REGISTRATION RIGHTS AGREEMENT
 
This Registration Rights Agreement (this “Agreement”) is made and entered into
effective as of __________, 2009 between La Cortez Energy, Inc., a Nevada
corporation (the “Company”) and the persons who have executed the signature
page(s) hereto (each, a “Purchaser” and collectively, the “Purchasers”).
 
RECITALS:
 
WHEREAS, to provide capital required by the Company for working capital and
other purposes, the Company has offered in compliance with Rule 506 of
Regulation D and/or Regulation S of the Securities Act (as defined herein), to
investors in a private placement transaction (the “PPO”), units (“Units”) of its
securities, each Unit consisting of one share of Common Stock (the “Investor
Shares”) and a common stock purchase warrant (the “Investor Warrants”) to
purchase one share of Common Stock; and
 
WHEREAS, the initial closing of the PPO will have taken place on or prior to the
Effective Date (as defined below); and
 
WHEREAS, in connection with the PPO, the Company agrees to provide certain
registration rights related to the Investor Shares, including “piggyback”
registration rights with respect to the shares of Common Stock issuable upon
exercise of the Investor Warrants, on the terms set forth herein;
 
NOW, THEREFORE, in consideration of the mutual promises, representations,
warranties, covenants, and conditions set forth herein, the parties mutually
agree as follows:
 
1.           Certain Definitions.  As used in this Agreement, the following
terms shall have the following respective meanings:
 
 “Approved Market” means the Over-the-Counter Bulletin Board, the Nasdaq Stock
Market, the New York Stock Exchange or the American Stock Exchange.
 
“Blackout Period” means, with respect to a registration, a period, in each case
commencing on the day immediately after the Company notifies the Purchasers that
they are required, because of the occurrence of an event of the kind described
in Section 4(f) hereof, to suspend offers and sales of Registrable Securities
during which the Company, in the good faith judgment of its board of directors,
determines (because of the existence of, or in anticipation of, any acquisition,
financing activity, or other transaction involving the Company, or the
unavailability for reasons beyond the Company’s control of any required
financial statements, disclosure of information which is in its best interest
not to publicly disclose, or any other event or condition of similar
significance to the Company) that the registration and distribution of the
Registrable Securities to be covered by such Registration Statement, if any,
would be seriously detrimental to the Company and its stockholders and ending on
the earlier of (1) the date upon which the material non-public information
commencing the Blackout Period is disclosed to the public or ceases to be
material and (2) such time as the Company notifies the selling Holders that
sales pursuant to such Registration Statement or a new or amended Registration
Statement may resume.
 
 
 

--------------------------------------------------------------------------------

 
 
 “Business Day” means any day of the year, other than a Saturday, Sunday, or
other day on which the Commission is required or authorized to close.
 
“Commission” means the U. S. Securities and Exchange Commission or any other
federal agency at the time administering the Securities Act.
 
“Common Stock” means the common stock, par value $0.001 per share, of the
Company and any and all shares of capital stock or other equity securities of:
(i) the Company which are added to or exchanged or substituted for the Common
Stock by reason of the declaration of any stock dividend or stock split, the
issuance of any distribution or the reclassification, readjustment,
recapitalization or other such modification of the capital structure of the
Company; and (ii) any other corporation, now or hereafter organized under the
laws of any state or other governmental authority, with which the Company is
merged, which results from any consolidation or reorganization to which the
Company is a party, or to which is sold all or substantially all of the shares
or assets of the Company, if immediately after such merger, consolidation,
reorganization or sale, the Company or the stockholders of the Company own
equity securities having in the aggregate more than 50% of the total voting
power of such other corporation.
 
 “Effective Date” means the date of the final closing of the PPO.
 
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Commission promulgated thereunder.
 
“Family Member” means (a) with respect to any individual, such individual’s
spouse, any descendants (whether natural or adopted), any trust all of the
beneficial interests of which are owned by any of such individuals or by any of
such individuals together with any organization described in Section 501(c)(3)
of the Internal Revenue Code of 1986, as amended, the estate of any such
individual, and any corporation, association, partnership or limited liability
company all of the equity interests of which are owned by those above described
individuals, trusts or organizations and (b) with respect to any trust, the
owners of the beneficial interests of such trust.
 
 “Holder” means each Purchaser or any of such Purchaser’s respective successors
and Permitted Assignees who acquire rights in accordance with this Agreement
with respect to any Registrable Securities directly or indirectly from a
Purchaser or from any Permitted Assignee.
 
“Investor Shares” has the meaning given it in the recitals of this Agreement.
 
“Investor Warrants” has the meaning given it in the recitals of this Agreement.
 
“Majority Holders” means at any time Holders representing a majority of the
Registrable Securities.
 
“Permitted Assignee” means (a) with respect to a partnership, its partners or
former partners in accordance with their partnership interests, (b) with respect
to a corporation, its stockholders in accordance with their interest in the
corporation, (c) with respect to a limited liability company, its members or
former members in accordance with their interest in the limited liability
company, (d) with respect to an individual party, any Family Member of such
party, (e) an entity that is controlled by, controls, or is under common control
with a transferor, or (f) a party to this Agreement.
 
 
2

--------------------------------------------------------------------------------

 
 
“Piggyback Common Share Registration” means, in any registration of Common Stock
as set forth in Section 3(b)(i), the ability of holders of Registrable Common
Shares to include Registrable Common Shares in such registration.
 
“Piggyback Registration” means, in any registration of Common Stock referenced
in Section 3(b), the right of each Holder to include the Registrable Securities
of such Holder in such registration.
 
“Piggyback Warrant Share Registration” means, in any registration of Common
Stock as set forth in Section 3(b)(ii), the ability of holders of the
Registrable Warrant Shares to include Registrable Warrant Shares in such
registration.
 
The terms “register,” “registered,” and “registration” refer to a registration
effected by preparing and filing a registration statement in compliance with the
Securities Act, and the declaration or ordering of the effectiveness of such
registration statement.
 
“Registrable Common Shares” means the Investor Shares (and not including the
Registrable Warrant Shares) but excluding (i) any Registrable Common Shares that
have been publicly sold or may be sold immediately without volume or manner of
sale limitations and without registration under the Securities Act either
pursuant to Rule 144 of the Securities Act or otherwise; (ii) any Registrable
Common Shares sold by a person in a transaction pursuant to a registration
statement filed under the Securities Act, or (iii) any Registrable Common Shares
that are at the time subject to an effective registration statement under the
Securities Act.
 
“Registrable Securities” means the Registrable Common Shares together with the
Registrable Warrant Shares.
 
“Registrable Warrant Shares” means the shares of Common Stock issued or issuable
to each Purchaser upon exercise of the Investor Warrants but excluding (i) any
Registrable Warrant Shares that have been publicly sold or may be sold
immediately without volume or manner of sale limitations and without
registration under the Securities Act either pursuant to Rule 144 of the
Securities Act or otherwise; (ii) any Registrable Warrant Shares sold by a
person in a transaction pursuant to a registration statement filed under the
Securities Act, or (iii) any Registrable Warrant Shares that are at the time
subject to an effective registration statement under the Securities Act.
 
“Registration Default Date” means the date that is 180 days after the Effective
Date.
 
“Registration Default Period” means the period following the Registration
Default Date during which any Registration Event occurs and is continuing.
 
 
3

--------------------------------------------------------------------------------

 
 
“Registration Event” means the occurrence of any of the following events:
 
(a)           the Company fails to file with the Commission the Registration
Statement on or before the Registration Filing Date;
 
(b)           the Registration Statement is not declared effective by the
Commission on or before the Registration Default Date;
 
(c)           after the SEC Effective Date, the Registration Statement ceases
for any reason to remain continuously effective or the Holders are otherwise not
permitted to utilize the prospectus therein to resell the Registrable Securities
(including a Blackout Period), for more than fifteen (15) consecutive calendar
days, except as excused pursuant to Section 3(a); or.
 
(d)           the Common Stock generally or the Registrable Common Shares
specifically are not listed or included for quotation on an Approved Market, or
trading of the Common Stock is suspended or halted on the Approved Market, which
at the time constitutes the principal market for the Common Stock, for more than
two (2) full, consecutive Trading Days; provided, however, a Registration Event
shall not be deemed to occur if all or substantially all trading in equity
securities (including the Common Stock) is suspended or halted on the Approved
Market for any length of time.
 
“Registration Filing Date” means the date that is 90 days after the Effective
Date.
 
“Registration Statement” means the registration statement that the Company is
required to file pursuant to Section 3(a) of this Agreement to register the
Registrable Common Shares.
 
“Rule 145” means Rule 145 promulgated by the Commission under the Securities
Act, as such rule may be amended or supplemented from time to time, or any
similar successor rule that may be promulgated by the Commission.
 
“Rule 144” means Rule 144 promulgated by the Commission under the Securities
Act, as such rule may be amended or supplemented from time to time, or any
similar successor rule that may be promulgated by the Commission.
 
“Rule 415” means Rule 415 promulgated by the Commission under the Securities
Act, as such rule may be amended or supplemented from time to time, or any
similar successor rule that may be promulgated by the Commission.
 
 “Securities Act” means the Securities Act of 1933, as amended, or any similar
federal statute promulgated in replacement thereof, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect at
the time.
 
“SEC Effective Date” means the date the Registration Statement is declared
effective by the Commission.
 
“Trading Day” means any day on which such national securities exchange, the
Over-the-Counter Bulletin Board or such other securities market or quotation
system, which at the time constitutes the principal securities market for the
Common Stock, is open for general trading of securities.
 
 
4

--------------------------------------------------------------------------------

 
 
2.           Term.  This Agreement shall terminate on the earlier of: (i) two
years from the Effective Date; (ii) such date on which all shares of Registrable
Securities held or entitled to be held upon conversion by such Holder may
immediately be sold under Rule 144 without regard to volume or manner of sale
limitations; or (iii) unless terminated sooner hereunder.
 
3.           Registration.
 
(a)           Registration on Form S-1.  The Company shall file a Registration
Statement within 90 days of the Effective Date on Form S-1, or other applicable
form, relating to the resale by the Holders of all of the Registrable Common
Shares, and the Company shall use its commercially reasonable efforts to cause
such Registration Statement to be declared effective prior to the Registration
Default Date; provided, that the Company shall not be obligated to effect any
such registration, qualification or compliance pursuant to this Section, or keep
such registration effective pursuant to the terms hereunder in any particular
jurisdiction in which the Company would be required to qualify to do business as
a foreign corporation or as a dealer in securities under the securities laws of
such jurisdiction or to execute a general consent to service of process in
effecting such registration, qualification or compliance, in each case where it
has not already done so.  Notwithstanding the foregoing, in the event that the
Commission limits the amount of Registrable Common Shares that may be sold, the
Company may scale back from the Registration Statement such number of
Registrable Common Shares on a pro-rata basis.  In such event, the Company shall
give the Purchasers prompt notice of the number of Registrable Common Shares
excluded therein.
 
(b)           Piggyback Registration.
 
(i)           Piggyback Common Share Registration.  If after the SEC Effective
Date, the Company shall determine to register for sale for cash any of its
Common Stock, for its own account or for the account of others (other than the
Holders), other than (i) a registration relating solely to employee benefit
plans or securities issued or issuable to employees, consultants (to the extent
the securities owned or to be owned by such consultants could be registered on
Form S-8) or any of their Family Members (including a registration on Form S-8)
or (ii) a registration relating solely to a Securities Act Rule 145 transaction
or a registration on Form S-4 in connection with a merger, acquisition,
divestiture, reorganization or similar event, the Company shall promptly give to
the Holders written notice thereof (and in no event shall such notice be given
less than 20 calendar days prior to the filing of such registration statement),
and shall, subject to Section 3(c), include as a Piggyback Registration all of
the Registrable Common Shares specified in a written request delivered by the
Holder thereof within 10 calendar days after receipt of such written notice from
the Company to the extent such Registrable Common Shares have been subject to a
cutback comment from the SEC with respect to the registration statement
discussed in Section 3(a) above. However, the Company may, without the consent
of the Holders, withdraw such registration statement prior to its becoming
effective if the Company or such other stockholders have elected to abandon the
proposal to register the securities proposed to be registered thereby.
 
 
5

--------------------------------------------------------------------------------

 
 
(ii)           Piggyback Warrant Share Registration.  If after the SEC Effective
Date, the Company shall determine to register for sale for cash any of its
Common Stock, for its own account or for the account of others (other than the
Holders), other than (i) a registration relating solely to employee benefit
plans or securities issued or issuable to employees, consultants (to the extent
the securities owned or to be owned by such consultants could be registered on
Form S-8) or any of their Family Members (including a registration on Form S-8)
or (ii) a registration relating solely to a Securities Act Rule 145 transaction
or a registration on Form S-4 in connection with a merger, acquisition,
divestiture, reorganization or similar event, the Company shall promptly give to
the Holders written notice thereof (and in no event shall such notice be given
less than 20 calendar days prior to the filing of such registration statement),
and shall, subject to Section 3(c), include as a Piggyback Registration all of
the Registrable Warrant Shares specified in a written request delivered by the
Holder thereof within 10 calendar days after receipt of such written notice from
the Company. However, the Company may, without the consent of the Holders,
withdraw such registration statement prior to its becoming effective if the
Company or such other stockholders have elected to abandon the proposal to
register the securities proposed to be registered thereby.
 
(c)           Underwriting.  If a Piggyback Registration is for a registered
public offering that is to be made by an underwriting, the Company shall so
advise the Holders of the Registrable Common Shares and the Registrable Warrant
Shares eligible for inclusion in such Registration Statement pursuant to
Sections 3(b)(i) and (ii), respectively.  In that event, the right of any Holder
to Piggyback Registration shall be conditioned upon such Holder’s participation
in such underwriting and the inclusion of such Holder’s Registrable Common
Shares or Registrable Warrant Shares in the underwriting to the extent provided
herein. All Holders proposing to sell any of their Registrable Securities
through such underwriting shall (together with the Company and any other
stockholders of the Company selling their securities through such underwriting)
enter into an underwriting agreement in customary form with the underwriter
selected for such underwriting by the Company or the selling stockholders, as
applicable.  Notwithstanding any other provision of this Section, if the
underwriter or the Company determines that marketing factors require a
limitation on the number of shares of Common Stock or the amount of other
securities to be underwritten, the underwriter may exclude some or all
Registrable Securities from such registration and underwriting.  The Company
shall so advise all Holders (except those Holders who failed to timely elect to
include their Registrable Securities through such underwriting or have indicated
to the Company their decision not to do so), and indicate to each such Holder
the number of shares of Registrable Securities that may be included in the
registration and underwriting, if any. The number of shares of Registrable
Securities to be included in such registration and underwriting shall be
allocated among such Holders as follows:
 
(i)           If the Piggyback Registration was initiated by the Company, the
number of shares that may be included in the registration and underwriting shall
be allocated first to the Company and then, subject to obligations and
commitments existing as of the date hereof, to all selling stockholders,
including the Holders, who have requested to sell in the registration on a pro
rata basis according to the number of shares requested to be included therein;
and
 
 
6

--------------------------------------------------------------------------------

 
 
(ii)           If the Piggyback Registration was initiated by the exercise of
demand registration rights by a stockholder or stockholders of the Company
(other than the Holders), then the number of shares that may be included in the
registration and underwriting shall be allocated first to such selling
stockholders who exercised such demand and then, subject to obligations and
commitments existing as of the date hereof, to all other selling stockholders,
including the Holders, who have requested to sell in the registration on a pro
rata basis according to the number of shares requested to be included therein.
 
No Registrable Securities excluded from the underwriting by reason of the
underwriter’s marketing limitation shall be included in such registration. If
any Holder disapproves of the terms of any such underwriting, such Holder may
elect to withdraw such Holder’s Registrable Securities therefrom by delivering a
written notice to the Company and the underwriter.  The Registrable Securities
so withdrawn from such underwriting shall also be withdrawn from such
registration; provided, however, that, if by the withdrawal of such Registrable
Securities, a greater number of Registrable Securities held by other Holders may
be included in such registration (up to the maximum of any limitation imposed by
the underwriters), then the Company shall offer to all Holders who have included
Registrable Securities in the registration the right to include additional
Registrable Securities pursuant to the terms and limitations set forth herein in
the same proportion used above in determining the underwriter limitation.
 
(d)           Other Registrations.  Before such date that is six months
following the SEC Effective Date, the Company will not, without the prior
written consent of the Majority Holders, file any other registration statement
with the Commission or request the acceleration of any other registration
statement filed with the Commission, and during any time subsequent to the SEC
Effective Date when the Registration Statement for any reason is not available
for use by any Holder for the resale of any Registrable Common Shares, the
Company shall not, without the prior written consent of the Majority Holders,
file any other registration statement or any amendment thereto with the
Commission under the Securities Act or request the acceleration of the
effectiveness of any other registration statement previously filed with the
Commission, other than (i) any registration statement on Form S-8 or Form S-4
and (ii) any registration statement or amendment which the Company is required
to file or as to which the Company is required to request acceleration pursuant
to any obligation in effect on the date of execution and delivery of this
Agreement.
 
 
7

--------------------------------------------------------------------------------

 
 
(e)           Occurrence of Registration Event.  If a Registration Event occurs,
then the Company will make payments to each Holder of Investor Shares (a
“Qualified Purchaser”), as liquidated damages for the amount of damages to the
Qualified Purchaser by reason thereof, at a rate equal to 1% of the purchase
price per share paid by such Holder in the PPO for the Registrable Common Shares
then held by each Qualified Purchaser for each full period of 30 days of the
Registration Default Period (which shall be pro-rated for any period less than
30 days); provided, however, if a Registration Event occurs (or is continuing)
on a date after which any of the Investor Shares cease to be Registrable Common
Shares (pursuant to the availability of Rule 144, an alternate registration
statement, or other exclusions set forth in the definition of Registrable Common
Shares), liquidated damages shall be paid only with respect to that portion of
the Qualified Purchaser’s Registrable Common Shares that are then Registrable
Common Shares.  Notwithstanding the foregoing, the maximum amount of liquidated
damages that may be paid to any Qualified Purchaser pursuant to this Section
3(e) shall be an amount equal to 10% of the purchase price per share paid by
such Holder in the PPO for the Registrable Common Shares held by such Qualified
Purchaser at the time of the first occurrence of a Registration Event.  Each
such payment shall be due and payable within five (5) days after the end of each
full 30-day period of the Registration Default Period until the termination of
the Registration Default Period and within five (5) days after such
termination.  Such payments shall constitute the Qualified Purchaser’s exclusive
remedy for such events.  If the Company fails to pay any partial liquidated
damages pursuant to this Section in full within seven days after the date
payable, the Company will pay interest thereon at a rate of 8% per annum (or
such lesser maximum amount that is permitted to be paid by applicable law) to
the Holder, accruing daily from the date such partial liquidated damages are due
until such amounts, plus all such interest thereon, are paid in full.  The
Registration Default Period shall terminate upon (i) the filing of the
Registration Statement in the case of clause (a) of the definition of
Registration Event, (ii) the SEC Effective Date in the case of clause (b) of the
definition of Registration Event, (iii) the ability of the Qualified Purchaser
to effect sales pursuant to the Registration Statement in the case of clause (c)
of the definition of Registration Event, provided, however, that in the case of
clause (c) a Registration Event will not be deemed to have occurred until the
date on which the fifteen (15) day period is exceeded, (iv) the listing or
inclusion and/or trading of the Common Stock on an Approved Market, as the case
may be, in the case of clause (d) of the definition of Registration Event, and
(v) in the case of the events described in clauses (b) and (c) of the definition
of Registration Event, the earlier termination of the Registration Default
Period.  The amounts payable as liquidated damages pursuant to this Section 3(e)
shall be payable in lawful money of the United States.  Amounts payable as
liquidated damages to each Qualified Purchaser hereunder with respect to each
share of Registrable Common Shares shall cease when the Qualified Purchaser no
longer holds such Registrable Common Shares or all such Investor Shares can be
immediately sold by the Qualified Purchaser in reliance on Rule 144 or are
otherwise no longer Registrable Common Shares as defined in this
Agreement.  Notwithstanding the foregoing, the Company will not be liable for
the payment of liquidated damages described in this Section 3(e) for any delay
in registration of the Registrable Common Shares that may be included and sold
by the Qualified Purchasers in the Registration Statement pursuant to Rule 415
solely as a result of a comment received by the SEC requiring a limit on the
number of Registrable Common Shares included in such Registration Statement in
order for such Registration Statement to be able to avail itself of Rule
415.  In the event of any such delay, the Company will use its commercially
reasonable efforts at the first opportunity that is permitted by the Commission
to register for resale the Registrable Common Shares that have been cut back
from being registered pursuant to Rule 415 only with respect to that portion of
the Qualified Purchasers’ Registrable Common Shares that are then Registrable
Common Shares.  Notwithstanding anything to the contrary contained herein, in no
event shall the Company be liable for payment of liquidating damages in
connection with the Registrable Warrant Shares.
 
(f)           Notwithstanding the provisions of Section 3(e) above, (a) if the
Commission does not declare the Registration Statement effective on or before
the Registration Default Date, or (b) if the Commission allows the Registration
Statement to be declared effective at any time before or after the Registration
Default Date, subject to the withdrawal of certain Registrable Common Shares
from the Registration Statement, and the reason for (a) or (b) is the
Commission’s determination that (x) the offering of any of the Registrable
Common Shares constitutes a primary offering of securities by the Company, (y)
Rule 415 may not be relied upon for the registration of the resale of any or all
of the Registrable Common Shares, and/or (z) a Holder of any Registrable Common
Shares must be named as an underwriter, the Holders understand and agree that in
the case of (b) the Company may reduce, on a pro rata basis, the total number of
Registrable Common Shares to be registered on behalf of each such Holder, and in
the case of (a) or (b) the Holder shall not be entitled to partial liquidated
damages with respect to the Registrable Common Shares not registered for the
reason set forth in (a) or so reduced on a pro rata basis as set forth in (b).
 
 
8

--------------------------------------------------------------------------------

 
 
4.           Registration Procedures for Registrable Common Shares.  The Company
will keep each Holder reasonably advised as to the filing and effectiveness of
the Registration Statement.  At its expense with respect to the Registration
Statement, the Company will:
 
(a)           prepare and file with the Commission with respect to the
Registrable Common Shares, a Registration Statement on Form S-1, or any other
form for which the Company then qualifies or which counsel for the Company shall
deem appropriate and which form shall be available for the sale of the
Registrable Common Shares in accordance with the intended methods of
distribution thereof, and use its commercially reasonable efforts to cause such
Registration Statement to become effective and shall remain effective for a
period of two years or for such shorter period ending on the earlier to occur of
(i) the sale of all Registrable Common Shares and (ii) the availability under
Rule 144 for each Holder to sell all of their Registrable Common Shares
(the “Effectiveness Period”).  Each Holder agrees to furnish to the Company a
completed questionnaire in the form attached to this Agreement as Annex A (a
“Selling Shareholder Questionnaire”) not later than three (3) Business Days
following the date on which such Holder receives draft materials of such
Registration Statement;
 
(b)           if the Registration Statement is subject to review by the
Commission, promptly respond to all comments and diligently pursue resolution of
any comments to the satisfaction of the Commission;
 
(c)           prepare and file with the Commission such amendments and
supplements to such Registration Statement as may be necessary to keep such
Registration Statement effective during the Effectiveness Period;
 
(d)           furnish, without charge, to each Holder of Registrable Common
Shares covered by such Registration Statement (i) a reasonable number of copies
of such Registration Statement (including any exhibits thereto other than
exhibits incorporated by reference), each amendment and supplement thereto as
such Holder may reasonably request, (ii) such number of copies of the prospectus
included in such Registration Statement (including each preliminary prospectus
and any other prospectus filed under Rule 424 of the Securities Act) as such
Holders may reasonably request, in conformity with the requirements of the
Securities Act, and (iii) such other documents as such Holder may require to
consummate the disposition of the Registrable Common Shares owned by such
Holder, but only during the Effectiveness Period;
 
(e)           use its commercially reasonable efforts to register or qualify
such registration under such other applicable securities laws of such
jurisdictions as any Holder of Registrable Common Shares covered by such
Registration Statement reasonably requests and as may be necessary for the
marketability of the Registrable Common Shares (such request to be made by the
time the applicable Registration Statement is deemed effective by the
Commission) and do any and all other acts and things necessary to enable such
Holder to consummate the disposition in such jurisdictions of the Registrable
Common Shares owned by such Holder; provided, that the Company shall not be
required to (i) qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this paragraph, (ii) subject
itself to taxation in any such jurisdiction, or (iii) consent to general service
of process in any such jurisdiction.
 
 
9

--------------------------------------------------------------------------------

 
 
(f)           as promptly as practicable after becoming aware of such event,
notify each Holder of Registrable Common Shares, the disposition of which
requires delivery of a prospectus relating thereto under the Securities Act, of
the happening of any event, which comes to the Company’s attention, that will
after the occurrence of such event cause the prospectus included in such
Registration Statement, if not amended or supplemented, to contain an untrue
statement of a material fact or an omission to state a material fact required to
be stated therein or necessary to make the statements therein not misleading and
the Company shall promptly thereafter prepare and furnish to such Holder a
supplement or amendment to such prospectus (or prepare and file appropriate
reports under the Exchange Act) so that, as thereafter delivered to the
purchasers of such Registrable Common Shares, such prospectus shall not contain
an untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading, unless suspension of the use of such prospectus otherwise is
authorized herein or in the event of a Blackout Period, in which case no
supplement or amendment need be furnished (or Exchange Act filing made) until
the termination of such suspension or Blackout Period;
 
(g)           comply, and continue to comply during the Effectiveness Period, in
all material respects with the Securities Act and the Exchange Act and with all
applicable rules and regulations of the Commission with respect to the
disposition of all securities covered by such Registration Statement;
 
(h)           as promptly as practicable after becoming aware of such event,
notify each Holder of Registrable Common Shares being offered or sold pursuant
to the Registration Statement of the issuance by the Commission of any stop
order or other suspension of effectiveness of the Registration Statement;
 
(i)           use its commercially reasonable efforts to cause all the
Registrable Common Shares covered by the Registration Statement to be quoted on
the OTC Bulletin Board or such other principal securities market on which
securities of the same class or series issued by the Company are then listed or
traded;
 
(j)           provide a transfer agent and registrar, which may be a single
entity, for the shares of Common Stock at all times;
 
(k)           cooperate with the Holders of Registrable Common Shares being
offered pursuant to the Registration Statement to issue and deliver, or cause
its transfer agent to issue and deliver, certificates representing Registrable
Common Shares to be offered pursuant to the Registration Statement within a
reasonable time after the delivery of certificates representing the Registrable
Common Shares to the transfer agent or the Company, as applicable, and enable
such certificates to be in such denominations or amounts as the Holders may
reasonably request and registered in such names as the Holders may request;
 
 
10

--------------------------------------------------------------------------------

 
 
(l)           during the Effectiveness Period, refrain from bidding for or
purchasing any Common Stock or any right to purchase Common Stock or attempting
to induce any person to purchase any such security or right if such bid,
purchase or attempt would in any way limit the right of the Holders to sell
Registrable Common Shares by reason of the limitations set forth in Regulation M
of the Exchange Act; and
 
(m)           take all other reasonable actions necessary to expedite and
facilitate the disposition by the Holders of the Registrable Common Shares
pursuant to the Registration Statement during the term of this Agreement.
 
5.           Suspension of Offers and Sales.  Each Holder agrees that, upon
receipt of any notice from the Company of the happening of any event of the kind
described in Section 4(f) hereof or of the commencement of a Blackout Period,
such Holder shall discontinue the disposition of Registrable Common Shares
included in the Registration Statement until such Holder’s receipt of the copies
of the supplemented or amended prospectus contemplated by Section 4(f) hereof or
notice of the end of the Blackout Period, and, if so directed by the Company,
such Holder shall deliver to the Company (at the Company’s expense) all copies
(including, without limitation, any and all drafts), other than permanent file
copies, then in such Holder’s possession, of the prospectus covering such
Registrable Common Shares current at the time of receipt of such notice.
 
6.           Registration Expenses.  The Company shall pay all expenses in
connection with any registration obligation provided herein, including, without
limitation, all registration, filing, stock exchange fees, printing expenses,
all fees and expenses of complying with applicable securities laws, and the fees
and disbursements of counsel for the Company and of its independent accountants;
provided, that, in any underwritten registration, each party shall pay for its
own underwriting discounts and commissions and transfer taxes. Except as
provided in this Section and Section 9, the Company shall not be responsible for
the expenses of any attorney or other advisor employed by a Holder.
 
7.           Assignment of Rights.  No Holder may assign its rights under this
Agreement to any party without the prior written consent of the Company;
provided, however, that any Holder may assign its rights under this Agreement
without such consent to a Permitted Assignee as long as (a) such transfer or
assignment is effected in accordance with applicable securities laws; (b) such
transferee or assignee agrees in writing to become subject to the terms of this
Agreement; and (c) such Holder notifies the Company in writing of such transfer
or assignment, stating the name and address of the transferee or assignee and
identifying the Registrable Securities with respect to which such rights are
being transferred or assigned.
 
8.           Information by Holder.  Holders included in any registration shall
furnish to the Company such information as the Company may reasonably request in
writing regarding such Holders and the distribution proposed by such Holders
including an updated Selling Shareholder Questionnaire if requested by the
Company.
 
 
11

--------------------------------------------------------------------------------

 
 
9.           Indemnification.
 
(a)           In the event of the offer and sale of Registrable Securities under
the Securities Act, the Company shall, and hereby does, indemnify and hold
harmless, to the fullest extent permitted by law, each Holder, its directors,
officers, partners, each other person who participates as an underwriter in the
offering or sale of such securities, and each other person, if any, who controls
or is under common control with such Holder or any such underwriter within the
meaning of Section 15 of the Securities Act, against any losses, claims, damages
or liabilities, joint or several, and expenses to which the Holder or any such
director, officer, partner or underwriter or controlling person may become
subject under the Securities Act or otherwise, insofar as such losses, claims,
damages, liabilities or expenses (or actions or proceedings, whether commenced
or threatened, in respect thereof) arise out of or are based upon any untrue
statement of any material fact contained in any registration statement prepared
and filed by the Company under which Registrable Securities were registered
under the Securities Act, any preliminary prospectus, final prospectus or
summary prospectus contained therein, or any amendment or supplement thereto, or
any omission to state therein a material fact required to be stated or necessary
to make the statements therein in light of the circumstances in which they were
made not misleading, and the Company shall reimburse the Holder, and each such
director, officer, partner, underwriter and controlling person for any legal or
any other expenses reasonably incurred by them in connection with investigating,
defending or settling any such loss, claim, damage, liability, action or
proceeding; provided, that such indemnity agreement found in this Section 9(a)
shall in no event exceed the net proceeds from the PPO, received by the Company;
and provided further, that the Company shall not be liable in any such case (i)
to the extent that any such loss, claim, damage, liability (or action or
proceeding in respect thereof) or expense arises out of or is based upon an
untrue statement in or omission from such registration statement, any such
preliminary prospectus, final prospectus, summary prospectus, amendment or
supplement in reliance upon and in conformity with written information furnished
to the Company for use in the preparation thereof or (ii) if the person
asserting any such loss, claim, damage, liability (or action or proceeding in
respect thereof) who purchased the Registrable Securities that are the subject
thereof did not receive a copy of an amended preliminary prospectus or the final
prospectus (or the final prospectus as amended or supplemented) at or prior to
the written confirmation of the sale of such Registrable Securities to such
person because of the failure of such Holder or underwriter to so provide such
amended preliminary or final prospectus and the untrue statement or omission of
a material fact made in such preliminary prospectus was corrected in the amended
preliminary or final prospectus (or the final prospectus as amended or
supplemented). Such indemnity shall remain in full force and effect regardless
of any investigation made by or on behalf of the Holders, or any such director,
officer, partner, underwriter or controlling person and shall survive the
transfer of such shares by the Holder.
 
(b)           As a condition to including Registrable Securities in any
registration statement filed pursuant to this Agreement, each Holder agrees to
be bound by the terms of this Section 9 and to indemnify and hold harmless, to
the fullest extent permitted by law, the Company, each of its directors,
officers, partners, legal counsel and accountants and each underwriter, if any,
and each other person, if any, who controls the Company within the meaning of
Section 15 of the Securities Act, against any losses, claims, damages or
liabilities, joint or several, to which the Company or any such director or
officer or controlling person may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions or
proceedings, whether commenced or threatened, in respect thereof) that arises
out of or is based upon an untrue statement in or omission from such
registration statement, any such preliminary prospectus, final prospectus,
summary prospectus, amendment or supplement in reliance upon and in conformity
with written information furnished by the Holder for use in the preparation
thereof, and such Holder shall reimburse the Company, and such Holders,
directors, officers, partners, legal counsel and accountants, persons,
underwriters, or control persons, each such director, officer, and controlling
person for any legal or other expenses reasonably incurred by them in connection
with investigating, defending, or settling any such loss, claim, damage,
liability, action, or proceeding; provided, however, that such indemnity
agreement found in this Section 9(b) shall in no event exceed the net proceeds
received by such Holder as a result of the sale of Registrable Securities
pursuant to such registration statement, except in the case of fraud or willful
misconduct.  Such indemnity shall remain in full force and effect, regardless of
any investigation made by or on behalf of the Company or any such director,
officer or controlling person and shall survive the transfer by any Holder of
such shares.
 
 
12

--------------------------------------------------------------------------------

 
 
(c)           Promptly after receipt by an indemnified party of notice of the
commencement of any action or proceeding involving a claim referred to in this
Section (including any governmental action), such indemnified party shall, if a
claim in respect thereof is to be made against an indemnifying party, give
written notice to the indemnifying party of the commencement of such action;
provided, that the failure of any indemnified party to give notice as provided
herein shall not relieve the indemnifying party of its obligations under this
Section, except to the extent that the indemnifying party is actually prejudiced
by such failure to give notice.  In case any such action is brought against an
indemnified party, unless in the reasonable judgment of counsel to such
indemnified party a conflict of interest between such indemnified and
indemnifying parties may exist or the indemnified party may have defenses not
available to the indemnifying party in respect of such claim, the indemnifying
party shall be entitled to participate in and to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified party and, after notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party shall not be liable to such
indemnified party for any legal or other expenses subsequently incurred by the
latter in connection with the defense thereof, unless in such indemnified
party’s reasonable judgment a conflict of interest between such indemnified and
indemnifying parties arises in respect of such claim after the assumption of the
defenses thereof or the indemnifying party fails to defend such claim in a
diligent manner, other than reasonable costs of investigation.  Neither an
indemnified nor an indemnifying party shall be liable for any settlement of any
action or proceeding effected without its consent.  No indemnifying party shall,
without the consent of the indemnified party, consent to entry of any judgment
or enter into any settlement, which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such indemnified party of a
release from all liability in respect of such claim or
litigation.  Notwithstanding anything to the contrary set forth herein, and
without limiting any of the rights set forth above, in any event any party shall
have the right to retain, at its own expense, counsel with respect to the
defense of a claim. Each indemnified party shall furnish such information
regarding itself or the claim in question as an indemnifying party may
reasonably request in writing and as shall be reasonably required in connection
with defense of such claim and litigation resulting therefrom.
 
 
13

--------------------------------------------------------------------------------

 
 
(d)           If an indemnifying party does or is not permitted to assume the
defense of an action pursuant to Sections 9(c) or in the case of the expense
reimbursement obligation set forth in Sections 9(a) and (b), the indemnification
required by Sections 9(a) and 9(b) shall be made by periodic payments of the
amount thereof during the course of the investigation or defense, as and when
bills received or expenses, losses, damages, or liabilities are incurred.
 
(e)           If the indemnification provided for in Section 9(a) or 9(b) is
held by a court of competent jurisdiction to be unavailable to an indemnified
party with respect to any loss, liability, claim, damage or expense referred to
herein, the indemnifying party, in lieu of indemnifying such indemnified party
hereunder, shall (i) contribute to the amount paid or payable by such
indemnified party as a result of such loss, liability, claim, damage or expense
as is appropriate to reflect the proportionate relative fault of the
indemnifying party on the one hand and the indemnified party on the other
(determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or omission relates to information supplied
by the indemnifying party or the indemnified party and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission), or (ii) if the allocation provided by clause
(i) above is not permitted by applicable law or provides a lesser sum to the
indemnified party than the amount hereinafter calculated, not only the
proportionate relative fault of the indemnifying party and the indemnified
party, but also the relative benefits received by the indemnifying party on the
one hand and the indemnified party on the other, as well as any other relevant
equitable considerations. No indemnified party guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any indemnifying party who was not guilty
of such fraudulent misrepresentation.
 
(f)           Notwithstanding the foregoing, to the extent that the provisions
on indemnification and contribution contained in the underwriting agreement
entered into in connection with an underwritten public offering are in conflict
with the foregoing provisions, the provisions in the underwriting agreement
shall control.
 
(g)           Other Indemnification.  Indemnification similar to that specified
in this Section (with appropriate modifications) shall be given by the Company
and each Holder of Registrable Securities with respect to any required
registration or other qualification of securities under any federal or state law
or regulation or governmental authority other than the Securities Act.
 
10.           Independent Nature of Each Purchaser’s Obligations and
Rights.  The obligations of each Purchaser under this Agreement are several and
not joint with the obligations of any other Purchaser, and each Purchaser shall
not be responsible in any way for the performance of the obligations of any
other Purchaser under this Agreement. Nothing contained herein and no action
taken by any Purchaser pursuant hereto, shall be deemed to constitute such
Purchasers as a partnership, an association, a joint venture, or any other kind
of entity, or create a presumption that the Purchasers are in any way acting in
concert or as a group with respect to such obligations or the transactions
contemplated by this Agreement. Each Purchaser shall be entitled to
independently protect and enforce its rights, including without limitation the
rights arising out of this Agreement, and it shall not be necessary for any
other Purchaser to be joined as an additional party in any proceeding for such
purpose.
 
 
14

--------------------------------------------------------------------------------

 
 
11.           Miscellaneous.
 
(a)           Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the United States of America and the State of New
York, both substantive and remedial, without regard to New York conflicts of law
principles. Any judicial proceeding brought against either of the parties to
this Agreement or any dispute arising out of this Agreement or any matter
related hereto shall be brought in the courts of the State of New York, New York
County, or in the United States District Court for the Southern District of New
York and, by its execution and delivery of this Agreement, each party to this
Agreement accepts the jurisdiction of such courts. The foregoing consent to
jurisdiction shall not be deemed to confer rights on any person other than the
parties to this Agreement.
 
(b)           Remedies.  In the event of a breach by the Company or by a Holder
of any of their respective obligations under this Agreement, each Holder or the
Company, as the case may be, in addition to being entitled to exercise all
rights granted by law and under this Agreement, including recovery of damages,
shall be entitled to specific performance of its rights under this
Agreement.  The Company and each Holder agree that monetary damages would not
provide adequate compensation for any losses incurred by reason of a breach by
it of any of the provisions of this Agreement and hereby further agrees that, in
the event of any action for specific performance in respect of such breach, it
shall not assert or shall waive the defense that a remedy at law would be
adequate.
 
(c)           Successors and Assigns.  Except as otherwise provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon, the
successors, Permitted Assignees, executors and administrators of the parties
hereto.
 
(d)           No Inconsistent Agreements.  The Company has not entered, as of
the date hereof, and shall not enter, on or after the date of this Agreement,
into any agreement with respect to its securities that would have the effect of
impairing the rights granted to the Holders in this Agreement or otherwise
conflicts with the provisions hereof.
 
(e)           Entire Agreement.  This Agreement constitutes the full and entire
understanding and agreement between the parties with regard to the subjects
hereof.
 
(f)           Notices, etc. All notices or other communications which are
required or permitted under this Agreement shall be in writing and sufficient if
delivered by hand, by facsimile transmission, by registered or certified mail,
postage pre-paid, by electronic mail, or by courier or overnight carrier, to the
persons at the addresses set forth below (or at such other address as may be
provided hereunder), and shall be deemed to have been delivered as of the date
so delivered:
 
If to the Company to:

La Cortez Energy, Inc.
Calle 67 #7-35, Oficina 409
Bogota, Colombia
Attention:  Andres Gutierrez Rivera, Chief Executive Officer
Facsimile:
 
 
15

--------------------------------------------------------------------------------

 

with copy to:

Gottbetter & Partners, LLP
488 Madison Avenue, 12th Floor
New York, NY  10022
Attention:  Adam S. Gottbetter, Esq.
Facsimile:  (212) 400-6901

If to the Purchasers:

To each Purchaser at the address set forth on the signature page hereto;

or at such other address as any party shall have furnished to the other parties
in writing.
 
(g)           Delays or Omissions.  No delay or omission to exercise any right,
power or remedy accruing to any Holder, upon any breach or default of the
Company under this Agreement, shall impair any such right, power or remedy of
such Holder nor shall it be construed to be a waiver of any such breach or
default, or an acquiescence therein, or of any similar breach or default
thereunder occurring; nor shall any waiver of any single breach or default be
deemed a waiver of any other breach or default theretofore or thereafter
occurring. Any waiver, permit, consent or approval of any kind or character on
the part of any Holder of any breach or default under this Agreement, or any
waiver on the part of any Holder of any provisions or conditions of this
Agreement, must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement, or by law or otherwise afforded to any holder, shall be cumulative
and not alternative.
 
(h)           Counterparts.  This Agreement may be executed in any number of
counterparts, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.  In the event that any signature is delivered by facsimile
transmission, such signature shall create a valid and binding obligation of the
party executing (or on whose behalf such signature is executed) with the same
force and effect as if such facsimile signature page were an original thereof.
 
(i)           Severability. In the case any provision of this Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
 
(j)           Amendments. The provisions of this Agreement may be amended at any
time and from time to time, and particular provisions of this Agreement may be
waived, with and only with an agreement or consent in writing signed by the
Company and the Majority Holders. The Purchasers acknowledge that by the
operation of this Section, the Majority Holders may have the right and power to
diminish or eliminate all rights of the Purchasers under this Agreement.
 
 
16

--------------------------------------------------------------------------------

 
 
(k)           Limitation on Subsequent Registration Rights.  After the date of
this Agreement, the Company shall not, without the prior written consent of the
Majority Holders, enter into any agreement with any holder or prospective holder
of any securities of the Company that would grant such holder registration
rights senior or equal to those granted to the Holders hereunder.
 

 
[SIGNATURE PAGES FOLLOW]
 
 
17

--------------------------------------------------------------------------------

 
 
This Registration Rights Agreement is hereby executed as of the date first above
written.
 

  COMPANY:           LA CORTEZ ENERGY, INC.          
 
By:
      Name:   Andres Gutierrez Rivera     Title:  Chief Executive Officer  

 
 
[SIGNATURE PAGE OF PURCHASER FOLLOWS]
 
 
18

--------------------------------------------------------------------------------

 
 
This Registration Rights Agreement is hereby executed as of the date first above
written.
 

  PURCHASER (Individual)                             (Print Name)          
PURCHASER (Entity)          
 
By:
                    (Print Name)                 (Print Title)                
Address for notices:                                        
City                                      State                         Zip Code
         

 
 
19

--------------------------------------------------------------------------------

 

Annex A
 
LA CORTEZ ENERGY, INC.
 
Selling Securityholder Notice and Questionnaire
 
The undersigned beneficial owner of Registrable Common Shares of La Cortez
Energy, Inc., a Nevada corporation (the “Company”), understands that the Company
intends to file with the Securities and Exchange Commission a registration
statement (the “Registration Statement”) for the registration and resale under
Rule 415 of the Securities Act of 1933, as amended, of the Registrable Common
Shares, in accordance with the terms of the Registration Rights Agreement (the
“Registration Rights Agreement”) to which this document is annexed.  A copy of
the Registration Rights Agreement is available from the Company upon request at
the address set forth below.  All capitalized terms not otherwise defined herein
shall have the meanings ascribed thereto in the Registration Rights Agreement.
 
Certain legal consequences arise from being named as a selling securityholder in
the Registration Statement and the related prospectus.  Accordingly, holders and
beneficial owners of Registrable Common Shares are advised to consult their own
securities law counsel regarding the consequences of being named or not being
named as a selling securityholder in the Registration Statement and the related
prospectus.
 
NOTICE
 
The undersigned beneficial owner (the “Selling Securityholder”) of Registrable
Common Shares hereby elects to include the Registrable Common Shares owned by it
in the Registration Statement.
 
The undersigned hereby provides the following information to the Company and
represents and warrants that such information is accurate:
 
QUESTIONNAIRE
 
 
1.
Name:

 
 
(a)
Full Legal Name of Selling Securityholder
                 

 
 
(b)
Full Legal Name of Registered Holder (if not the same as (a) above) through
which Registrable Common Shares are held:
                 

 
 
 

--------------------------------------------------------------------------------

 
 
 
(c)
Full Legal Name of Natural Control Person (which means a natural person who
directly or indirectly alone or with others has power to vote or dispose of the
securities covered by the questionnaire):
                 

 
 
2.
Address for Notices to Selling Securityholder:

 

      Telephone:     Fax:  
                                                               
Email:
         
Contact Person:
         

 
3.
Broker-Dealer Status:

 
 
(a)
Are you a broker-dealer?

 
Yes   o                      No   o
 
 
(b)
If “yes” to Section 3(a), did you receive your Registrable Common Shares as
compensation for investment banking services to the Company?

 
Yes   o                     No   o
 
Note:
If no, the Commission’s staff has indicated that you should be identified as an
underwriter in the Registration Statement.

 
 
(c)
Are you an affiliate of a broker-dealer?

 
Yes   o                      No   o
 
 
(d)
If you are an affiliate of a broker-dealer, do you certify that you bought the
Registrable Common Shares in the ordinary course of business, and at the time of
the purchase of the Registrable Common Shares to be resold, you had no
agreements or understandings, directly or indirectly, with any person to
distribute the Registrable Common Shares?

 
Yes   o                      No   o
 
Note:
If no, the Commission’s staff has indicated that you should be identified as an
underwriter in the Registration Statement.

 
4.
Beneficial Ownership of Securities of the Company Owned by the Selling
Securityholder:

 
Except as set forth below in this Item 4, the undersigned is not the beneficial
or registered owner of any securities of the Company other than the securities
issuable pursuant to the PPO.
 
 
2

--------------------------------------------------------------------------------

 
 
 
(a)
Type and Amount of other securities (other than the Registrable Common Shares)
beneficially owned by the Selling Securityholder:
                 

 
 
5.
Relationships with the Company:

 
Except as set forth below, neither the undersigned nor any of its affiliates,
officers, directors or principal equity holders (owners of 5% or more of the
equity securities of the undersigned) has held any position or office or has had
any other material relationship with the Company (or its predecessors or
affiliates) during the past three years.
 
 
State any exceptions here:
           

 
The undersigned agrees to promptly notify the Company of any inaccuracies or
changes in the information provided herein that may occur subsequent to the date
hereof at any time while the Registration Statement remains effective.
 
By signing below, the undersigned consents to the disclosure of the information
contained herein in its answers to Items 1 through 5 and the inclusion of such
information in the Registration Statement and the related prospectus and any
amendments or supplements thereto.  The undersigned understands that such
information will be relied upon by the Company in connection with the
preparation or amendment of the Registration Statement and the related
prospectus.
 
IN WITNESS WHEREOF the undersigned, by authority duly given, has caused this
Selling Securityholder Notice and Questionnaire to be executed and delivered
either in person or by its duly authorized agent.
 
Dated:
   
Beneficial Owner:
                  By:            
Name: 
         
Title:
 

 

PLEASE FAX A COPY OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE, AND
RETURN THE ORIGINAL BY OVERNIGHT MAIL, TO:

Gottbetter & Partners, LLP
488 Madison Avenue, 12th Floor
New York, NY  10022
Attention:  Rachel L. DeGenero
Facsimile:  (212) 400-6901
 
 
3

--------------------------------------------------------------------------------