AND
LEGALLY OF RECORD BY JEANNETTE VANESSA DURAND CASTRO.
(IV)
AS OF JUNE 30, 2008, BPZ ENERGY INC. HAS
ADVANCED US$98,020,710.49 TO BPZ EXPLORACIÓN AND $0 TO BPZ MARINE PURSUANT TO
PERMITTED PARTNER SUBORDINATED LOANS.
(V)
EXCEPT AS DESCRIBED IN CLAUSES (I) THROUGH
(IV) ABOVE, THERE DO NOT EXIST ANY ADVANCES TO EITHER BORROWER, OR AUTHORIZED OR
OUTSTANDING PARTICIPATIONS, SECURITIES, OPTIONS, WARRANTS, CALLS, COMMITMENTS,
RIGHTS TO SUBSCRIBE OR OTHER INSTRUMENTS, AGREEMENTS OR RIGHTS OF ANY CHARACTER,
OR ANY PRE-EMPTIVE RIGHTS, CONVERTIBLE INTO OR EXCHANGEABLE FOR, OR RELATING TO
THE ISSUANCE, TRANSFER OR SALE OF, ANY CAPITAL OF EITHER BORROWER.
(C)
VALIDITY
Each Transaction Document to which such Borrower is a party has been duly
authorized, executed and delivered by such Borrower and constitutes a valid and
36
legally binding obligation of such Borrower, enforceable in accordance with its
terms.
(D)
NO CONFLICT
Neither the entry into, nor its compliance with or the performance of the terms
and conditions under, nor the making or delivery of, any Transaction Document to
which such Borrower is a party will (including after giving effect to any
Disbursement):
(I)
CONFLICT WITH OR RESULT IN A BREACH OF
ANY OF THE TERMS, CONDITIONS OR PROVISIONS OF, OR CONSTITUTE A DEFAULT (OR AN
EVENT WHICH, WITH THE GIVING OF NOTICE, OR THE PASSAGE OF TIME WOULD CONSTITUTE
A DEFAULT) OR REQUIRE ANY CONSENT UNDER, ANY INDENTURE, MORTGAGE, AGREEMENT OR
OTHER INSTRUMENT OR ARRANGEMENT TO WHICH SUCH BORROWER IS A PARTY OR BY WHICH
SUCH BORROWER OR ANY OF ITS ASSETS IS BOUND, EXCEPT TO THE EXTENT THAT ANY SUCH
CONFLICT, BREACH OR DEFAULT COULD NOT REASONABLY BE EXPECTED TO HAVE A MATERIAL
ADVERSE EFFECT;
(II)
RESULT IN THE IMPOSITION OF ANY LIEN
(OTHER THAN PERMITTED LIENS) UNDER ANY AGREEMENT OR INSTRUMENT TO WHICH SUCH
BORROWER IS A PARTY OR BY WHICH SUCH BORROWER OR ANY OF ITS ASSETS IS BOUND; OR
(III)
VIOLATE IN ANY MATERIAL RESPECT ANY OF THE
TERMS OR PROVISIONS OF SUCH BORROWER'S CHARTER OR ANY AUTHORIZATION, JUDGMENT,
DECREE OR ORDER OR ANY STATUTE, RULE OR REGULATION APPLICABLE TO SUCH BORROWER.
(E)
STATUS OF AUTHORIZATIONS
(I)
THE AUTHORIZATIONS SPECIFIED IN SCHEDULE
3 (AUTHORIZATIONS) ARE ALL THE AUTHORIZATIONS (OTHER THAN AUTHORIZATIONS THAT
ARE OF A ROUTINE NATURE AND ARE OBTAINED IN THE ORDINARY COURSE OF BUSINESS)
NEEDED BY THE BORROWERS ON THE DATE HEREOF TO CONDUCT THEIR RESPECTIVE BUSINESS,
CARRY OUT THE PROJECT AND EXECUTE, AND COMPLY WITH ITS OBLIGATIONS UNDER, THIS
AGREEMENT AND EACH OF THE OTHER TRANSACTION DOCUMENTS TO WHICH IT IS A PARTY;
(II)
ALL AUTHORIZATIONS SPECIFIED IN SECTION 1
(AUTHORIZATIONS ALREADY OBTAINED) AND, WITH RESPECT TO ANY DISBURSEMENT
FOLLOWING THE FIRST DISBURSEMENT, SECTION 2 (AUTHORIZATIONS TO BE OBTAINED PRIOR
TO FIRST DISBURSEMENT) OF SCHEDULE 3 (AUTHORIZATIONS) HAVE BEEN OBTAINED AND ARE
IN FULL FORCE AND EFFECT;
(III)
WITH RESPECT TO THE FIRST DISBURSEMENT, THE
BORROWERS HAVE APPLIED (OR ARE MAKING ARRANGEMENTS TO APPLY) FOR ALL
AUTHORIZATIONS SPECIFIED IN SECTION 2 (AUTHORIZATIONS TO BE OBTAINED PRIOR TO
FIRST DISBURSEMENT) OF SCHEDULE