Exhibit 10.23
EXECUTIVE EMPLOYMENT AGREEMENT
 
Executive Employment Agreement between Gran Tierra Energy Colombia Ltd., a Utah
partnership (the “Partnership”), Gran Tierra Energy Inc., a Nevada corporation
(“Gran Tierra”), Gran Tierra Energy Cayman Islands Inc., a Cayman Islands
company (“GTE Cayman”), and Julian Antonio Garcia Salcedo (the “Executive”,
collectively with the Partnership, GTE Cayman and Gran Tierra, the “Parties”).
The Partnership and GTE Cayman are subsidiaries of Gran Tierra.
 
Recitals:
 
 
A.
The Executive has specialized knowledge skills and experience which are valuable
to the ongoing success of the business.

 
 
B.
The Partnership and Gran Tierra wish to secure the services of the Executive for
the position of President of the Partnership.

 
 
C.
The Parties wish to set forth their entire understanding and agreement with
respect to the subject matter with this Executive Employment Agreement (the
“Agreement”).

 
Therefore, the Parties agree as follows:
 
ARTICLE 1
DUTIES AND RESPONSIBILITIES
 
1.1           Position
 
The Partnership appoints the Executive to the position of President of Gran
Tierra Energy Colombia and the Executive shall perform the duties and
responsibilities set out in Schedule “A” to this Agreement as well as those
duties reasonably assigned to the Executive by the Board of Directors of Gran
Tierra (the “Board”) or the Board of Directors of GTE Cayman. The Parties agree
that the relationship between the Partnership and the Executive created by this
Agreement is that of employer and employee.
 
1.2           Other Engagements
 
The Executive shall not engage in any other business, profession or occupation
which would conflict with the performance of his duties and responsibilities
under this Agreement, either directly or indirectly, including accepting
appointments to the boards of other companies without the prior written consent
of the Board.
 
1.3           Reassignment and Cooperation
 
The Executive shall not be reassigned to another position within the Partnership
itself, or to a position within another subsidiary or Gran Tierra, or other
affiliated or related corporate entity (a “Member Company” or “Member
Companies”) and the Executive’s duties, responsibilities, title, reporting lines
and location of employment will not be altered unless the Executive agrees to
such reassignment or alteration. The Executive may be appointed as the manager
of Argosy Energy LLC, the general partner of the Partnership. The Partnership
will use reasonable efforts to efficiently structure, and assist the Executive’s
compliance with, applicable payroll, labor, tax, social security legal
requirements and the Partnership may cause its Colombian branch to execute
employment contracts with the Executive, as needed for this purpose.
 
1.4           Travel
 
The Executive shall be available for such business related travel as may be
required for the purposes of carrying out the Executive’s duties and
responsibilities. The Executive shall be entitled to fly business class for
international flights and shall use economy for domestic travel. The Executive
will be entitled to choose suitable accommodations when traveling on the
Partnership’s or Gran Tierra’s business.
 
 
 

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ARTICLE 2
TERM OF EMPLOYMENT
 
The Executive’s employment with the Partnership is for no specified duration and
constitutes at-will employment. The Executive’s employment may be terminated at
any time by either the Partnership or the Executive, subject to the provisions
of Article 9.
 
ARTICLE 3
BASE SALARY
 
The Executive will be paid an annual salary in the amount of $600,000,000
Colombian pesos, subject to required withholdings (the “Base Salary”). The
Executive’s Base Salary will be payable in accordance with Partnership practices
and procedures as they may exist from time to time. Base Salary will be reviewed
and may be increased on an annual basis by the Partnership, with input from the
Executive.
 
ARTICLE 4
BONUS
 
4.1           Bonus Eligibility
 
The Executive shall be eligible to receive an annual bonus payment in addition
to Base Salary and other compensation for each year of the Executive’s
employment. The bonus target is 60% of the Executive’s base salary and the
actual amount will be determined by the Board annually.
 
4.2           Bonus Payment
 
The Bonus shall be payable within sixty (60) days of the end of the fiscal year,
and will based upon the Executive’s performance, the performance of Gran Tierra
Energy Colombia and the performance of Gran Tierra Energy Inc. during the
preceding year.
 
ARTICLE 5
BENEFITS
 
The Executive shall be entitled to participate in and to receive all rights and
benefits under any life insurance, disability, medical, dental, health and
accident plans maintained by Gran Tierra for the Partnership’s employees and for
its executives. The Partnership will continue to pay the Executive’s Base Salary
in the event the Executive becomes disabled until such time the Executive begins
to receive long-term disability insurance benefits.
 
ARTICLE 6
VACATION
 
The Executive will be entitled to four weeks of paid vacation per year. Payment
of all vacation pay will be at Base Salary. The Executive will arrange vacation
time to suit the essential business needs of the Partnership, GTE Cayman and
Gran Tierra. Unused vacation entitlement will be carried over into the following
calendar year to a maximum entitlement of six weeks in any one year. On leaving
the employment of the Partnership for whatever reason, the Partnership will
compensate the Executive for any accrued but unused vacation entitlement based
upon the Executive’s then current Base Salary.
 
 
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ARTICLE 7
STOCK OPTIONS
 
The Executive will be provided an initial stock options grant of 300,000 shares
of the common stock of Gran Tierra, in accordance with the terms and conditions
of the 2007 Gran Tierra Energy Equity Incentive Plan. The stock options will be
priced in accordance with the terms of the plan on the first date of employment
of the Executive with the Partnership. The Executive will be eligible to
participate in applicable future stock option plans and/or incentive award plans
created by Gran Tierra in accordance with their terms and conditions.
 
ARTICLE 8
PERQUISITES AND EXPENSES
 
The Partnership recognizes that the Executive will incur expenses in the
performance of the Executive’s duties. The Partnership shall reimburse the
Executive for any reasonable out of pocket expenses incurred in the course of
employment.
 
8.1           Partnership Vehicle and Driver
 
The Executive shall be entitled to a suitable Partnership vehicle and a
dedicated driver. All operating costs of the vehicle and the compensation for
the driver will be paid by the Partnership.
 
8.2           Second Car Allowance
 
The executive shall be entitled to a second car allowance of $1,000,000
Colombian pesos a month subject to all statutory deductions.
 
8.3           Recreation or Golf Club Membership
 
The Executive shall be eligible for membership at a suitable recreation of golf
club in Bogota. The Partnership will approve the club selected by the Executive
and pay for the cost of the membership and reasonable expenses of the club.
 
ARTICLE 9
TERMINATION OF EMPLOYMENT
 
9.1           Termination Without Notice
 
This Agreement and the Executive’s employment with Partnership may be
terminated, without Partnership being obligated to provide the Executive with
advance notice of termination or pay in lieu of such notice, whether under
contract, statute, common law or otherwise, in the following circumstances:
 
(a)           Voluntary Resignation
 
In the event the Executive voluntarily resigns, except where the Executive
resigns for Good Reason as provided for in this Agreement, the Executive will
give a minimum of ninety (90) days’ advance written notice to the Partnership
and Gran Tierra. The Executive will not be entitled to receive any further
compensation or benefits whatsoever other than those which have accrued up to
the Executive’s last day of active service with the Partnership. The Partnership
may, at its discretion, waive in whole or in part such notice with payment in
lieu to the Executive;
 
(b)           Cause
 
“Cause” is defined as any of the following:
 
 
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(a)           conviction of, or plea of nolo contendere to, a felony;
 
(b)           participation in a fraud against the Partnership;
 
(c)           participation in an act of dishonesty against the Partnership
intended to result in the Executive’s personal enrichment;
 
(d)           willful material breach of the Partnership’s written policies;
 
(e)           intentional significant damage to the Partnership’s property by
the Executive;
 
(f)           material breach of this Agreement; or
 
(g)           conduct by the Executive that, in the good faith and reasonable
determination of the Board, demonstrates gross unfitness to serve provided that
in such event, the Partnership shall provide notice describing the nature of the
gross unfitness and the Executive shall thereafter have ten (10) days to cure
such gross unfitness if such gross unfitness is capable of being cured.
 
The Partnership may not terminate the employment of the Executive for Cause
unless and until the Executive receives a copy of a resolution duly adopted by
the affirmative vote of at least a majority of the Board finding that in the
good faith opinion of the Board, that “Cause” exists and specifying the
particulars thereof in reasonable detail.
 
9.2           Termination by Partnership without Cause
 
The Partnership may terminate the Executive’s employment without Cause at any
time by providing the Executive with a separation package (the “Separation
Package”) equal to one years’ Total Cash Compensation.
 
“Total Cash Compensation” is defined as the annualized amount of Base Salary
plus Bonus Payment for the prior 12-month period.
 
The Separation Package shall be payable in a lump sum within thirty (30) days of
termination.
 
9.3           Termination by the Executive for Good Reason
 
Should the Executive terminate his employment for Good Reason, as hereinafter
defined, he shall receive the Separation Package set out in section 9.2. Failure
of the Executive to terminate his employment on the occurrence of any event
which would constitute Good Reason shall not constitute waiver of his right
under this section 9.3. Notwithstanding the foregoing, Executive may terminate
his employment for Good Reason so long as Executive tenders his resignation to
the Partnership within thirty (30) days after the occurrence of the event that
forms the basis for the resignation for Good Reason; provided, however, that
Executive must provide written notice to the Partnership and Gran Tierra
describing the nature of the event that Executive believes forms the basis for
the resignation for Good Reason, and the Partnership and Gran Tierra shall
thereafter have ten (10) days to cure such event.
 
“Good Reason” is defined as the occurrence of any of the following without the
Executive’s express written consent:
 
(a)           adverse change in the Executive’s position, titles, duties or
responsibilities or any failure to re-elect or re-appoint him to any such
positions, titles, duties or offices, except in connection with the termination
of his employment for Cause;
 
(b)           a reduction by the Partnership of the Executive’s Be Salary except
to the extent that the annual base salaries of all other executive officers of
the Partnership or Gran Tierra are similarly reduced or any change in the basis
upon which the Executive’s annual compensation is determined or paid if the
change is or will be adverse to the Executive except that an award of annual
performance bonuses by Gran Tierra’s Compensation Committee (and approved by the
Board) are discretionary and in no instance shall be considered adverse to
Executive if such performance bonus is reduced from a prior year or if an annual
performance bonus is not paid;
 
 
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(c)           a Change Control (as defined below) of Gran Tierra occurs; or
 
(d)           any breach by the Partnership of any material provision of this
Agreement.
 
A “Change in Control” is defined as:
 
 
(a)
a dissolution, liquidation or sale of all or substantially all of the assets of
Gran Tierra;

 
 
(b)
a merger or consolidation in which Gran Tierra is not the surviving corporation;

 
 
(c)
a reverse merger in which Gran Tierra is the surviving corporation but the
shares of Gran Tierra’s common stock outstanding immediately preceding the
merger are converted by virtue of the merger into other property, whether in the
form of securities, cash or otherwise; or

 
 
(d)
the acquisition by any person, entity or group within the meaning of Section
13(d) or 14(d) of the Exchange Act, or any comparable successor provisions
(excluding any employee benefit plan, or related trust, sponsored or maintained
by Gran Tierra or any affiliate of Gran Tierra) of the beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act, or
comparable successor rule) of securities of Gran Tierra representing at least
fifty percent (50%) of the combined voting power entitled to vote in the
election of directors.

 
ARTICLE 10
DIRECTORS/OFFICERS LIABILITY
 
10.1           Indemnity
 
Gran Tierra shall provide to the Executive indemnification in accordance with
the Indemnification Agreement entered into between Gran Tierra and the
Executive.
 
10.2           Insurance
 
 
(a)
Gran Tierra shall purchase and maintain, throughout the period during which the
Executive acts as a director or officer of m Tierra or a Member Company and for
a period of two years after the date that the Executive ceases to act as a
director or officer of Gran Tierra or a Member Company, directors’ and officers’
liability insurance for the benefit of the Executive and the Executive’s heirs,
executors, administrators and other legal representatives, such that the
Executive’s insurance coverage is, at all times, at least equal to or better
than any insurance coverage Gran Tierra purchases and maintains for the benefit
of its then current directors and officers, from time to time.

 
 
(b)
If for any reason whatsoever, any directors’ and officers’ liability insurer
asserts that the Executive or the Executive’s heirs, executors, administrators
or other legal representatives are subject to a deductible under any existing or
future directors’ and officers’ liability insurance purchased and maintained by
Gran Tierra for the benefit of the Executive and the Executive’s heirs,
executors, administrators and other legal representatives, Gran Tierra shall pay
the deductible for and on behalf of the Executive or the Executive’s heirs,
executors, administrators or other legal representatives, as the case may be.

 
 
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10.3           Survival
 
The provisions of sections 10.1 and 10.2 of this Agreement shall survive the
termination of this Agreement or the employment of the Executive with the
Partnership and such provisions shall continue in full force and effect in
accordance with such Indemnification Agreement and the provisions of this
Agreement for the benefit of the Executive.
 
ARTICLE 11
NON-COMPETITION AND CONFIDENTIALITY
 
11.1           Non-Competition
 
The Executive recognizes and understands that in performing the duties and
responsibilities of his employment as outlined in this Agreement, he will be a
key employee of Partnership and will occupy a position of high fiduciary trust
and confidence, pursuant to which he has developed and will develop and acquire
wide experience and knowledge with respect to all aspects of the services and
businesses carried on by Gran Tierra and its Member Companies and the manner in
which such businesses are conducted. It is the expressed intent and agreement of
the Executive and of Partnership that such knowledge and experience shall used
solely and exclusively in the furtherance of the business interests of Gran
Tierra and its Member Companies and not in any manner detrimental to them. The
Executive therefore agrees that so long he is employed by the Partnership
pursuant to this Agreement he shall not engage in any practice or business in
competition with the business of Gran Tierra or any of its Member Companies.
 
11.2           Confidentiality
 
The Executive further recognizes and understands that in the performance of his
employment duties and responsibilities outlined in this Agreement, he will be a
key employee of the Partnership and will become knowledgeable, aware and
possessed of all confidential and proprietary information, know-how, data,
strategic studies, techniques, knowledge and other confidential information of
every kind or character relating to or connected with the business or corporate
affairs and operations of Gran Tierra and its Member Companies and includes,
without limitation, geophysical studies and data, market data, engineering
information, shareholder data, client lists, compensation rates and methods and
personnel information (collectively “Confidential Information”) concerning the
business of Gran Tierra and its Member Companies. The Executive therefore agrees
that, except with the consent of the Board, he will not disclose such
Confidential Information to any unauthorized persons so long as he is employed
by Partnership pursuant to this Agreement and for a period of 24 months
thereafter; provided that the foregoing shall not apply to any Confidential
Information which is or becomes known to the public or to the competitors of
Gran Tierra or its Member Companies other than by a breach of this Agreement.
 
11.3           Following Termination of Agreement
 
Subject to this provision and without otherwise restricting the fiduciary
obligations imposed upon, or otherwise applicable to the Executive as a result
of the Executive having been a senior officer and key employee of the
Partnership, the Executive shall not be prohibited from obtaining employment
with or otherwise forming or participating in a business competitive to the
business of Gran Tierra and its Member Companies after termination of this
Agreement and the Executive’s employment with the Partnership.
 
ARTICLE 12
CHANGES TO AGREEMENT; ASSIGNMENT
 
Any modifications or amendments to this Agreement must be in writing and signed
by all parties or else they shall have no force and effect. Notwithstanding the
foregoing, the Partnership may assign this agreement to Gran Tierra or any
Member Company, without the consent of the Executive.
 
 
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ARTICLE 13
ENUREMENT
 
This Agreement shall enure to the benefit of and be binding upon the Parties and
their respective successors and assigns, including without limitation, the
Executive’s heirs, executors, administrators and personal representatives.
 
ARTICLE 14
GOVERNING LAW
 
This Agreement shall be construed in accordance with the laws of the Province of
Alberta and the laws of Canada applicable therein.
 
ARTICLE 15
NOTICES
 
15.1           Notice to Executive.
 
Any notice required or permitted to be given to the Executive shall be deemed to
have been received if delivered personally to the Executive or sent by courier
to the Executive’s home address last known to the Partnership.
 
15.2           Notice to Partnership or Gran Tierra.
 
Any notice required or permitted to be given to the Partnership or m Tierra
shall be deemed to have been received if delivered personally to, sent by
courier, or sent by facsimile to:
 
Gran Tierra Energy Inc.
300, 611-10th Avenue S.W.
Calgary, Alberta, Canada T2R 0B2
Fax: (403) 265-3242
Attn: President and Chief Executive Officer
 
ARTICLE 16
WITHHOLDING
 
All payments made by the Partnership to the Executive or for the benefit of the
Executive shall be less applicable withholdings and deductions.
 
ARTICLE 17
INDEPENDENT LEGAL ADVICE
 
The Executive acknowledges that the Executive has been advised to obtain
independent legal advice with respect to entering into this Agreement, that he
has obtained such independent legal advice or has expressly deemed not to seek
such advice, and that the Executive is entering into this Agreement with full
knowledge of the contents hereof, of the Executive’s own free will and with full
capacity and authority to do so.
 
 
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IN WITNESS WHEREOF, the parties have executed this Agreement.
 
Gran Tierra Energy Inc.
 
Gran Tierra Cayman Islands Inc., a Cayman Islands
Company, for itself and for the Partnership as the general
manager of GTE
By:
/s/Dana Coffield
 
Colombia Holdings LLC, the sole owner of
 
Dana Coffield
 
Argosy Energy LLC, general partner of the
Title: President and CEO
 
Partnership
Date: 13 Nov 09
       
By:
/s/ Dana Coffield
     
Dana Coffield
   
Title: Director
   
Date: 13 Nov 09
     
Executive
 
Witness
      /s/ Julian Garcia   /s/ Martin Eden
Julian Antonio Garcia Salcedo
 
By: Martin Eden
Date: 23 Nov 09
 
Date Nov 23, 2009

 
 
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