June 30, 2001
LETTER LOAN AGREEMENT
The Beard Company
5600 N. May Avenue, Suite 320
Oklahoma City, Oklahoma 73112
This Amended Letter Loan Agreement supersedes the previous Amended Letter Loan Agreement between the
parties hereto dated March 31, 2001.
This Amended Letter Loan Agreement sets forth the terms and conditions under which we have agreed to extend
a revolving loan to you in the principal amount of $2,000,000.00 (the "Loan").
1. LENDER: The William M. Beard and Lu Beard
1988 Charitable Unitrust (the "Unitrust").
2. BORROWER: The Beard Company.
3. AMOUNT: Such amounts as the Borrower may request from time to
time up to $2,000,000.00. The Loan shall be evidenced
by a promissory note in the amount of $2,000,000.00 dated
as of today (the "Note"). The Borrower shall be permitted
to obtain advances, make prepayments, and obtain
additional advances, up to the amount of the Note.
4. INTEREST RATE: A fixed rate of 10.00%.
5. REPAYMENT: Accrued interest shall be due and payable semi-
annually, beginning December 31, 2001 and semi-
annually thereafter, with the outstanding principal
balance (the "Indebtedness") plus unpaid accrued
interest due and payable on June 30, 2003.
6. COLLATERAL: A. Until the Indebtedness has been paid in full, the
Borrower agrees that it will not create, grant, assume
or suffer to exist any lien, mortgage or encumbrance
(a "Lien") on its working and overriding
royalty interests in the McElmo Dome Unit in
Montezuma and Dolores Counties of Colorado
("Interests"). The Borrower will not sell,
transfer, convey or