of and performance of any and all indebtedness, fees, interest, indemnities, reimbursements, obligations and liabilities of Borrower or any Guarantor (including interest accruing during the
pendency of an insolvency or liquidation proceeding, regardless of whether allowed or allowable in such insolvency or liquidation proceeding) pursuant to the Credit Agreement, the Guarantee, this Mortgage or any other Loan Document, whether now
existing or hereafter arising and being in the original principal amount of Two Hundred Million United States Dollars (US $200,000,000) with final maturity on or before December 22, 2015, including performance of all Letter of Credit Agreements
executed from time to time by the Borrower or any Subsidiary of the Borrower under or pursuant to the Credit Agreement and all reimbursement obligations for drawn or undrawn portions under any Letter of Credit now outstanding or hereafter issued
under or pursuant to the Credit Agreement. 
 (b) Any sums which may be advanced or paid by the Trustee or the
Mortgagee or any Other Secured Person under the terms hereof or of the Credit Agreement or any Secured Transaction Document on account of the failure of the Mortgagor or any of its Subsidiaries to comply with the covenants of the Mortgagor contained
herein, in the Credit Agreement or any other Secured Transaction Document and all other obligations, liabilities and indebtedness of the Mortgagor or any other Guarantor arising pursuant to the provisions of this Mortgage or any Secured Transaction
Document. 

  
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 (c) Any additional loans made by the Mortgagee or any Lender to the Borrower
or any other Guarantor. It is contemplated that the Mortgagee and the Lenders may lend additional sums to the Borrower from time to time, but shall not be obligated to do so, and the Mortgagor agrees that any such additional loans shall be secured
by this Mortgage. 
 (d) Payment of and performance of any and all present or future obligations of the Mortgagor
under any Secured Swap Document or any Secured Swap Agreement, including any deferred premiums in respect of puts, floors or options constituting Secured Swap Agreements. 

(e) Payment of and performance of any and all present or future obligations, whether absolute or contingent and howsoever
and whensoever created, arising, evidenced or acquired, of the Mortgagor and any of its Subsidiaries under any Cash Management Agreements. 
 (f) Any and all renewals, modifications, substitutions, rearrangements or extensions of any of the foregoing, whether in whole or in part. 

Section 2.04 Fixture Filing, Etc. Without in any manner limiting the generality of any of the other provisions of this
Mortgage: (i) some portions of the goods described or to which reference is made herein are or are to become Fixtures on the land described or to which reference is made herein or on Exhibit A; (ii) the security interests created hereby
under applicable provisions of the Applicable UCC will attach to all As-Extracted Collateral (all minerals including oil and gas and the Accounts resulting from the sale thereof at the wellhead or minehead located on the Oil and Gas Properties
described or to which reference is made herein or on Exhibit A) and all other Hydrocarbons; (iii) this Mortgage is to be filed of record in the real estate records or other appropriate records as a financing statement; and (iv) the
Mortgagor is the record owner of the real estate or interests in the real estate or immoveable property comprised of the Mortgaged Property. 
 Section 2.05 Pro Rata Benefit . This Mortgage is executed and granted for the pro rata benefit and security of the Mortgagee and the Other Secured Persons to secure the Secured
Obligations for so long as same remains unpaid and thereafter until the Secured Obligations have been Paid In Full In Cash. 

ARTICLE III 

ASSIGNMENT OF AS-EXTRACTED COLLATERAL 
 Section 3.01 Assignment. 
 (a) Provided that the
Mortgagor shall have the rights permitted under clause (b) below, the Mortgagor has absolutely and unconditionally assigned, transferred, conveyed and granted a security interest, and does hereby absolutely and unconditionally assign, transfer,
convey and grant a security interest unto the Mortgagee in and to: 

  
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 (i) all of its As-Extracted Collateral located in or relating to the
Mortgaged Properties located in the county where this Mortgage is filed, including without limitation, all As-Extracted Collateral relating to the Hydrocarbon Interests, the Hydrocarbons and all products obtained or processed therefrom; 

(ii) the revenues and proceeds now and hereafter attributable to such Mortgaged Properties, including the Hydrocarbons,
and said products and all payments in lieu, such as “take or pay” payments or settlements; and 
 (iii)
all amounts and proceeds hereafter payable to or to become payable to the Mortgagor or now or hereafter relating to any part of such Mortgaged Properties and all amounts, sums, monies, revenues and income which become payable to the Mortgagor from,
or with respect to, any of the Mortgaged Properties, present or future, now or hereafter constituting a part of the Hydrocarbon Interests. 
 (b) The Hydrocarbons and products are to be delivered into pipe lines connected with the Mortgaged Property, or to the purchaser thereof, to the credit of the Mortgagee, for its benefit and the benefit of
the Other Secured Persons, free and clear of all taxes, charges, costs and expenses; and, subject to the following sentence, all such revenues and proceeds shall be paid directly to the Mortgagee, at its offices in Houston, Texas, with no duty or
obligation of any party paying the same to inquire into the rights of the Mortgagee to receive the same, what application is made thereof, or as to any other matter. Notwithstanding anything to the contrary contained herein, so long as no Event of
Default shall have occurred and is continuing, Mortgagor shall have the right to collect all revenues and proceeds attributable to the Hydrocarbons that accrue to the Oil and Gas Properties or the products obtained or processed therefrom, as well as
any Liens and security interests securing any sales of said Hydrocarbons and to retain, use and enjoy same. 

(c) Subject to the last sentence of clause (b) above, the Mortgagor agrees to perform all such acts, and to execute
all such further assignments, transfers and division orders and other instruments as may be required or desired by the Mortgagee or any party in order to have said proceeds and revenues so paid to the Mortgagee. In addition to any and all rights of
a secured party under Sections 9.607 and 9.609 of the Applicable UCC, and subject to clause (b) above, the Mortgagee is fully authorized to receive and receipt for said revenues and proceeds; to endorse and cash any and all checks and drafts
payable to the order of the Mortgagor or the Mortgagee for the account of the Mortgagor received from or in connection with said revenues or proceeds and to hold the proceeds thereof in a Deposit Account with the Mortgagee, a Lender or other
acceptable commercial bank as additional collateral securing the Secured Obligations; and to execute transfer and division orders in the name of the Mortgagor, or otherwise, with warranties binding the Mortgagor. All proceeds received by the
Mortgagee pursuant to this grant and assignment shall be applied as provided in Section 5.14. 
 (d) The
Mortgagee shall not be liable for any delay, neglect or failure to effect collection of any proceeds or to take any other action in connection therewith or hereunder; but the Mortgagee shall have the right, at its election, in the name of the
Mortgagor or otherwise, to prosecute and defend any and all actions or legal proceedings deemed advisable by the Mortgagee in order to collect such funds and to protect the interests of the Mortgagee and/or the Mortgagor, with all costs, expenses
and attorneys’ fees incurred in connection therewith being paid by the Mortgagor. 

  
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 (e) The Mortgagor hereby appoints the Mortgagee as its attorney-in-fact
solely in order to pursue any and all rights of the Mortgagor to Liens in the Hydrocarbons securing payment of proceeds of runs attributable to the Hydrocarbons. In addition to the Liens granted to the Trustee and/or the Mortgagee in
Section 2.01(e), the Mortgagor hereby further transfers and assigns to the Mortgagee any and all such Liens, security interests, financing statements or similar interests of the Mortgagor attributable to its interest in the As-Extracted
Collateral, any other Hydrocarbons and proceeds of runs therefrom arising under or created by said statutory provision, judicial decision or otherwise. The power of attorney granted to the Mortgagee in this Section 3.01, being coupled with an
interest, shall be irrevocable until the Secured Obligations have been Paid In Full In Cash. 
 Section 3.02 No
Modification of Payment Obligations. Nothing herein contained shall modify or otherwise alter the obligation of the Mortgagor to make prompt payment of all amounts constituting Secured Obligations when and as the same become due regardless of
whether the proceeds of the As-Extracted Collateral and Hydrocarbons are sufficient to pay the same and the rights provided in accordance with the foregoing assignment provision shall be cumulative of all other security of any and every character
now or hereafter existing to secure payment of the Secured Obligations. Nothing in this Article III is intended to be an acceptance of collateral in satisfaction of the Secured Obligations. 

Section 3.03 Rights and Title of Consignee. In addition to the rights, titles and interests hereby conveyed pursuant
to Section 2.01, the Mortgagor hereby grants to the Mortgagee those Liens given to interest owners of Hydrocarbons to secure the obligations of purchasers at the wellhead, including those rights provided in Tex. Bus. & Com. Code Ann.
§9.343 (Vernon Supp. 1989) (“Tex. UCC”), as amended from time to time. 
 ARTICLE IV 

REPRESENTATIONS, WARRANTIES AND COVENANTS 
 The Mortgagor hereby represents, warrants and covenants as follows: 

Section 4.01 Title. To the extent of the undivided interests specified on Exhibit A, the Mortgagor has good and
defensible title to and is possessed of the Hydrocarbon Interests and has good title to the UCC Collateral, in both instances except for Permitted Encumbrances. 
 Section 4.02 Defend Title. This Mortgage is, and always will be kept, a direct first priority Lien upon the Collateral; provided that Permitted Encumbrances may exist, but no intent to
subordinate the priority of the Liens created hereby is intended or inferred by such existence. The Mortgagor will warrant and defend the title to the Collateral against the claims and demands of all other Persons whomsoever and will maintain and
preserve the Lien created hereby (and its priority) until the Secured Obligations shall be Paid In Full In Cash. If (i) an adverse claim be made against or a cloud develop upon the title to any part of the Collateral other than a Permitted
Encumbrance or (ii) any Person, including the holder of a Permitted Encumbrance, shall challenge the priority or validity of the Liens created by this Mortgage, then the Mortgagor agrees to promptly defend against such adverse claim, take
appropriate action to remove such cloud or subordinate such Permitted Encumbrance, in each case, at the Mortgagor’s sole cost and expense. 

  
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 Section 4.03 Not a Foreign Person. The Mortgagor is not a “foreign
person” within the meaning of the Code, Sections 1445 and 7701 (i.e. the Mortgagor is not a non-resident alien, foreign corporation, foreign partnership, foreign trust or foreign estate as those terms are defined in the Code and any regulations
promulgated thereunder). 
 Section 4.04 Revenue and Cost Bearing Interest. The Mortgagor’s ownership of
the undivided interests in the wells specified on Exhibit A will, after giving full effect to all Permitted Encumbrances, afford the Mortgagor not less than those net interests (expressed as a fraction, percentage or decimal) in the production from
or which is allocated to such undivided interests specified as Net Revenue Interest (as specified on Exhibit A) on attached Exhibit A except for periods in which the Mortgagor has elected to not participate in well operations (which allows other
owners to recoup a multiple of their costs of participation before the Mortgagor will again be entitled to receive its share of production) and will cause the Mortgagor to bear not more than that portion (expressed as a fraction, percentage or
decimal), specified as Working Interest on Exhibit A, of the costs of drilling, developing and operating the wells identified on Exhibit A except to the extent of any proportionate corresponding increase in the Net Revenue Interest. 

Section 4.05 Rentals Paid; Leases in Effect. Except as otherwise set forth in the Credit Agreement or as could not
reasonably be expected to have a Material Adverse Effect, all rentals and royalties due and payable in accordance with the terms of any leases or subleases comprising a part of the Mortgaged Property have been duly paid or provided for, and all
leases or subleases comprising a part of the Oil and Gas Property are in full force and effect. 
 Section 4.06
Failure to Perform. The Mortgagor agrees that if it fails to perform any act or to take any action which it is required to perform or take hereunder or pay any money which the Mortgagor is required to pay hereunder, each of the Mortgagee and
the Trustee, in the Mortgagor’s name or its or their own name, may, but shall not be obligated to, perform or cause to perform such act or take such action or pay such money, and any expenses so incurred by either of them and any money so paid
by either of them shall be a demand obligation owing by the Mortgagor to the Mortgagee or the Trustee, as the case may be, and each of the Mortgagee and the Trustee, upon making such payment, shall be subrogated to all of the rights of the Person
receiving such payment. Each amount due and owing by the Mortgagor to each of the Mortgagee and the Trustee pursuant to this Mortgage shall bear interest from the date of such expenditure or payment to such Person until paid at the Post-Default
Rate. 
 ARTICLE V 
 RIGHTS AND REMEDIES 
 Section 5.01 Event of Default. An
Event of Default under the Credit Agreement shall be an “Event of Default” under this Mortgage. 

Section 5.02 Foreclosure and Sale. 

  
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 (a) If an Event of Default shall occur and be continuing, to the extent
provided by applicable law, the Mortgagee shall have the right and option to proceed with foreclosure by: (i) with respect to that portion of the Mortgaged Property located in or adjacent to any Deed of Trust State directing the Trustee to
proceed, and (ii) with respect to that portion of the Mortgaged Property located in or adjacent to any Mortgage State proceeding, with foreclosure and to sell all or any portion of such Mortgaged Property at one or more sales, as an entirety or
in parcels, at such place or places in otherwise such manner and upon such notice as may be required by law, or, in the absence of any such requirement, as the Mortgagee may deem appropriate, and to make conveyance to the purchaser or purchasers.
Where the Mortgaged Property is situated in more than one jurisdiction, notice as above provided shall be posted and filed in all such jurisdictions (if such notices are required by law), and all such Mortgaged Property may be sold in any such
jurisdiction and any such notice shall designate the jurisdiction where such Mortgaged Property is to be sold. Nothing contained in this Section 5.02 shall be construed so as to limit in any way any rights to sell the Mortgaged Property or any
portion thereof by private sale if and to the extent that such private sale is permitted under the laws of the applicable jurisdiction or by public or private sale after entry of a judgment by any court of competent jurisdiction so ordering. The
Mortgagor hereby irrevocably appoints the Trustee and the Mortgagee, with full power of substitution, to be the attorneys-in-fact of the Mortgagor and in the name and on behalf of the Mortgagor solely in order to execute and deliver any deeds,
transfers, conveyances, assignments, assurances and notices which the Mortgagor ought to execute and deliver and do and perform any and all such acts and things which the Mortgagor ought to do and perform under the covenants herein contained and
generally, to use the name of the Mortgagor in the exercise of all or any of the powers hereby conferred on the Trustee and/or the Mortgagee. At any such sale: (i) whether made under the power herein contained or any other legal enactment, or
by virtue of any judicial proceedings or any other legal right, remedy or recourse, it shall not be necessary for the Trustee or the Mortgagee, as appropriate, to have physically present, or to have constructive possession of, the Mortgaged Property
(the Mortgagor hereby covenanting and agreeing to deliver any portion of the Mortgaged Property not actually or constructively possessed by the Trustee or the Mortgagee immediately upon his or its demand) and the title to and right of possession of
any such property shall pass to the purchaser thereof as completely as if the same had been actually present and delivered to purchaser at such sale, (ii) each instrument of conveyance executed by the Trustee or the Mortgagee shall contain a
general warranty of title, binding upon the Mortgagor and its successors and assigns, (iii) each and every recital contained in any instrument of conveyance made by the Trustee or the Mortgagee shall conclusively establish the truth and
accuracy of the matters recited therein, including, without limitation, nonpayment of the Secured Obligations, advertisement and conduct of such sale in the manner provided herein and otherwise by law and appointment of any successor trustee
hereunder, (iv) any and all prerequisites to the validity thereof shall be conclusively presumed to have been performed, (v) the receipt of the Trustee, the Mortgagee or such other party or officer making the sale shall be a sufficient
discharge to the purchaser or purchasers for its purchase money and no such purchaser or purchasers, or its assigns or personal representatives, shall thereafter be obligated to see to the application of such purchase money, or be in any way
answerable for any loss, misapplication or nonapplication thereof, (vi) to the fullest extent permitted by law, the Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, claim and demand whatsoever, either
at law or in equity, in and to the property sold and such sale shall be a perpetual bar both at law and in equity against the Mortgagor, and 

  
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against any and all other persons claiming or to claim the property sold or any part thereof, by, through or under the Mortgagor, and (vii) to the extent and under such circumstances as are
permitted by law, the Mortgagee may be a purchaser at any such sale, and shall have the right, after paying or accounting for all costs of said sale or sales, to credit the amount of the bid upon the amount of the Secured Obligations (in the order
of priority set forth in Section 5.14) in lieu of cash payment. 
 (b) If an Event of Default shall occur
and be continuing, then (i) the Mortgagee shall be entitled to all of the rights, powers and remedies afforded a secured party by the Applicable UCC with reference to the UCC Collateral or (ii) the Trustee or the Mortgagee may proceed as
to any Collateral in accordance with the rights and remedies granted under this Mortgage or applicable law in respect of the Collateral. Such rights, powers and remedies shall be cumulative and in addition to those granted to the Trustee or the
Mortgagee under any other provision of this Mortgage or under any other Loan Document or any Secured Transaction Document. Written notice mailed to the Mortgagor as provided herein at least ten (10) days prior to the date of public sale of any
part of the Collateral which is personal property subject to the provisions of the Applicable UCC, or prior to the date after which private sale of any such part of the Collateral will be made, shall constitute reasonable notice. 

Section 5.03 Substitute Trustees and Agents. The Trustee or Mortgagee may appoint or delegate any one or more persons
as agent to perform any act or acts necessary or incident to any sale held by the Trustee or Mortgagee, including the posting of notices and the conduct of sale, but in the name and on behalf of the Trustee or Mortgagee. If the Trustee or Mortgagee
shall have given notice of sale hereunder, any successor or substitute trustee or mortgagee agent thereafter appointed may complete the sale and the conveyance of the property pursuant thereto as if such notice had been given by the successor or
substitute trustee or mortgagee agent conducting the sale. 
 Section 5.04 Judicial Foreclosure;
Receivership. If any of the Secured Obligations shall become due and payable and shall not be promptly paid, the Trustee or the Mortgagee shall have the right and power to proceed by a suit or suits in equity or at law, whether for the specific
performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, or for any foreclosure hereunder or for the sale of the Collateral under the judgment or decree of any court or courts of competent
jurisdiction, or for the appointment of a receiver pending any foreclosure hereunder or the sale of the Collateral under the order of a court or courts of competent jurisdiction or under executory or other legal process, or for the enforcement of
any other appropriate legal or equitable remedy. Any money advanced by the Trustee and/or the Mortgagee in connection with any such receivership shall be a demand obligation (which obligation the Mortgagor hereby expressly promises to pay) owing by
the Mortgagor to the Trustee and/or the Mortgagee and shall bear interest from the date of making such advance by the Trustee and/or the Mortgagee until paid at the Post-Default Rate. 

Section 5.05 Foreclosure for Installments. The Mortgagee shall also have the option to proceed with foreclosure in
satisfaction of any installments of the Secured Obligations which have not been paid when due either through the courts or by directing the Trustee to proceed with foreclosure in satisfaction of the matured but unpaid portion of the Secured
Obligations as if under a full foreclosure, conducting the sale as herein provided and without declaring the entire 

  
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principal balance and accrued interest and other Secured Obligations then due; such sale may be made subject to the unmatured portion of the Secured Obligations, and any such sale shall not in
any manner affect the unmatured portion of the Secured Obligations, but as to such unmatured portion of the Secured Obligations this Mortgage shall remain in full force and effect just as though no sale had been made hereunder. It is further agreed
that several sales may be made hereunder without exhausting the right of sale for any unmatured part of the Secured Obligations, it being the purpose hereof to provide for a foreclosure and sale of the security for any matured portion of the Secured
Obligations without exhausting the power to foreclose and sell the Mortgaged Property for any subsequently maturing portion of the Secured Obligations. 
 Section 5.06 Separate Sales. The Collateral may be sold in one or more parcels and to the extent permitted by applicable law in such manner and order as the Mortgagee, in its sole
discretion, may elect, it being expressly understood and agreed that the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales. 
 Section 5.07 Possession of Mortgaged Property. If an Event of Default shall have occurred and be continuing, then, to the extent permitted by applicable law, the Trustee or the
Mortgagee shall have the right and power to enter into and upon and take possession of all or any part of the Collateral in the possession of the Mortgagor, its successors or assigns, or its or their agents or servants, and may exclude the
Mortgagor, its successors or assigns, and all persons claiming under the Mortgagor, and its or their agents or servants wholly or partly therefrom; and, holding the same, the Mortgagee may use, administer, manage, operate and control the Collateral
and conduct the business thereof to the same extent as the Mortgagor, its successors or assigns, might at the time do and may exercise all rights and powers of the Mortgagor, in the name, place and stead of the Mortgagor, or otherwise as the
Mortgagee shall deem best. All costs, expenses and liabilities of every character incurred by the Trustee and/or the Mortgagee in administering, managing, operating, and controlling the Mortgaged Property shall constitute a demand obligation (which
obligation the Mortgagor hereby expressly promises to pay) owing by the Mortgagor to the Trustee and/or the Mortgagee and shall bear interest from date of expenditure until paid at the Post-Default Rate. 

Section 5.08 Occupancy After Foreclosure. In the event there is a foreclosure sale hereunder and at the time of such
sale the Mortgagor or the Mortgagor’s heirs, devisees, representatives, successors or assigns or any other person claiming any interest in the Collateral by, through or under the Mortgagor, are occupying or using the Mortgaged Property or any
part thereof, each and all shall immediately become the tenant of the purchaser at such sale, which tenancy shall be a tenancy from day to day, terminable at the will of either the landlord or tenant, or at a reasonable rental per day based upon the
value of the property occupied, such rental to be due daily to the purchaser; to the extent permitted by applicable law, the purchaser at such sale shall, notwithstanding any language herein apparently to the contrary, have the sole option to demand
immediate possession following the sale or to permit the occupants to remain as tenants at will. In the event the tenant fails to surrender possession of said property upon demand, the purchaser shall be entitled to institute and maintain a summary
action for possession of the Mortgaged Property (such as an action for forcible entry and detainer) in any court having jurisdiction. 

  
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 Section 5.09 Remedies Cumulative, Concurrent and Nonexclusive. Every
right, power, privilege and remedy herein given to the Trustee or the Mortgagee shall be cumulative and in addition to every other right, power and remedy herein specifically given or now or hereafter existing in equity, at law or by statute
(including specifically those granted by the Applicable UCC in effect and applicable to the Collateral or any portion thereof). Each and every right, power, privilege and remedy whether specifically herein given or otherwise existing may be
exercised from time to time and so often and in such order as may be deemed expedient by the Trustee or the Mortgagee, and the exercise, or the beginning of the exercise, or the abandonment, of any such right, power, privilege or remedy shall not be
deemed a waiver of the right to exercise, at the same time or thereafter any other right, power, privilege or remedy. No delay or omission by the Trustee or the Mortgagee or any Other Secured Person in the exercise of any right, power or remedy
shall impair any such right, power, privilege or remedy or operate as a waiver thereof or of any other right, power, privilege or remedy then or thereafter existing. 
 Section 5.10 Discontinuance of Proceedings. If the Trustee or the Mortgagee shall have proceeded to invoke any right, remedy or recourse permitted hereunder or under any Secured
Transaction Document or available at law and shall thereafter elect to discontinue or abandon same for any reason, then it shall have the unqualified right so to do and, in such an event, the parties shall be restored to their former positions with
respect to the Secured Obligations, this Mortgage, the Credit Agreement, the Collateral and otherwise, and the rights, remedies, recourses and powers of the Trustee and the Mortgagee, as applicable, shall continue as if same had never been invoked.

 Section 5.11 No Release of Obligations. Neither the Mortgagor, any Guarantor nor any other person
hereafter obligated for payment of all or any part of the Secured Obligations shall be relieved of such obligation by reason of: (a) the failure of the Trustee to comply with any request of the Mortgagor, or any Guarantor or any other Person so
obligated to foreclose the Lien of this Mortgage or to enforce any provision hereunder or under the Credit Agreement; (b) the release, regardless of consideration, of the Mortgaged Property or any portion thereof or interest therein or the
addition of any other property to the Mortgaged Property; (c) any agreement or stipulation between any subsequent owner of the Mortgaged Property and the Mortgagee extending, renewing, rearranging or in any other way modifying the terms of this
Mortgage without first having obtained the consent of, given notice to or paid any consideration to the Mortgagor, any Guarantor or such other Person, and in such event the Mortgagor, Guarantor and all such other persons shall continue to be liable
to make payment according to the terms of any such extension or modification agreement unless expressly released and discharged in writing by the Mortgagee; or (d) by any other act or occurrence save and except if the Secured Obligations are
Paid In Full In Cash and any other obligations hereunder or under the Credit Agreement are completely fulfilled. 

Section 5.12 Release of and Resort to Collateral. The Mortgagee may release, regardless of consideration, any part of
the Collateral without, as to the remainder, in any way impairing, affecting, subordinating or releasing the Lien created in or evidenced by this Mortgage or its stature as a first and prior Lien in and to the Collateral, and without in any way
releasing or diminishing the liability of any Person liable for the repayment of the Secured Obligations. For payment of the Secured Obligations, the Mortgagee may resort to any other security therefor held by the Mortgagee or the Trustee in such
order and manner as the Mortgagee may elect. 

  
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 Section 5.13 Waiver of Redemption, Notice and Marshalling of Assets, Etc.
To the fullest extent permitted by law, the Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefits that might accrue to the Mortgagor by virtue of any present or future moratorium law or other law exempting the
Collateral from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (b) all notices of any Event of Default or of the
Mortgagee’s or any other secured Person’s intention to accelerate maturity of the Secured Obligations or of any election to exercise or any actual exercise of any right, remedy or recourse provided for hereunder or under any Secured
Transaction Document or available at law; and (c) any right to a marshalling of assets or a sale in inverse order of alienation. If any law referred to in this Mortgage and now in force, of which the Mortgagor or its successor or successors
might take advantage despite the provisions hereof, shall hereafter be repealed or cease to be in force, such law shall thereafter be deemed not to constitute any part of the contract herein contained or to preclude the operation or application of
the provisions hereof. If the laws of any state which provides for a redemption period do not permit the redemption period to be waived, the redemption period shall be specifically reduced to the minimum amount of time allowable by statute.

 Section 5.14 Application of Proceeds. The proceeds of any sale of the Mortgaged Property or any part
thereof and all other monies received in any proceedings for the enforcement hereof or otherwise, whose application has not elsewhere herein been specifically provided for, shall be applied: 

(a) First, to the payment of all reasonable expenses incurred by the Trustee or the Mortgagee incident to the enforcement
of this Mortgage, the Credit Agreement or any Secured Transaction Document to collect any portion of the Secured Obligations (including, without limiting the generality of the foregoing, expenses of any entry or taking of possession, of any sale, of
advertisement thereof, and of conveyances, and court costs, compensation of agents and employees, legal fees and a reasonable commission to the Trustee acting, if applicable), and to the payment of all other reasonable charges, expenses, liabilities
and advances incurred or made by the Trustee or the Mortgagee under this Mortgage or in executing any trust or power hereunder; and 
 (b) Second, as set forth in Section 10.02(c) of the Credit Agreement. 

Section 5.15 Resignation of Operator. In addition to all rights and remedies under this Mortgage, at law and in
equity, if any Event of Default shall occur and the Trustee or the Mortgagee shall exercise any remedies under this Mortgage with respect to any portion of the Mortgaged Property (or the Mortgagor shall transfer any Mortgaged Property “in lieu
of” foreclosure) whereupon the Mortgagor is divested of its title to any of the Collateral, the Mortgagee shall have the right to request that any operator of any Mortgaged Property which is either the Mortgagor or any Affiliate of the
Mortgagor to resign as operator under the joint operating agreement applicable thereto, and no later than 60 days after receipt by the Mortgagor of any such request, the Mortgagor shall resign (or cause such other Person to resign) as operator of
such Collateral. 

  
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 Section 5.16 Indemnity. THE INDEMNIFIED PARTIES SHALL NOT BE LIABLE, IN
CONNECTION WITH ANY ACTION TAKEN, FOR ANY LOSS SUSTAINED BY THE MORTGAGOR RESULTING FROM AN ASSERTION THAT THE MORTGAGEE HAS RECEIVED FUNDS FROM THE PRODUCTION OF HYDROCARBONS CLAIMED BY THIRD PERSONS OR ANY ACT OR OMISSION OF ANY INDEMNIFIED PARTY
IN ADMINISTERING, MANAGING, OPERATING OR CONTROLLING THE MORTGAGED PROPERTY INCLUDING SUCH LOSS WHICH MAY RESULT FROM THE ORDINARY NEGLIGENCE OF AN INDEMNIFIED PARTY UNLESS SUCH LOSS IS CAUSED BY THE WILLFUL MISCONDUCT OR GROSS NEGLIGENCE OF
THE INDEMNIFIED PARTY SEEKING INDEMNITY. NO INDEMNIFIED PARTY WILL BE OBLIGATED TO PERFORM OR DISCHARGE ANY OBLIGATION, DUTY OR LIABILITY OF THE MORTGAGOR. THE MORTGAGOR SHALL AND DOES HEREBY AGREE TO INDEMNIFY EACH INDEMNIFIED PARTY FOR, AND TO
HOLD EACH INDEMNIFIED PARTY HARMLESS FROM, ANY AND ALL LIABILITY, LOSS OR DAMAGE WHICH MAY OR MIGHT BE INCURRED BY ANY INDEMNIFIED PARTY BY REASON OF THIS MORTGAGE OR THE EXERCISE OF RIGHTS OR REMEDIES HEREUNDER. IF ANY INDEMNIFIED PARTY SHALL MAKE
ANY EXPENDITURE ON ACCOUNT OF ANY SUCH LIABILITY, LOSS OR DAMAGE, THE AMOUNT THEREOF, INCLUDING COSTS, EXPENSES AND REASONABLE ATTORNEYS’ FEES, SHALL BE A DEMAND OBLIGATION (WHICH OBLIGATION THE MORTGAGOR HEREBY EXPRESSLY PROMISES TO PAY) OWING
BY THE MORTGAGOR TO SUCH INDEMNIFIED PARTY AND SHALL BEAR INTEREST FROM THE DATE EXPENDED UNTIL PAID AT THE POST-DEFAULT RATE. THE MORTGAGOR HEREBY ASSENTS TO, RATIFIES AND CONFIRMS ANY AND ALL ACTIONS OF EACH INDEMNIFIED PARTY WITH RESPECT TO THE
MORTGAGED PROPERTY TAKEN UNDER AND IN COMPLIANCE WITH THE TERMS OF THIS MORTGAGE. THE LIABILITIES OF THE MORTGAGOR AS SET FORTH IN THIS SECTION 5.16 SHALL SURVIVE THE TERMINATION OF THIS MORTGAGE. 

ARTICLE VI 

THE TRUSTEE 
 Section 6.01 Duties, Rights, and Powers of Trustee. The Trustee shall have no duty to see to any recording, filing or registration of this Mortgage or any other instrument in addition
or supplemental thereto, or to give any notice thereof, or to see to the payment of or be under any duty in respect of any tax or assessment or other governmental charge which may be levied or assessed on the Mortgaged Property, or any part thereof,
or against the Mortgagor, or to see to the performance or observance by the Mortgagor of any of the covenants and agreements contained herein. The Trustee shall not be responsible for the execution, acknowledgment or validity of this Mortgage or of
any instrument in addition or supplemental hereto or for the sufficiency of the security purported to be created hereby, and makes no representation in respect thereof or in respect of the rights of the Mortgagee. The Trustee shall have the right to
advise with counsel upon any matters arising hereunder and shall be fully protected in relying as to legal matters on the advice of counsel. The Trustee shall not incur any personal liability hereunder except for the Trustee’s own willful
misconduct; and the Trustee shall have the right to rely on any instrument, document or signature authorizing or supporting any action taken or proposed to be taken by him hereunder, believed by him in good faith to be genuine. 

  
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 Section 6.02 Successor Trustee. The Trustee may resign by written notice
addressed to the Mortgagee or be removed at any time with or without cause by an instrument in writing duly executed on behalf of the Mortgagee. In case of the death, resignation or removal of the Trustee, a successor may be appointed by the
Mortgagee by instrument of substitution complying with any applicable Governmental Requirements, or, in the absence of any such requirement, without formality other than appointment and designation in writing. Written notice of such appointment and
designation shall be given by the Mortgagee to the Mortgagor, but the validity of any such appointment shall not be impaired or affected by failure to give such notice or by any defect therein. Such appointment and designation shall be full evidence
of the right and authority to make the same and of all the facts therein recited. Upon the making of any such appointment and designation, this Mortgage shall vest in the successor all the estate and title in and to all of the Mortgaged Property in
or adjacent to any Deed of Trust State, and the successor shall thereupon succeed to all of the rights, powers, privileges, immunities and duties hereby conferred upon the Trustee named herein, and one such appointment and designation shall not
exhaust the right to appoint and designate an additional successor but such right may be exercised repeatedly until the Secured Obligations are Paid In Full In Cash. To facilitate the administration of the duties hereunder, the Mortgagee may appoint
multiple trustees to serve in such capacity or in such jurisdictions as the Mortgagee may designate. 
 Section 6.03
Retention of Moneys. All moneys received by the Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated in any manner from any other moneys (except to
the extent required by law) and the Trustee shall be under no liability for interest on any moneys received by him hereunder. 

ARTICLE VII 

MISCELLANEOUS 
 Section 7.01 Instrument Construed as Mortgage, Etc. With respect to any portions of the Mortgaged Property located in or adjacent to any State or other jurisdiction the laws of which do
not provide for the use or enforcement of a deed of trust or the office, rights and authority of the Trustee as herein provided, the general language of conveyance hereof to the Trustee is intended and the same shall be construed as words of
mortgage unto and in favor of the Mortgagee and the rights and authority granted to the Trustee herein may be enforced and asserted by the Mortgagee in accordance with the laws of the jurisdiction in which such portion of the Mortgaged Property is
located and the same may be foreclosed at the option of the Mortgagee as to any or all such portions of the Mortgaged Property in any manner permitted by the laws of the jurisdiction in which such portions of the Mortgaged Property is situated. This
Mortgage may be construed as a mortgage, deed of trust, conveyance, assignment, security agreement, fixture filing, pledge, financing statement, hypothecation or contract, or any one or more of them, in order fully to effectuate the Lien hereof and
the purposes and agreements herein set forth. 

  
 -18-








 Section 7.02 Releases. 

(a) Full Release. If all Secured Obligations (other than amounts in respect of indemnification, expense,
reimbursement, yield protection or tax gross-up for which no claim has been made) shall be Paid In Full In Cash, the Mortgagee shall forthwith cause satisfaction and discharge of this Mortgage to be entered upon the record at the expense of the
Mortgagor and shall execute and deliver or cause to be executed and delivered such instruments of satisfaction and reassignment as may be appropriate. Otherwise, this Mortgage shall remain and continue in full force and effect. 

(b) Partial Release. If any of the Mortgaged Property shall be sold, transferred or otherwise disposed of by the
Mortgagor in a transaction permitted by the Credit Agreement, then the Mortgagee, at the request and sole expense of the Mortgagor, shall promptly execute and deliver to the Mortgagor all releases, re-conveyances or other documents reasonably
necessary or desirable for the release of the Liens created hereby on the Mortgaged Property. At the request and sole expense of the Mortgagor, the Mortgagor shall be released from its obligations hereunder in the event that all of the Equity
Interests of the Mortgagor shall be sold, transferred or otherwise disposed of in a transaction permitted by the Credit Agreement; provided that the Mortgagor shall have delivered to the Mortgagee, at least five Business Days prior to the date of
the proposed release, a written request of a Responsible Officer of the Mortgagor for release identifying the terms of the sale or other disposition in reasonable detail, including the price thereof and any expenses in connection therewith, together
with a certification by the Mortgagor stating that such transaction is in compliance with the Credit Agreement and the other Loan Documents. 
 (c) Possession of Notes. The Mortgagor acknowledges and agrees that possession of any Note (or any replacements of any said Note or other instrument evidencing any part of the Secured Obligations)
at any time by the Mortgagor or any other guarantor shall not in any manner extinguish the Secured Obligations or this Mortgage, and the Mortgagor shall have the right to issue and reissue any of the Notes from time to time as its interest or as
convenience may require, without in any manner extinguishing or affecting the Secured Obligations or the Lien of this Mortgage. 

Section 7.03 Severability. If any provision hereof is invalid or unenforceable in any jurisdiction, the other
provisions hereof shall remain in full force and effect in such jurisdiction and the remaining provisions hereof shall be liberally construed in favor of the Trustee, the Mortgagee and the Other Secured Persons in order to effectuate the provisions
hereof. The invalidity or unenforceability of any provision hereof in any jurisdiction shall not affect the validity or enforceability of any such provision in any other jurisdiction. 

Section 7.04 Successors and Assigns. The terms used to designate any party or group of persons shall be deemed to
include the respective heirs, legal representatives, successors and assigns of such Persons. 

  
 -19-








 Section 7.05 Satisfaction of Prior Encumbrance. To the extent that
proceeds of the Credit Agreement are used to pay indebtedness secured by any outstanding Lien against the Mortgaged Property then the Mortgagor acknowledges and agrees that: (a) such proceeds have been advanced at the Mortgagor’s request,
and (b) the Mortgagee and the Lenders shall be subrogated to any and all rights and Liens owned by any owner or holder of such outstanding Liens, irrespective of whether said Liens are or have been released. It is expressly understood that, in
consideration of the payment of such other indebtedness, the Mortgagor hereby waives and releases all demands and causes of action for offsets and payments to, upon and in connection with the said indebtedness. This Mortgage is made with full
substitution and subrogation of the Trustee and the Mortgagee and his successors in this trust and his and their assigns in and to all covenants and warranties by others heretofore given or made in respect of the Mortgaged Property or any part
thereof. 
 Section 7.06 Application of Payments to Certain Obligations. If any part of the Secured
Obligations cannot be lawfully secured by this Mortgage or if any part of the Mortgaged Property cannot be lawfully subject to the Lien hereof to the full extent of the Secured Obligations, then all payments made shall be applied on said Secured
Obligations first in discharge of that portion thereof which is not secured by this Mortgage. 
 Section 7.07
Nature of Covenants. The covenants and agreements herein contained shall constitute covenants running with the land and interests covered or affected hereby and shall be binding upon the heirs, legal representatives, successors and assigns of
the parties hereto. 
 Section 7.08 Notices. All notices, requests, consents, demands and other
communications required or permitted hereunder shall be in writing and shall be deemed sufficiently given or furnished if delivered by registered or certified United States mail, postage prepaid, or by personal service (including express or courier
service) at the addresses specified in Section 7.12 (unless changed by similar notice in writing given by the particular party whose address is to be changed). Any such notice or communication shall be deemed to have been given either at the
time of personal delivery or, in the case of delivery at the address and in the manner provided herein, upon receipt; provided that, service of notice as required by the laws of any state in which portions of the Mortgaged Property may be situated
shall for all purposes be deemed appropriate and sufficient with the giving of such notice. 
 Section 7.09
Counterparts. This Mortgage is being executed in several counterparts, all of which are identical, except that to facilitate recordation, if the Mortgaged Property is situated in more than one county or parish, descriptions of only those
portions of the Mortgaged Property located in the county or parish in which a particular counterpart is recorded shall be attached as Exhibit A to such counterpart. Each of such counterparts shall for all purposes be deemed to be an original and all
such counterparts shall together constitute but one and the same instrument. Complete copies of this Mortgage containing the entire Exhibit A have been retained by the Mortgagee. 

Section 7.10 Governing Law. Insofar as permitted by otherwise applicable law, this Mortgage shall be construed under
and governed by the laws of the State of Texas; provided, however, that, with respect to any portion of the Mortgaged Property located outside of the State of Texas, the laws of the place in which such property is located shall apply to the extent
of procedural and substantive matters relating only to the creation, perfection, foreclosure of Liens and enforcement of rights and remedies against the Mortgaged Property. 

  
 -20-








 Section 7.11 Financing Statement; Fixture Filing. This Mortgage shall be
effective as a financing statement filed as a fixture filing with respect to all Fixtures included within the Mortgaged Property and is to be filed or filed for record in the real estate records, mortgage records or other appropriate records of each
jurisdiction where any part of the Mortgaged Property (including said fixtures) are situated. This Mortgage shall also be effective as a financing statement covering As-Extracted Collateral (including oil and gas and all other substances of value
which may be extracted from the ground) and accounts financed at the wellhead or minehead of wells or mines located on the properties subject to the Applicable UCC and is to be filed for record in the real estate records, UCC records or other
appropriate records of each jurisdiction where any part of the Mortgaged Property is situated. 
 Section 7.12
Execution of Financing Statements. Pursuant to the Applicable UCC, the Mortgagor authorizes the Mortgagee, its counsel or its representative, at any time and from time to time, to file or record financing statements, continuation statements,
amendments thereto and other filing or recording documents or instruments with respect to the Mortgaged Property without the signature of the Mortgagee in such form and in such offices as the Mortgagee reasonably determines appropriate to perfect
the security interests of the Mortgagee under this Agreement. The Mortgagor also authorizes the Mortgagee, its counsel or its representative, at any time and from time to time, to file or record such financing statements that describe the collateral
covered thereby as “all assets of the Mortgagee”, “all personal property of the Mortgagee” or words of similar effect. The Mortgagor shall pay all costs associated with the filing of such instruments. 

In that regard, the following information is provided: 
  

			
	 Name of Debtor:
	  	Dune Properties, Inc.
	 Address of Debtor:
	  	Two Shell Plaza
		  	777 Walker Street, Suite 2300
		  	Houston, Texas 77002
	 Telephone:
	  	713-229-6300
	 Facsimile:
	  	713-229-6398
	 Attention:
	  	Richard H. Mourglia
	 Jurisdiction of formation:
	  	Texas
	 Organizational ID #:
	  	149826000
		
	Name of Secured Party:	  	Bank of Montreal
	 as Administrative Agent
	  	
	Address of Secured	  	 700 Louisiana, Suite 2100

	 Party:
	  	Houston, TX 77002
	 Attention:
	  	George Serice
	 Telephone:
	  	713-546-9723
	 Facsimile:
	  	713-223-4007
		
	Owner of Record of	  	
	 Real Property:
	  	Debtor


  
 -21-








 Section 7.13 Exculpation Provisions. EACH OF THE PARTIES HERETO
SPECIFICALLY AGREES THAT IT HAS A DUTY TO READ THIS MORTGAGE; AND AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS MORTGAGE; THAT IT HAS IN FACT READ THIS MORTGAGE AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF
THE TERMS, CONDITIONS AND EFFECTS OF THIS MORTGAGE; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF THIS MORTGAGE; AND HAS RECEIVED THE ADVICE OF ITS ATTORNEY IN ENTERING
INTO THIS MORTGAGE; AND THAT IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS MORTGAGE RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY FOR SUCH LIABILITY. EACH
PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS MORTGAGE ON THE BASIS THAT THE PARTY HAD NO NOTICE OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT
“CONSPICUOUS.” 
 Section 7.14 References. The words “herein,” “hereof,”
“hereunder” and other words of similar import when used in this Mortgage refer to this Mortgage as a whole, and not to any particular article, section or subsection. Any reference herein to a Section shall be deemed to refer to the
applicable Section of this Mortgage unless otherwise stated herein. Any reference herein to an exhibit or schedule shall be deemed to refer to the applicable exhibit or schedule attached hereto unless otherwise stated herein. 

Section 7.15 Amendment, Restatement. On the date hereof, the Existing Mortgages shall be amended and restated and
superseded in their entirety by this Mortgage. Mortgagor acknowledges and agrees that (a) this Mortgage does not constitute a novation, payment and reborrowing, or termination of the obligations secured by the Existing Mortgages, (b) such
obligations are in all respects continuing with only the terms thereof being modified as provided in the Credit Agreement, (c) the Liens described in the Existing Mortgages are carried forward and (d) none of the rights, titles and
interests existing and to exist under the Existing Mortgages are released, diminished or impaired. 
 Section 7.16
Secured Swap Agreements. If Secured Swap Agreements remain outstanding when the Indebtedness under the Credit Agreement have been Paid In Full In Cash, then the Liens created by this Mortgage shall not be terminated until all Secured Swap
Agreements between the Mortgagor and such Person or Persons are Paid In Full In Cash. 
 Section 7.17
Integration. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES HERETO AND THERETO AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. 

  
 -22-








 ARTICLE VIII 
 STATE SPECIFIC PROVISIONS 
 Section 8.01 State Specific
Provisions Generally. The state specific provisions detailed in this Article VIII apply to (1) Mortgaged Property located in that state and (2) UCC Collateral subject to the applicable law of that state. 

Section 8.02 Special Louisiana Provisions. 

(a) Multiple Indebtedness Mortgage/Maximum Amount. Insofar as any portion of the Mortgaged Property situated in or
offshore the State of Louisiana is concerned, or as to which the laws of the State of Louisiana would be applicable, THIS MORTGAGE IS MADE AND GRANTED PURSUANT TO THE PROVISIONS OF, AND SHALL BE ENTITLED TO THE CONTINUING PREFERENCE AND PRIORITY
PROVIDED BY, ARTICLE 3298 OF THE LOUISIANA CIVIL CODE, AND SHALL APPLY TO AND SECURE THE PAYMENT AND PERFORMANCE OF PAST, PRESENT AND FUTURE INDEBTEDNESS AS SAID TERM IS DEFINED IN CREDIT AGREEMENT AND THE MAXIMUM AMOUNT OF THE INDEBTEDNESS THAT MAY
BE OUTSTANDING AT ANY TIME AND FROM TIME TO TIME THAT THIS MORTGAGE SECURES IS FIXED AT FOUR HUNDRED MILLION AND 00/100 DOLLARS (US $400,000,000). 
 (b) Foreclosure and Sale. To the extent permitted by applicable law, the Mortgagor hereby waives (i) the benefit of appraisement provided for in articles 2332, 2336, 2723, and 2724 of the
Louisiana Code of Civil Procedure and all other laws conferring the same; (ii) the notice of seizure provided for in articles 2293 and 2721 of the Louisiana Code of Civil Procedure; (iii) the three (3) days delay provided for in
articles 2331 and 2722 of the Louisiana Code of Civil Procedure; and (iv) all other laws providing rights of notice, demand, appraisement, or delay. Pursuant to Louisiana Revised Statutes 9:5131-5135 and 9:5136-5140.2, in the event of the
Mortgaged Property or any part thereof is seized as an incident to an action for the recognition or enforcement of this Mortgage by executory process, ordinary process, sequestration, writ of fieri facias, or otherwise, Mortgagor agrees that the
Court issuing any such order, shall, if petitioned for by the Mortgagee, direct the applicable sheriff to appoint as a keeper of the Mortgaged Property the holder or any agent or other Person designated by holder at the time such seizure is
effected. Mortgagor agrees that such keeper shall be entitled to receive its compensation, in excess of its reasonable costs and expenses incurred in the administration or preservation of the Mortgaged Property to the extent permitted by applicable
law. The designation of a keeper made herein shall not be deemed to require the holder to provoke the appointment of such a keeper. 
 (c) Notary Public. The parties relieve and release the undersigned notary public of any duty to produce and attach mortgage or conveyance certificates. 

(d) No Paraph. Mortgagor acknowledges that no promissory note or other instrument has been presented to the
undersigned Notary Public(s) to be paraphed for identification herewith. 
 [SIGNATURES BEGIN NEXT PAGE] 

  
 -23-








 THUS DONE AND PASSED, before me, Notary Public, in Harris, County, Texas, in the presence of
witnesses on the              day of December, 2011, to be effective as of the          day of December, 2011. 

 

									
	WITNESSES:	 		 	DUNE PROPERTIES, INC.
				
	/s/ Linda Daugherty	 		 	By:	 	/s/ James A. Watt
	Name:	 	Linda Daugherty	 		 	Name:	 	James A. Watt
		 		 		 	Title:	 	President
				
	/s/ Peter W. Raish	 		 		 	
	Name:	 	Peter W. Raish	 		 		 	

  

	
	/s/ Sharon K. Barker
	Notary Public
	Seal:


  

			
	 STATE OF TEXAS
	  	§
		  	§
	 COUNTY OF HARRIS
	  	§

 This instrument was acknowledged before me the 21st day of December, 2011 by James A. Watt , President of
Dune Properties, Inc., a Texas corporation, on behalf of such corporation. 
  

	
	/s/ Sharon K. Barker
	Notary Public
	Seal: [Seal]



  
 -24-








 EXHIBIT A 
 to 
 AMENDED AND RESTATED MORTGAGE, DEED OF TRUST, 

ASSIGNMENT OF AS-EXTRACTED COLLATERAL, SECURITY AGREEMENT, 
 FIXTURE FILING AND FINANCING STATEMENT 
 Introduction 

The capitalized terms used but not defined in this Exhibit A are used as defined in the Mortgage. For purposes of this Exhibit A the
capitalized terms not defined in the Mortgage are as follows: 
  

	1.	“Working Interest” or “Gross Working Interest” and “W.I.” or “G.W.I.” means an interest owned in an oil, gas and mineral lease
that determines the cost bearing percentage of the owner of such interest. 

  

	2.	“Net Revenue Interest” or “N.R.I.” means an interest (expressed as a percentage or decimal fraction), determined net of all royalties, overriding
royalties, production payments or other burdens payable out of production, in and to all Hydrocarbons produced and saved from or attributable to a Well. In the case of any Well listed in Exhibit A, the Net Revenue Interest specified for such Well
shall mean the sum of the percentage or decimal fraction set forth after the words “Net Revenue Interest” in the portion applicable to such Well plus, in the case of any Well with respect to which a royalty interest and/or overriding
royalty is stated in this Exhibit A and applicable to such Well, the percentage or decimal fraction set forth after the words “Royalty Interest” or “Overriding Royalty Interest” in each such portion of Exhibit A.


  

	3.	“Before Payout” or “BPO” means the Working Interest and/or Net Revenue Interest of a party before the point in time when the Well has recovered from
production all costs as specified in underlying farmout, assignments or other documents in the chain of title, usually including costs of drilling, completing and equipping a well or wells plus costs of operating the well or wells during the
recoupment period. 

  

	4.	“After Payout” or “APO” means the Working Interest and/or Net Revenue Interest of a party after the point in time when the Well has recovered from
production all costs as specified in the underlying farmout, assignments or other documents in the chain of title, usually including costs of drilling, completing and equipping a well or wells plus costs of operating the well or wells during the
recoupment period. 

  

	5.	“Well” means (i) any existing well identified in Exhibit A, including replacement well drilled in lieu thereof from which gas is now or hereafter
produced and (ii) any well at any time producing or capable of producing gas attributable to the Hydrocarbons as defined above, including any well which has been shut-in, has temporarily ceased production or on which workover, reworking,
plugging and abandonment or other operations are being conducted or planned. 


  
 Exhibit
A-Page 1 







 All references contained in this Exhibit A to the Oil and Gas Properties are intended to
include references to (i) the volume or book and page, file, entry or instrument number of the appropriate records of the particular county or parish in the state where each such lease or other instrument is recorded and (ii) all valid and
existing amendments to such lease or other instrument of record in such county or parish records regardless of whether such amendments are expressly described herein. A special reference is here made to each such lease or other instrument and the
record thereof for a more particular description of the property and interests sought to be affected by the Mortgage and for all other purposes. 
 For recording purposes, in regards to each county or parish portion to this Exhibit A, this Introduction may be attached to an original executed copy of the Amended and Restated Mortgage, Deed of Trust,
Assignment of As-Extracted Collateral, Security Agreement, Fixture Filing and Financing Statement to be separately filed of record in each county or parish. 

  
 Exhibit
A-Page 2 







 ANNEX I 

1. Act of Mortgage, Fixture Filing, Assignment of As-Extracted Collateral, Security Agreement and Financing Statement from Goldking
Operating Company (predecessor of Dune Properties, Inc.), as Mortgager, for the benefit of Wells Fargo Foothill, Inc., as Mortgagee and Arranger and Administrative Agent. 

 

							
	 Parishes
	  	 Recordation
	  	Date Filed	 
	Calcasieu	  	Book 3358, Pg 333, Entry No. 2811583	  	 	05/17/07	  
	East Baton Rouge	  	Orig 391, Bndl 11951	  	 	05/17/07	  
	Iberia	  	Book 1195, Page 594, Entry No. 2007-000005535	  	 	05/16/07	  
	Iberville	  	Book 454, Entry No. 1, File No. 2222	  	 	05/17/07	  
	Jefferson Davis	  	Book 556, Page 876, File No. 628215	  	 	05/17/07	  
	Lafayette	  	File No. 2007-00021974	  	 	05/16/07	  
	Lafourche	  	Book 1257, Page 599, Inst. No. 1025662	  	 	05/16/07	  
	Plaquemines	  	Book 476, Page 549, File No. 2007-00002998	  	 	05/16/07	  
	St. Martin	  	Book 1108, Page 150, Inst. No. 399986	  	 	05/16/07	  
	St. Mary	  	Book 1125, Page 673, File No. 281805	  	 	05/16/07	  
	Terrebonne	  	Book 1981, Page 856, File No. 1266384	  			
	Vermilion	  	No. 20705758	  	 	05/16/07	  

 2. Deed of Trust, Mortgage, Fixture Filing, Assignment of As-Extracted Collateral, Security Agreement and
Financing Statement from Goldking Operating Company (predecessor of Dune Properties, Inc.), as Trustor, to Terry I. Cross, as the Trustee for the benefit of Wells Fargo Foothill, Inc. as Arranger and Administrative Agent. 

 

							
	 Counties
	  	 Recordation
	  	Date Filed	 
	Brazoria	  	No. 200727750	  	 	05/17/07	  
	Colorado	  	No. 2480. Vol. 558, Page 072	  	 	05/17/07	  
	Jackson	  	No. 65237, Vol. 304, Page 742	  	 	05/21/07	  
	Karnes	  	No. 00075268, Bk OR, Vol. 854, Page 438	  	 	05/17/07	  

 3. Deed of Trust, Mortgage, Fixture Filing, Assignment of As-Extracted Collateral, Security Agreement and
Financing Statement from Dune Energy, Inc., as Trustor, to Terry I. Cross, as the Trustee for the benefit of Wells Fargo Foothill, Inc. as Arranger and Administrative Agent. 

 

							
	 Counties
	  	 Recordation
	  	Date Filed	 
	Frio	  	No. 0118946, Vol. 0034, Page 491	  	 	05/18/07	  
	Zapata	  	No. 147326, Vol. 792, Page 281	  	 	05/17/07	  







 4. Act of Mortgage, Fixture Filing, Assignment of As-Extracted Collateral, Security
Agreement and Financing Statement from Dune Energy, Inc., as Mortgager, for the benefit of Wells Fargo Foothill, Inc., as Mortgagee and Arranger and Administrative Agent. 

 

							
	 Parishes
	  	 Recordation
	  	Date Filed	 
	St. Charles	  	Book 1213, Pg 95, File No. 330899	  	 	05/15/07