Document:

Security Agreement

  
 Exhibit 10.59

  
 SECURITY AGREEMENT 
 (PLEDGE) 
  

			
	 ENERGYTEC, INC.,
 a Nevada Corporation
	  	 AMERICAN BANK OF TEXAS

		
	 14785 Preston Road, Ste. 500
	  	 P. O. Box 1234

		
	 Dallas, Texas 75254
	  	 Sherman, Texas 75091-1234

		
	 (hereafter called “Borrower”)
	  	 (hereafter called “Lender”)

  
 The Lender and Borrower agree as
follows: 
  

	SECTION 	I. CREATION OF SECURITY INTEREST. 

  
 In order to secure a promissory note or notes of even date herewith executed by Borrower and made payable to Lender and all other indebtedness and
liabilities of all kinds of Borrower to Lender (whether created directly or acquired by Lender indirectly by assignment or otherwise, and whether now existing or hereafter arising, absolute or contingent, joint and/or several, due or to become due,
primary or secondary, and all renewals, extensions and rearrangements thereof), hereafter referred to as “Obligations,” Borrower grants to Lender a security interest in the following described property that is herewith pledged to Lender.

  
 AMERICAN BANK OF TEXAS DEPOSITORY ACCOUNT NO. 2688755 HELD BY
ENERGYTEC, INC. 
  
 together with all payments thereon, proceeds therefrom,
interest, profits, or other accretions arising therefrom and all substitutions therefor; all of which are hereafter referred to as “Collateral.” Notwithstanding the above, this Security Agreement will not secure an obligation of Borrower
covered by the Truth-in-Lending Act unless the document or disclosure statement that evidences such transaction indicates by proper disclosure that the subject transaction is secured by this Security Agreement. 
  

	SECTION 	II. BORROWER’S REPRESENTATIONS AND WARRANTIES. 

  
 Borrower Represents and Warrants to Lender That: 
  
 (1) Borrower is duly organized and existing under the laws of the State of Nevada and is duly qualified and in good standing in every other State in which
it is doing business; and the execution, delivery, and performance of this Agreement and the Obligations secured hereby are within Borrower’s corporate powers, have been duly authorized, are not in contravention of law or the terms of
Borrower’s articles of incorporation, by-laws, or other incorporation papers, or of any indenture, agreement, or undertaking to which Borrower is a party or by which it is bound; 
  
 (2) All documents, instruments, chattel paper and any similar property delivered to Lender as Collateral are genuine and
free from adverse claims or other security interest, default, prepayment or defenses, and comply with applicable laws concerning form, content, manner of preparation and execution; all persons appearing to be obligated thereon have authority and
capacity to contract and are bound thereon as they appear to be from the face thereof; 
  
 (3) There is no lien, security interest or other encumbrance on or any restriction on the transferability of the Collateral covered by this Agreement at the time of execution of this Agreement. Borrower owns the
Collateral and has the right to transfer full legal interest therein to Lender, and the Collateral is not subject to any interest of any third party; 
  
 (4) Borrower’s principal place of business is the address shown at the beginning of this Agreement; 
  
 (5) All information contained in statements furnished or to be furnished
Lender by or on behalf of Borrower in connection with the Obligation secured by this Agreement is complete and accurate in all respects; 
  
 (6) If any part of the Collateral is stock issued by a corporation, that the purchase price of such stock has been paid in full. 
  

	SECTION 	III. COLLATERAL PROCEDURES. 

  
 (1) Lender will hold all Collateral deposited with it and will receive and hold payments thereon, proceeds therefrom, interest, profits, dividends and
other accretions arising from the Collateral (hereafter called “Payment Items”). Borrower shall immediately deliver to Lender any such Payment Items that are distributed or paid to Borrower. Lender may notify those liable for any of the
Payment Items to make payment of any amounts due thereon direct to Lender, Lender shall have the right to vote any of the Collateral held by it, and Borrower shall execute any and all instruments necessary in order to appoint Lender as
Borrower’s proxy. 
  
 (2) Borrower shall take all required
steps for the collection of the Collateral, shall do everything necessary to preserve rights against prior parties to instruments, documents or paper constituting the Collateral, and shall be responsible generally for its preservation. Lender will
be under no obligation to undertake such collection and shall be responsible only for exercising reasonable care in the custody and preservation of the Collateral. However, if it so desires, Lender will have the right to undertake the collection of
all or any part of the Collateral, and for this purpose will have the right to endorse on behalf of and in the name of Borrower any of the Collateral items and to give receipts therefor in Borrower’s name. Lender may at any time apply any of
the cash or cash equivalent Collateral against any or all of the Obligations in any manner Lender may select. Lender will have the right to transfer any or all of the Collateral into its own name or that of its nominee, and Lender may thereupon
exercise all rights and privileges to which it will thereupon become entitled, but it will be under no duty to exercise such rights and privileges. In the event Lender finds it necessary to bring a collection suit, Borrower agrees that Lender may
bring said suit in Borrower’s name. 
  
 (3) Lender may accept
additions to or substitutions for any or all of the Collateral, may release or deliver any or all of the Collateral to Borrower, and may release or compromise with anyone liable on any of the Collateral - all without affecting Lender’s rights
in any of the Collateral retained or the liability of any maker, endorser or guarantor or any of the Obligations. Each maker, guarantor or endorser of any of the Obligations hereby waives notice of any of the foregoing actions and waives
presentment, protest, notice of dishonor, and any notice of any other formality. 
  

 Page 1 

	SECTION 	IV. BORROWER’S AFFIRMATIVE COVENANTS. 

  
 Borrower Covenants and Agrees That Borrower Shall: 
  
 (1) Pay promptly when due (unless they are being contested in good faith) all taxes, assessments, costs and expenses necessary to preserve, protect,
maintain and collect the Collateral; keep the Collateral free from other liens, security interests or other encumbrances; defend the Collateral if necessary against all claims and demands of all persons at any time claiming an interest therein
adverse to Lender, and in the event of failure to do so, Borrower agrees that Lender may make expenditures for any or all such purposes, and the amount so expended together with interest thereon at the highest lawful rate that may be charged to
Borrower by Lender shall constitute one of Borrower’s Obligations to Lender secured by the security interest granted in Section I above. Borrower hereby appoints Lender Borrower’s attorney-in-fact to enable Lender to act for Borrower in
fulfilling all Borrower’s responsibilities and exercising all of Borrower’s rights under this Agreement for the purpose of preserving and protecting the Collateral and Lender’s security interest therein; 
  
 (2) Furnish reports, data and financial statements, including audits by
independent public accountants, in respect of its business and financial condition, as Lender may reasonably require; 
  
 (3) If Lender deems it necessary, join with Lender in executing a financing statement, notice, affidavit, stock assignment, bond power or any similar
instruments that Lender deems necessary or advisable to establish or maintain its security interest in a form satisfactory to Lender together with such other instruments as Lender may from time to time request, including, without limitation, any and
all instruments or papers that may be necessary or desirable in order to comply with federal or state securities laws, and pay all costs of filing same in any public office or offices deemed advisable by Lender. 
  

	SECTION 	V. BORROWER’S NEGATIVE COVENANTS. 

  
 Borrower Covenants and Agrees That Without Prior Written Authorization from Lender, Borrower Shall Not: 
  
 (1) Change Borrower’s principal place of business to an address
different from that shown at the beginning of this Agreement without prior written notice to Lender of such change; 
  
 (2) Sell, exchange, encumber, pledge or otherwise dispose of any part or all of the Collateral or any of Borrower’s rights therein or under this
Agreement; or 
  
 (3) Assert any claims or defenses Borrower may
have against Lender against Lender’s assignee; it is understood that Lender may assign any part or all of Borrower’s Obligations and this Security Agreement to an assignee who will be entitled to all of the rights, privileges and remedies
granted in this Agreement to Lender. 
  

	SECTION 	VI. EVENTS OF DEFAULT. 

  
 Each of the following events shall constitute a Default: 
  
 (1) Default in the timely payment of any installment of principal and interest under any of the Obligations or in the performance of any covenant or
provision of any writings evidencing such Obligations (the “Loan Documents”). 
  
 (2) Borrower, or any Guarantor, shall: (a) execute an assignment for the benefit of creditors or take any action in furtherance thereof; or (b) admit in writing his inability to pay his debts generally as they become
due; or (c) as a debtor, file a petition, case, proceeding, or other action pursuant to, or voluntarily seek the benefit or benefits of any debtor relief law or take any action in furtherance thereof; or (d) seek, acquiesce in, or suffer the
appointment of a receiver, trustee, or custodian of Borrower, any Guarantor, the Collateral, in whole or in part, or any significant portion of other property belonging to Borrower or any Guarantor that affects performance under the Obligations; or
(e) voluntarily become a party to any proceeding seeking to effect a suspension or having the effect of suspending any of the rights of Lender or the Trustee granted or referred to in the Loan Documents or take any action in furtherance thereof.

  
 (3) The filing of a petition, case, proceeding, or other
action against Borrower, or any Guarantor, as a debtor under any debtor relief law; or seeking appointment of a receiver, trustee, or custodian of Borrower, or any Guarantor, or of any property described in the Loan Documents or any part thereof, or
of any significant portion of other property belonging to Borrower or any Guarantor, that affects its ability to perform under the Obligations, or seeking to effect a suspension or having the effect of suspending any of the rights of Lender or the
Trustee granted or referred to in the Loan Documents, and: (a) Borrower or any Guarantor admits, acquiesces in, or fails to contest the material allegations thereof; or (b) the petition, case, proceeding, or other action results in entry of an order
for relief or order granting the relief sought against Borrower or any Guarantor, or (c) the petition, case, proceeding, or other action is not permanently dismissed on or before the earliest of trial thereon or sixty (60) days next following the
date of its filing. 
  
 (4) The discovery by Lender that any
warranty, covenant, or representation made to Lender by or on behalf of Borrower or any Guarantor is false, misleading, erroneous, or breached in any material respect. 
  
 A Default shall not be an Event of Default if the Default is cured within ten (10) days following the delivery of or the
mailing of written notice from Lender to Borrower’s most current address as reflected in Lender’s business records specifying the existence of any such Default. If such Default is not cured within the ten (10) day period, the Default shall
be an Event of Default without need of any further notice or action by Lender. 
  

	SECTION 	VII. LENDER’S RIGHTS IN EVENT OF DEFAULT. 

  
 (1) Upon the occurrence of any Event of Default, and at any time thereafter, Lender may, without notice to Borrower, exercise its right to declare all
Obligations secured by the security interest created herein to be immediately due and payable in which case Lender will have all rights and remedies granted by law and particularly by the Texas Business and Commerce Code. 
  
 (2) As regards that portion of the Collateral consisting of cash or cash
equivalent items (i.e., checks or other items convertible at face), Lender may immediately apply them against any Obligations selected by Lender, and for this purpose, Borrower agrees that such items will be considered identical in character to cash
proceeds. 
  
 (3) As regards that portion of the Collateral other
than cash or cash equivalent items, unless such portion is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market, Lender will send Borrower reasonable notice of the time and place of any public
sale or of the time after which any private sale or other disposition of such portion or any part thereof is to be made. This requirement of sending reasonable notice will be met if such notice is mailed, postage prepaid, to Borrower at the address
designated at the beginning of this Agreement at least five days before the time of the sale or disposition. 
  
 (4) Lender will have the right immediately and without further action by it to set-off against the Obligations all money owed by Lender in any capacity to
Borrower, whether or not due, and Lender will be deemed to have exercised such right of set-off and to have made a charge against any such money at the time of any acceleration upon default even though such change is made or entered on Lender’s
books subsequent thereto. 
  
 (5) In addition to the expenses of
retaking, holding, preparing for sale, selling and the like, Lender will be entitled to recover reasonable attorneys’ fees and legal expenses as provided for in this Agreement and in the writings evidencing said Obligations before applying the
balance of the cash proceeds and proceeds from a sale or other disposition toward satisfaction of the Obligations themselves. Borrower will remain liable for of any deficiency remaining after the sale or other disposition. 
  
 (6) No act, delay, omission or course of dealing between Borrower and Lender
including Lender’s remedying of any Event of Default hereunder will constitute a waiver of any of Lender’s rights, or remedies under this Agreement. A waiver by Lender of any rights or remedies under the terms of this 

  

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Agreement or with respect to any of Borrower’s Obligations to Lender will not be a bar to the exercise of any right or remedy on any subsequent
occasion. 
  
 (7) All rights and remedies of Lender hereunder are
cumulative and may be exercised singly or concurrently, and the exercise of any one or more of them will not be a waiver of any other. No waiver, change, modification, or discharge of any of Lender’s rights or Borrower’s duties as so
specified or allowed will be effective unless contained in a written instrument signed by the Lender. 
  

	SECTION 	VIII. MISCELLANEOUS. 

  
 (1) This agreement and the security interest in the Collateral herein created will terminate when all Obligations secured hereby have been paid in full.

  
 (2) Borrower releases Lender from all claims for loss or
damage caused by any failure to collect any of the Collateral or by any act or omission on the part of Lender, its officers, agents and employees except willful misconduct. 
  
 (3) The provisions of this Agreement are in addition to those contained in any writings evidencing the Obligations secured
hereby, all of which will be construed as one instrument. In addition to the amounts provided for in said writings agreed to be paid by Borrower as reimbursement for Lender’s attorneys’ fees and legal expenses in the event of default,
Borrower also agrees to pay Lender’s reasonable attorneys’ fees in enforcing and carrying out the covenants, terms and conditions contained in this Security Agreement including Lender’s right to undertake the collection of the
Collateral as above provided. 
  
 (4) Any notice under this
Agreement shall be in writing and shall be effective when actually delivered or, if mailed, shall be deemed effective when deposited in the United States mail first class, certified mail, postage prepaid, directed to the addresses shown near the
beginning of this Agreement. Any party may change its address for notices under this Agreement by giving formal written notice to the other parties, specifying that the purpose of the notice is to change the party’s address. For notice
purposes, Borrower agrees to keep Lender informed at all times of Borrower’s current address. 
  
 (5) The term “Borrower” as used in this Agreement will be construed as singular or plural to correspond with the number of persons executing
this Agreement as Borrower. If more than one person executes this Agreement as Borrower, his, her, their or its duties and liabilities under this Agreement will be joint and several. The terms “Lender” and “Borrower” as used in
this Agreement include the heirs, executors or administrators, successors, representatives, receivers, trustees and assigns of those parties. 
  
 (6) Where there are contained in this Agreement words or phrases that are defined in the Texas Business and Commerce Code, the Code definitions will
control the meaning of the words or phrases. A determination that any provision contained herein is unenforceable will have no effect on the validity of the remaining provisions. 
  
 (7) The law governing this secured transaction will be that of the State of Texas in force on the date of execution of this
Agreement. The Obligations contained in this Agreement (which require only the Borrower’s signature to become enforceable) are performable in the county wherein Lender is located. 
  
 EXECUTED this 11th day of April, 2003. 
  

			
	 BORROWER:
  
 ENERGYTEC, INC., a Nevada Corporation

		
	 By:
	 	 
	 	 	FRANK W. COLE, its President

  

					
	 	 	 	 	 Prepared in the Law Office of:

			
	 	 	 	 	 Munson, Munson, Pierce & Cardwell, P.C.
301 W. Woodard - P. O. Box 1099
 Denison, Texas 75020
 (903) 463-3750

  

 Page 3Assignment and Bill of Sale

 Exhibit 10.60 
  
 BOWIE COUNTY, TEXAS 
 ASSIGNMENT AND BILL OF SALE AND DEED 
  

					
	 STATE OF TEXAS
	  	§	  	 
	 	  	§	  	 
	 COUNTY OF BOWIE
	  	§	  	 
	 	  	 	  	 
	 	  	 	  	 

  
 THAT, ROCKWALL
MARKETING CORPORATION, a Texas Corporation, and PRODUCERS PIPELINE CORPORATION, a Texas Corporation, both of whose addresses are 4550 Post Oak Place, Suite 175, Houston, TX 77027, hereinafter sometimes
collectively referred to as “Assignors” for and in consideration of the sum of Ten Dollars ($10.00) cash in hand and other good and valuable considerations, paid by ENERGYTEC, INC., 14785 Preston Road, Suite 550 Dallas, Texas 75254,
hereinafter sometimes referred to as “Assignee”, the receipt and sufficiency of which are hereby acknowledged, and the further consideration of the following: 
  
 Assignee’s assumption and agreement to pay according to its terms that certain indebtedness from Energytec as Borrower
to American Bank of Texas as Lender as described in that certain Modification Agreement dated April 11, 2003 which indebtedness has a current outstanding principal balance of $1,906,846.75 (the “Indebtedness”). 
  
 Assignee agrees to pay the unpaid principal and the earned interest on the
Indebtedness interest from January 1, 2003. The Indebtedness is secured by the Deeds of Trust and related lien documents described in Exhibit “B” attached hereto (“Deeds of Trust”). As further consideration, Assignee promises to
keep and perform all the covenants and obligations of the Grantors named in the Deeds of Trust and to indemnify, defend and hold Grantors and any guarantors of the Indebtedness harmless from any loss, attorney’s fees, expenses or claim
attributable to breach or default of any provision of this assumption by Grantee. 
  
 and subject to the reservation of the term net profits interest described below, does hereby grant, bargain, sell, assign, deliver, transfer, set over and convey unto Assignee: 
  
 (1) all of Assignors’ right, title and interest, in and to the oil, gas and mineral leases and properties described in Exhibit
“A” attached hereto and made a part hereof for all purposes, together with, including but not limited to, the following: 
  
 All wells, personal property and equipment including surface and downhole equipment situated upon or in the land and leases where the well(s) are located
and/or used in connection therewith and all units and unitized leases, together with all rights incident thereto, and 
  
 (2) all of Assignor’s right, title and interest, in and to the natural gas processing plants, fee lands, pipeline and gathering systems, and related facilities and
appurtenances used in connection therewith described in Exhibit “A” attached hereto and made a part hereof for all purposes, together with, including but not limited to, the following: 
  
 All buildings, facilities, easements, rights-of-way, options, servitudes,
licenses, permits, contractual rights, grants and appurtenances whether recorded or unrecorded, (including all amendments, corrections and ratifications of any instrument 

  

 - 1 - 

 
pertaining thereto), all equipment and fixtures related thereto and used in connection therewith. 
  
 Assignors reserve and retain however, a net profits interest in production
through June 30, 2003 as described in the Purchase and Sale Agreement effective midnight Central Standard Time, December 31, 2002 between Rockwall Marketing Corporation and Producers Pipeline Corporation as Sellers and Energytec, Inc. as Buyer.

  
 TO HAVE AND TO HOLD the rights and interest(s) herein
conveyed, together with all and singular the rights, privileges, equipment, and appurtenances thereto or in any wise belonging unto Assignee, its successors and assigns, forever. 
  
 This Assignment and Bill of Sale and Deed is subject to the following terms and provisions: 
  
 (1) This instrument is made with warranty of title by, through and under
Assignors, but not otherwise and Assignors represent all of the said properties, rights and/or interest herein conveyed to be free and clear of all encumbrances, except taxes and except as noted in this Assignment and Bill of Sale and Deed.

  
 (2) Assignee hereby agrees to assume all unpaid tax
obligations on the properties, rights and/or interests herein conveyed. 
  
 (3) Assignors hereby agree to execute such other instruments necessary and/or which may be required by such governing authority having jurisdiction to effect this conveyance. 
  
 (4) Assignee hereby agrees to assume the operations and obligations of
Assignors, as owner and operator of the properties herein conveyed in compliance and accordance with all applicable, federal, state and local laws, order, rules, regulations and standards set forth by any governing authority having jurisdiction.

  
 (5) Assignee, hereby agrees to exonerate, indemnify, hold
harmless and defend Assignors, their successors, and assigns, against any and all claims, damages and costs arising from any acts or omissions pertaining to any activities of Assignee, its employees, representatives, agents, or contractors and any
and all expenses connected therewith including, without limitation, all attorney’s fees. Such liability, exoneration, hold harmless and indemnification shall, without limitation, cover bodily injury, death, damage to property or natural
resources and compliance with all legal obligations including, without limitation, any governmental order or directive to test, monitor, remove, contain, treat or neutralize any pollutants or hazardous substances. Said liability, exoneration, hold
harmless and indemnification shall also cover the undertaking as well as all of the costs of any response, removal or remedial action arising from any presence, storage, discharge, release, spillage, or escape of any oil or gas fractions,
hydrocarbons, chlorides, gas vapors, irritants, contaminants, pollutants, or any other hazardous, toxic or chemical substances even if not considered hydrocarbons. 
  
 (6) Assignors hereby agree to deliver and/or turnover to Assignee, all files and records affecting and/or pertinent to the

  

 - 2 - 

 
properties herein conveyed in Assignors’ possession or which Assignors may have the right to obtain. 
  
 (7) Assignee hereby agrees to accept all personal property and equipment
associated with the properties and interests herein conveyed on an as is, where is, condition, without warranty, either express or implied as to condition, fitness for use or purpose, or merchantability of same. 
  
 DISCLAIMER OF IMPLIED WARRANTIES 
  
 THERE ARE NO WARRANTIES THAT EXTEND BEYOND THE DESCRIPTION ON THE FACE OF
THIS DISCLAIMER. ASSIGNOR DISCLAIMS ANY IMPLIED WARRANTY OF MERCHANTABILITY OF THE GOODS OR OF THE FITNESS OF THE GOODS FOR ANY PURPOSE, AND ASSIGNEE AGREES THAT THE GOODS ARE SOLD “AS IS, WHERE IS AND WITH ALL FAULTS.” 
  
 This Assignment and Bill of Sale and Deed is subject to: 
  
 (1) all documents currently of record in the County and State described on
Exhibit “A” attached hereto; 
  
 (2) the Purchase and
Sale Agreement between Rockwall Marketing Corporation, Producers Pipeline Corporation and Energytec, Inc. effective midnight Central Standard Time December 31, 2002; 
  
 (3) certain agreements described as follows: 
  

	 	(a)	Letter agreement between Newco Energy, Inc. (“Newco”), Mescalero Oil & Gas, Inc. (“Mescalero”), Rockwall Marketing Corporation (“Rockwall”) and
Producers Pipeline Corporation (“Producers”) dated January 15, 1999; 

  

	 	(b)	Assignment and Bill of Sale from Mescalaro to Rockwall effective November 1, 1998 recorded in Volume 3009, Page 233, Deed Records of Bowie County, Texas, conveying certain oil and
gas leases; 

  

	 	(c)	Assignment and Bill of Sale from Mescalaro to Producers effective November 1, 1998 recorded in Volume 3009, Page 226, Deed Records of Bowie County, Texas, conveying a gas processing
plant, fee lands, easements and other rights described therein and which requires Newco’s consent to assign; 

  

	 	(d)	The Security Agreement from Producers to Newco effective November 1, 1998 recorded in Volume 3079, Page 346, Deed Records of Bowie County, Texas; 

  

	 	(e)	The Security Agreement from Rockwall to Newco effective November 1, 1998 recorded in Volume 3079, Page 340, Deed Records of Bowie County, Texas; and 

  

	 	(f)	Transportation Agreement effective November 1, 1998 between Producers and Newco mandating a transportation fee for use of certain pipelines. 

  

 - 3 - 

 This instrument shall inure to the benefit of the parties hereto, their successors and assigns.

  
 EXECUTED as of April 21st, 2003, but this Assignment and Bill of Sale and Deed shall be effective January 1, 2003 at 12:01 a.m., the “Effective Time”. 
  

			
	ASSIGNORS:
	
	ROCKWALL MARKETING CORPORATION
		
	 BY:
	 	 /s/ Roy T. Rimmer

	 	 	 Roy T. Rimmer, Jr., President

  

			
	PRODUCERS PIPELINE CORPORATION
		
	BY:	 	 /s/ Roy T. Rimmer

	 	 	 Roy T. Rimmer, Jr., President

  

			
	ASSIGNEE:
	
	ENERGYTEC, INC.
		
	BY:	 	 /s/ Frank W. Cole

	 	 	 Frank W. Cole, President

  
 STATE OF TEXAS 
 COUNTY OF TARRANT 
  
 This instrument was acknowledged before me on the 21st day of April, 2003, by Roy T. Rimmer, President of Rockwall Marketing Corporation, a Texas Corporation, for and on behalf of said corporation. 
  

	
	
	/s/ Evelyn J Kyle
	 Notary Public – State of Texas

  
 STATE OF TEXAS 
 COUNTY OF TARRANT 
  
 This instrument was acknowledged before me on the 21st day of April, 2003, by Roy T. Rimmer, President of Producers Pipeline Corporation, a Texas Corporation, for and on behalf of said corporation. 
  

	
	
	 /s/ Evelyn J Kyle

	 Notary Public – State of Texas

  

 - 4 - 

 STATE OF TEXAS 
 COUNTY OF
TARRANT 
  
 This instrument was acknowledged before me on the
21st day of April, 2003, by Frank W. Cole, President, of Energytec, Inc., a corporation, for and on behalf of said
corporation. 
  

	
	
	 /s/ Evelyn J Kyle

	 Notary Public – State of Texas

  

 - 5 - 

 EXHIBIT “A” 
  
 AN UNDIVIDED 68.75% WORKING INTEREST IN THE FOLLOWING DESCRIBED OIL AND GAS LEASE: 
  

			
	 LESSOR:
	  	JAMES J. NAPLES
		
	 LESSEE:
	  	BARROW-SHAVER RESOURCES COMPANY
		
	 DATE:
	  	January 9, 1992
		
	 RECORDED:
	  	Volume 1716, Page 36 of the Real Property Records of Bowie County, Texas.
		
	 EXTENSIONS:
	  	January 7, 1993, recorded in Volume 1885, at Page 162 and March 5, 1993, recorded in Volume 1913, at Page 169 of the Real Property Records of Bowie County, Texas.
		
	 ASSIGNMENT:
	  	March 18, 1996, from ULTRA PETROLEUM (USA), INC. as Assignor to ROCKWALL MARKETING CORPORATION as Assignee, of record in Volume 2495, Page 236 of the Real Property Records of Bowie County,
Texas, assigning 68.75% Working Interest.
		
	 LANDS:
	  	200 acres, more or less, out of the MEP & R Railway Survey, A-420; John McClure Headright Survey, A-392, and the Daniel Morris Headright Survey, A-381, Bowie County, Texas, as more fully
described in Schedule “I” attached hereto and made a part hereof for all purposes.

  
 J.
D. OWEN GAS UNIT NO. 1 AND NO. 2 
  
 Situated in the County of Bowie, State
of Texas, and being Oil and Gas Properties, Wells and Equipment described in Assignment and Bill of Sale from Rialto Energy, Inc. to Rockwall Marketing Corporation, effective June 1, 1995, recorded in Volume 2394, Page 25, Official Records, Bowie
County, Texas, said Oil and Gas Properties being more fully described in Schedule II attached hereto and made a part hereof for all purposes. 
  
 Situated in the County of Bowie, State of Texas, and being a part of the J. S. Herring Survey, Abstract No. 263, and being Oil and Gas Properties, Wells and Equipment
described in Assignment, Bill of Sale and Conveyance from Stelaron, Inc. to Rockwall Marketing 

  

 Page 1 

 
Corporation, effective September 1, 1996, recorded in Volume 2636, Page 31, Official Records, Bowie County, Texas, said Oil and Gas Properties being more
fully described in Schedule II attached hereto and made a part hereof for all purposes. 
  
 Situated in the County of Bowie, State of Texas, and being a part of the J. S. Herring Survey, Abstract No. 263, and the E. T. Jackson Survey, Abstract No. 300, and being Oil and Gas Properties, Wells and Equipment described in Assignment
and Bill of Sale from Stratco Operating Co., Inc. to Rockwall Marketing Corporation, effective January 1, 1996, recorded in Volume 2495, Page 239, Official Records, Bowie County, Texas, said Oil and Gas Properties being more fully described in
Schedule II attached hereto and made a part hereof for all purposes. 
  
 Situated
in the County of Bowie, State of Texas, and being a part of the J. S. Herring Survey, Abstract No. 263, the E. T. Jackson Survey, Abstract No. 300, and the N. Hale Survey, Abstract No. 273, and being oil, gas and mineral leases, wells and equipment
described in Assignment and Bill of Sale from Vintage Petroleum, Inc. to Rockwall Marketing Corporation, effective September 1, 1998, recorded in Volume 2969, Page 129, Official Records, Bowie County, Texas, said Oil and Gas Properties being more
fully described in Schedule II attached hereto and made a part hereof for all purposes. 
  
 Situated in the County of Bowie, State of Texas, and being 487.829 acres out of the J. S. Herring Survey, Abstract No. 263, and the B. T. Jackson Survey, Abstract No. 300, and being Oil and Gas Properties, Wells and Equipment described in
Assignment, Bill of Sale and Conveyance from DNA Petroleum, Inc. to Rockwall Marketing Corporation, effective September 1, 1997, recorded in Volume 2761, Page 66, Official Records, Cass County, Texas, said Oil and Gas Properties being more fully
described in Schedule II attached hereto and made a part hereof for all purposes. 
  
 LOYD WILSON GAS UNIT NO. 1 
  
 Situated in the County of Bowie, State of Texas, and being part of the Daniel Morris Survey, Abstract No. 382 and being Well and Equipment described in Bill of Sale from
Vintage Petroleum, Inc. to Rockwall Marketing Corporation recorded in Volume 2705, Page 301, Official Records, Bowie County, Texas. 
  
 Situated in the County of Bowie, State of Texas and being 109 acres and 137 acres, all in the Daniel Morris Survey, Abstract No. 382 and being an Oil, Gas and Mineral
Lease from Johnson Timber & Land Co. Ltd., et al to Rockwall Marketing Corporation, effective January 1, 1997, recorded in Volume 2636, Page 18, Official Records, Bowie County, Texas. 
  
 FEAZELL NO. 1-A 
  
 Situated in the County of Bowie, State of Texas, and being 160 acres, more or less, T & P.R.R. Survey, Abstract No. 587, and being Oil
and Gas Properties, Wells and Equipment described in Assignment and Bill of Sale from Mescalaro Oil & Gas, Inc. to Rockwall Marketing Corporation effective November 1, 1998, and recorded in Volume 3009, Page 233, Official Records, Bowie County,
Texas, said Oil and Gas Properties being more fully described as Oil 

  

 Page 2 

 
and Gas Lease from William S. Feazell, et ux to Bishop Petroleum, Inc. dated January 1, 1983, recorded in Volume 18, Page 695, Real Property Records, Bowie
County, Texas. 
  
 B. E. LEWIS GAS UNIT NO. 1

  
 Situated in the County of Bowie, State of Texas, and being 621.715 acres,
more or less, out of the John J. Carson Survey, Abstract No. 112, the Jacob Barkman Survey, Abstract No. 51 and the R. F. Peters Survey, Abstract No. 480 and being Oil and Gas Properties, Wells and Equipment described in Assignment and Bill of Sale
from Mescalaro Oil & Gas, Inc. to Rockwall Marketing Corporation, effective November 1, 1998, recorded in Volume 3009, Page 233, Official Records, Bowie County, Texas, said Oil and Gas Properties being more fully described in Schedule III
attached hereto and made a part hereof for all purposes. 
  
 COUCH UNIT PROSPECT 
  
 Situated in the
County of Bowie, State of Texas, and being 1090.602 acres, more or less, and being Oil and Gas Properties described in Assignment from Field Information Services, Inc. to Rockwall Marketing Corporation, effective July 1, 1996, recorded in Volume
2636, Page 26, Official Records, Bowie County, Texas, said Oil and Gas Properties being more fully described in Schedule IV attached hereto and made a part hereof for all purposes. 
  
 RUTH MARABLE NO. 1 160.0 ACRE UNIT 
  
 Situated in the County of Bowie, State of Texas, being 160.0 acres of land, more or less, out of the Daniel Morris Headright Survey,
Abstract No. 381, as more fully described in Assignment, Bill of Sale and Conveyance: (i) from Roy T. Rimmer, Jr., to Rockwall Marketing Corporation, effective July 1, 1994, and recorded under Clerk’s File No. 11082 on September 2, 1994 in the
Real Property Records of Bowie County, Texas; (ii) from Carden Oil & Gas, Inc. to Rockwall Marketing Corporation effective September 1, 1996 and recorded in Volume 2627, Page 279 of the Real Property Records of Bowie County, Texas; and (iii)
from Coronado Company to Rockwall Marketing Corporation effective January 1, 1997 and recorded in Volume 2698, Page 106 of the Real Property Records of Bowie County, Texas, and being more fully described in Schedule V attached hereto and made a part
hereof for all purposes. 
  
 W. E. SPENCER NO.
1 
  
 Situated in the County of Bowie, State of Texas, being 160.0 acres of
land, more or less, out of the Daniel Morris Headright Survey, Abstract No. 381, as more fully described in Assignment, Bill of Sale and Conveyance: (i) from Roy T. Rimmer, Jr., to Rockwall Marketing Corporation, effective July 1, 1994, and recorded
under Clerk’s File No. 11082 on September 2, 1994 in the Real Property Records of Bowie County, Texas; (ii) from Carden Oil & Gas, Inc. to Rockwall Marketing Corporation effective September 1, 1996 and recorded in Volume 2627, Page 279 of
the Real Property Records of Bowie County, Texas; and (iii) from Coronado Company to Rockwall Marketing Corporation effective January 1, 1997 and recorded in Volume 2698, Page 106 of the Real Property Records of Bowie County, Texas, and being more
fully described in Schedule VI attached hereto and made a part hereof for all purposes. 
  

 Page 3 

 IVA L. SMITH NO. 1 
  
 Situated in the County of Bowie, State of Texas, being 160.0 acres of land, more or less, out of the Daniel Morris Headright Survey,
Abstract No. 381, as more fully described in Assignment, Bill of Sale and Conveyance: (i) from Roy T. Rimmer, Jr., to Rockwall Marketing Corporation, effective July 1, 1994, and recorded under Clerk’s File No. 11082 on September 2, 1994 in the
Real Property Records of Bowie County, Texas; (ii) from Carden Oil & Gas, Inc. to Rockwall Marketing Corporation effective September 1, 1996 and recorded in Volume 2627, Page 279 of the Real Property Records of Bowie County, Texas; and (iii)
from Coronado Company to Rockwall Marketing Corporation effective January 1, 1997 and recorded in Volume 2698, Page 106 of the Real Property Records of Bowie County, Texas, and being more fully described in Schedule VII attached hereto and made a
part hereof for all purposes. 
  

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 SCHEDULES TO EXHIBIT A OMITTED

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