Translated from the original Mandarin
Lien holder: Song Yuan City Wu Lan Da Jie Cheng Shi Xin Yong She
Mortgager: Wang Hongjun, Sun Jishuang
In order to ensure the fulfilment of lien holder’s rights, borrower: Song Yuan Yu Qiao Qian’an Hong Xiang
Petroleum and Gas Development Co., Ltd . asks the mortgagers to provide hypothecation. Mortgagers fully
understand the financial situation of borrower, and willingly provide such hypothecation according to the
mortgage contract of 2005-M-531 (“Contract”). In order to specify the rights and obligations of both parties,
according to “China contract law” and “China hypothecation law,” this contract is agreed and signed by both
Article 1 Category of Lien and Value
The category of mortgage of this contract is the loan, which lien holder shall provide the loan according to the
contract, and total value of such loan is RMB 2,000,000.
Article 2 Bounds of Hypothecation
The bounds of hypothecation which apply to mortgagers are: principle of the loan, interest, overdue interest,
amercement, penalty of breach, compensation of breach, legal cost, attorney cost, guaranty disposal fee, transfer
fee etc. which could happen to lien holders in fulfilling his rights.
Article 3 Guaranty
Article 4 Force of Hypothecation
The force of hypothecation is extended to the affiliation of guaranty, accessory right, right of Subrogation,
appendix, mixture, process and other articles.
Article 5 Register of Guaranty
According to China laws and regulations or the agreement between both parties, any guaranty which needs
register shall be registered in local mortgage registering administration department within 15 days of singing this
contract, and the certificate of guaranty ownership, the original copy of register and other property certificate
shall be kept by lien holder.
Article 6 Occupancy of Guarantor
Article 7 Insurance of Guarantor
1. Mortgager agrees to provide such properties set forth in th