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Exhibit 10.1
 
LOAN AGREEMENT

 
THIS LOAN AGREEMENT, dated for reference March 12 , 2008 is made
 
BETWEEN:
 
DAVID LYALL, Suite 2000, Commerce Place, 400 Burrard Street, Vancouver, B.C.,
V6C 3A6

 
(the "Lender");
 
AND:
 
GULF    WESTERN    PETROLEUM    CORPORATION,    acorporation incorporated under
the laws of the State of Nevada, with its registered office at 4801 Woodway
Drive, Suite 306W, Houston, Texas 77056

 
(the "Borrower").

 
WHEREAS the Borrower wishes to borrow and the Lender is willing to lend to the
Borrower US$500,000 (the "Principal") on the terms of this Agreement.
 
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the premises and
the mutual covenants and agreements hereinafter set forth, the parties hereto
agree as follows:

 
1.
DEFINITIONS

 
Where used in this Agreement, the following words and phrases shall have the
following meaning:
 
(a)
"Agreement" means this Agreement and the schedule hereto, as at any time amended
or modified and in effect;

 
(b) 
"Bonus" has the meaning given to that term in section 5;

 
(c) 
"Event of Default" means any event specified in subsection 8.1;

 
(d) 
"Lender's Security" means the Note;

 
(e)
"Loan" means the loan by the Lender to the Borrower established pursuant to
subsection 3.1; and

 

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(f)
"Note" means the promissory note to be made by the Borrower to the Lender as
evidence of the Loan.

 
2.
INTERPRETATION

 
2.1
Governing Law

 
This Agreement is governed by the laws of the Province of British Columbia and
the parties attorn to the non-exclusive jurisdiction of the courts of British
Columbia for the resolution of all disputes under this Agreement.
 
2.2
Severability

 
If any one or more of the provisions contained in this Agreement is found to be
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein will not in any way
be affected or impaired thereby.
 

   
2.3
Parties In Interest

 
This Agreement enures to the benefit of and is binding on the parties hereto and
their respective successors and permitted assigns.
 
2.4
Headings and Marginal References

 
The division of this Agreement into sections, subsections, paragraphs and
subparagraphs and the insertion of headings are for convenience of reference
only and do not affect the construction or interpretation of this Agreement.
 
2.5
Currency

 

All statements of, or references to, dollar amounts in this Agreement means
lawful currency of United Stales of America.
 
 
3.
THE LOAN

 
3.1
Establishment of the Loan

 
The Lender agrees, on the terms and conditions set forth in this Agreement, to
lend to the Borrower $500,000.
 
3.2
Evidence of Indebtedness

 
Indebtedness of the Borrower to the Lender in respect of the Loan will be
evidenced by the execution this Agreement and the Note, which will be made by
the Borrower to the Lender at the time of execution of this Agreement.

 
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3.3
Interest

 
The Borrower will pay interest at a rate of 10% per annum to the Lender on the
amount of Principal outstanding both before and after maturity, default and
judgment. Interest on the outstanding Principal amount shall accrue daily and
compound annually. Additionally, the repayment of accrued interest will paid on
a monthly basis (on the 12th of each month), with the first payment being made 3
months after the execution of the Agreement.
 
  
3.4
Repayment of the Loan

 
The entire Principal and the final interest payment payable pursuant to this
Agreement shall be due and payable on March 12, 2009.
 
 
3.5
Prepayment of Loan

 
Provided that the Bonus as set forth in section 5 below, the Borrower may prepay
the Principal and the interest outstanding under the Loan at any time without
penalty, bonus or charges.
 
 
4.
SECURITY FOR THE LOAN

 
 
4.1
Lender's Security

 
On the execution of this Agreement the Borrower will execute and deliver to the
Lender the Note, the form of which is attached hereto as Schedule A, evidencing
the Borrower's obligations and covenants under this Loan Agreement.
 
 
4.2
Costs, Charges and Expenses

 
The Borrower will assume and pay all costs, commission, charges and expenses,
including reasonable solicitors' costs, charges and expenses on a special costs
basis, which may be incurred by the Lender in respect of the enforcement of this
Agreement or the Lender's Security or which may be incurred by the Lender in
respect of any proceedings taken or things done by the Lender in connection
therewith to collect, protect, realize or enforce the Lender's Security and the
Borrower consents to such costs, charges and expenses being charged and fixed on
a lump sum basis in accordance with the Legal Profession Act (British Columbia).
 
 
5.
BONUS

 
On the execution of this Agreement, the Borrower agrees to immediately issue to
the Lender, as a bonus (the "Bonus"), 1,000,000 Rule 144 common shares in the
share capital of the Borrower, at a deemed price of $0.25. In conjunction with
the issuance of the common shares to Lender, Lender confirms that he is as an
Accredited Investor as that term is defined in Regulation D adopted pursuant to
the Securities Act of 1933, as amended. Specifically, the Lender is a natural
person whose individual net worth, or joint net worth with that person's spouse,
at the time of his receipt of common shares exceeds SI,000,000.

 
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6.
REPRESENTATIONS AND WARRANTIES

 
 
6.1
Representations and Warranties

 
The Borrower represents and warrants to the Lender that:
 
(a)
the Borrower is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Nevada;

 
(b)
the Borrower has all requisite corporate power and authority to enter into this
Agreement and to carry out the obligations contemplated herein and therein;

 
(c)
this Agreement has been duly and validly authorized, executed and delivered by
the Borrower and are valid obligations of it; and

 
(d)
no Event of Default and no event which, with the giving of notice or lapse of
time would become an Event of Default, has occurred or is continuing.

 
 
6.2
Survival of Representations and Warranties

 
All representations and warranties made herein will survive the delivery of this
Agreement to the Lender and no investigation at any time made by or on behalf of
the Lender shall diminish in any respect whatsoever its rights to rely on those
representations and warranties. All statements contained in any certificate or
other instrument delivered by or on behalf of the Borrower under or pursuant to
this Agreement will constitute representations and warranties made by the
Borrower thereunder.
 
 
7.
COVENANTS OF THE BORROWER

 
The Borrower covenants and agrees with the Lender that, at all times during the
currency of this Agreement, it will:
 
(a)
pay the principal sum, interest and all other monies required to be paid to the
Lender pursuant to this Agreement in the manner set forth herein;

 
(b)
duly observe and perform each and every of its covenants and agreements set
forth in this Agreement; and

 
(c) 
provide the Lender with immediate notice of any Event of Default.

 
8.
EVENT OF DEFAULT

 
 
8.1
Definition of Event of Default

 
The principal balance of the Loan, costs and any other money owing to the Lender
under this Agreement will immediately become payable upon demand by the Lender
or, unless otherwise waived in writing by the Lender, in any of the following
events:

 
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(a)
if the Borrower defaults in any payment when due under this Agreement;

 
 
(b)
if the Borrower makes a general assignment for the benefit of its creditors, or
if any order is made or an effective resolution is passed for the winding-up,
merger or amalgamation of the Borrower or if the Borrower is declared bankrupt
or if a custodian or receiver be appointed for the Borrower under the applicable
bankruptcy or insolvency legislation, or if a compromise or arrangement is
proposed by the Borrower to its creditors or any class of its creditors, or if a
receiver or other officer with like powers is appointed for the Borrower; or

 
 
(c)
if the Borrower defaults in observing or performing any other covenant or
agreement of this Agreement on its part to be observed or performed and such
default has continued for a period of seven days after notice in writing has
been given by the Lender to the Borrower specifying the default,

 
 
8.
ASSIGNMENT

 
8.1
Assignment of Borrower

 
The Borrower may not assign this Agreement or its interest herein or any part
hereof except with the prior written consent of the Lender.

 
9.
GENERAL

 
9.1
Waiver or Modification

 
No failure on the part of the Lender in exercising any power or right hereunder
will operate as a waiver of the Lender's power or right nor will any single or
partial exercise of such right or power preclude any other right or power
hereunder. No amendment, modification or waiver of any condition of this
Agreement or consent to any departure by the Borrower therefrom will be
effective unless it is in writing signed by the Lender. No notice to or demand
on the Borrower will entitle the Borrower to any other further notice or demand
in similar or other circumstances unless specifically provided for in this
Agreement.
 
9.2
Time

 
Time is of the essence of this Agreement.
 
9.3
Further Assurances

 
The parties to this Agreement will do, execute and deliver or will cause to be
done, executed and delivered all such further acts, documents and things as may
be reasonably required for the purpose of giving effect to this Agreement.

 
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10.
NOTICES

 
10.1                   Any notice under this Agreement will be given in writing
and may be sent by fax, telex, telegram or may be delivered or mailed by prepaid
post addressed to the party to which notice is to be given at the address
indicated above, or at another address designated by that party in writing.

10.2                   If notice is sent by fax or is delivered, it will be
deemed to have been given at the time of transmission or delivery.

10.3                   If notice is mailed, it will be deemed to have been
received 48 hours following the date of mailing of the notice.
 
10.4                   If there is an interruption in normal mail service due to
strike, labour unrest or other cause at or before the time a notice is mailed
the notice will be sent by fax or will be delivered.

 
[THE REST OF THIS PAGE LEFT INTENTIONALLY BLANK]

 
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11.
AMENDMENTS

 
This Agreement may be amended waived discharged or terminated only by instrument
in writing signed by the party against whom enforcement of the amendment,
waiver, discharge or termination is sought.
 
IN WITNESS WHEREOF the Lender and the Borrower have executed and delivered this
Agreement.
 

SIGNED, SEALED AND DELIVERED by
)
 
DAVID LYALL in the presence of:
)
   
)
 
Lorinne Elliot
)
 
Name
)
 
2100-400 Burrard St.
)
 
Vancouver, B.C.
)
 
V6C3A6
)
/s/ David Lyall
Address
)
DAVID LYALL
 
)
 
Assistant
)
 
Occupation
)
MARCH 12, 2008

 
 
GULF WESTERN PETROLEUM CORPORATION
             
By:
/s/ Donald L. Sytsma    
Authorized Signatory
 

 
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SCHEDULE "B"
FORM OF PROMISSORY NOTE
PROMISSORY NOTE

 

US$500,000 
March 12, 2008

 
                                                                      
FOR VALUE RECEIVED, GULF WESTERN PETROLEUM CORPORATION (the "Borrower"), of 4801
Woodway Drive, Suite 306W, Houston Texas 77056, PROMISES TO PAY on demand to the
order of DAVID LYALL, of 2000-400 Burrard Street, Vancouver, B.C. V6C 3A6, the
sum of US$500,000 with interest at 10% per annum accrued daily and compounded
annually and payable annually in arrears, both before and after the time payment
is due and until actual payment.
 
The Borrower waives presentment for payment, notice of protest and notice of
non-payment.
 
The Borrower may repay, at any time, all or any part of the US$500,000 without
notice, bonus or penalty.
 
Signed as of MARCH 12, 2008.
 
GULF WESTERN PETROLEUM CORPORATION.
 
 

By: /s/ DOnald L. Sytsma  

 

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