Document:

Exhibit
10.2

    
      
        
          

        

      

      

        
          

        

         

      

    

    $200,000,000

    REVOLVING
CREDIT  FACILITY

    
    

    
      

    

     

    GRAN
TIERRA ENERGY COLOMBIA, LTD.

    (formerly
Argosy Energy International),

    ARGOSY
ENERGY, LLC

    (formerly
Argosy Energy Corp.),

    SOLANA
PETROLEUM EXPLORATION (COLOMBIA) LIMITED

    and

    SOLANA
RESOURCES LIMITED,

    as
Original Guarantors

    

    GRAN
TIERRA ENERGY CAYMAN ISLANDS INC.,

    as
Borrower

     

    THE
LENDERS PARTY HERETO FROM TIME TO TIME,

    as
Banks

     

    
      

    

    
    

    AMENDED
AND RESTATED CREDIT

    AGREEMENT

    

    Dated as
of August 24, 2009

     

    
      

    

     

    STANDARD
BANK PLC,

    as
Arranger, Administrative Agent

    and
Issuing Bank

    
      
         

      

      
        i

        
          

        

      

      
         

      

    

    

    
      
        
          
            
              	
                      Section
      1.

                    	 
      	
                      DEFINITIONS
      AND ACCOUNTING MATTERS

                    	 	
                      2

                    
	 
      	 
      	 
      	 	 
      
	
                      1.01

                    	 
      	
                      Certain
      Defined Terms

                    	 	
                      2

                    
	 
      	 
      	 
      	 	 
      
	
                      1.02

                    	 
      	
                      Accounting
      Terms and Determinations

                    	 	
                      27

                    
	 
      	 
      	 
      	 	 
      
	
                      1.03

                    	 
      	
                      Borrowing
      Base

                    	 	
                      27

                    
	 
      	 
      	 
      	 	 
      
	
                      1.04

                    	 
      	
                      Designation
      of Subsidiaries as Restricted or Unrestricted Subsidiaries

                    	 	
                      31

                    
	 
      	 
      	 
      	 	 
      
	
                      1.05

                    	 
      	
                      Restricted
      Subsidiaries Not Directly or Indirectly Owned or Controlled by the
      Borrower

                    	 	
                      32

                    
	 
      	 
      	 
      	 	 
      
	
                      Section
      2.

                    	 
      	
                      COMMITMENTS,
      LOANS, NOTES AND PREPAYMENTS

                    	 	
                      32

                    
	 
      	 
      	 
      	 	 
      
	
                      2.01

                    	 
      	
                      Loans

                    	 	
                      32

                    
	 
      	 
      	 
      	 	 
      
	
                      2.02

                    	 
      	
                      Borrowings

                    	 	
                      32

                    
	 
      	 
      	 
      	 	 
      
	
                      2.03

                    	 
      	
                      Letters
      of Credit

                    	 	
                      33

                    
	 
      	 
      	 
      	 	 
      
	
                      2.04

                    	 
      	
                      Changes
      of Commitments

                    	 	
                      37

                    
	 
      	 
      	 
      	 	 
      
	
                      2.05

                    	 
      	
                      Commitment
      Fee

                    	 	
                      37

                    
	 
      	 
      	 
      	 	 
      
	
                      2.06

                    	 
      	
                      Lending
      Offices

                    	 	
                      37

                    
	 
      	 
      	 
      	 	 
      
	
                      2.07

                    	 
      	
                      Several
      Obligations; Remedies Independent

                    	 	
                      38

                    
	 
      	 
      	 
      	 	 
      
	
                      2.08

                    	 
      	
                      Notes

                    	 	
                      38

                    
	 
      	 
      	 
      	 	 
      
	
                      2.09

                    	 
      	
                      Optional
      Prepayments of Loans

                    	 	
                      38

                    
	 
      	 
      	 
      	 	 
      
	
                      2.10

                    	 
      	
                      Mandatory
      Prepayments

                    	 	
                      39

                    
	 
      	 
      	 
      	 	 
      
	
                      Section
      3.

                    	 
      	
                      PAYMENTS
      OF PRINCIPAL AND INTEREST

                    	 	
                      41

                    
	 
      	 
      	 
      	 	 
      
	
                      3.01

                    	 
      	
                      Repayment
      of Loans

                    	 	
                      41

                    
	 
      	 
      	 
      	 	 
      
	
                      3.02

                    	 
      	
                      [Intentionally
      Omitted]

                    	 	
                      41

                    
	 
      	 
      	 
      	 	 
      
	
                      3.03

                    	 
      	
                      Interest

                    	 	
                      41

                    
	 
      	 
      	 
      	 	 
      
	
                      3.04

                    	 
      	
                      Solvency

                    	 	
                      42

                    
	 
      	 
      	 
      	 	 
      
	
                      Section
      4.

                    	 
      	
                      PAYMENTS;
      PRO RATA TREATMENT; COMPUTATIONS; ETC

                    	 	
                      42

                    
	 
      	 
      	 
      	 	 
      
	
                      4.01

                    	 
      	
                      Payments

                    	 	
                      42

                    
	 
      	 
      	 
      	 	 
      
	
                      4.02

                    	 
      	
                      Pro
      Rata Treatment

                    	 	
                      43

                    
	 
      	 
      	 
      	 	 
      
	
                      4.03

                    	 
      	
                      Computations

                    	 	
                      43

                    
	 
      	 
      	 
      	 	 
      
	
                      4.04

                    	 
      	
                      Minimum
      Amounts

                    	 	
                      44

                    
	 
      	 
      	 
      	 	 
      
	
                      4.05

                    	 
      	
                      Certain
      Notices

                    	 	
                      44

                    
	 
      	 
      	 
      	 	 
      
	
                      4.06

                    	
                        

                    	
                      [Intentionally
      Omitted]

                    	 	
                      44

                    

            

          

        

      

    

    
      
         

      

      
        ii

        
          

        

      

      
         

      

    

    

    
      
        
          
            	
                    4.07

                  	 
      	
                    Non-Receipt
      of Funds by the Administrative Agent

                  	 
      	
                    45

                  
	 
      	 
      	 
      	 
      	 
      
	
                    4.08

                  	 
      	
                    Sharing
      of Payments, etc

                  	 
      	
                    45

                  
	 
      	 
      	 
      	 
      	 
      
	
                    4.09

                  	 
      	
                    Maximum
      Rate Permitted by Law

                  	 
      	
                    47

                  
	 
      	 
      	 
      	 
      	 
      
	
                    Section
      5.

                  	 
      	
                    YIELD
      PROTECTION, ETC

                  	 
      	
                    47

                  
	 
      	 
      	 
      	 
      	 
      
	
                    5.01

                  	 
      	
                    Additional
      Costs

                  	 
      	
                    47

                  
	 
      	 
      	 
      	 
      	 
      
	
                    5.02

                  	 
      	
                    Limitation
      on Types of Loans

                  	 
      	
                    50

                  
	 
      	 
      	 
      	 
      	 
      
	
                    5.03

                  	 
      	
                    Illegality

                  	 
      	
                    51

                  
	 
      	 
      	 
      	 
      	 
      
	
                    5.04

                  	 
      	
                    Compensation

                  	 
      	
                    51

                  
	 
      	 
      	 
      	 
      	 
      
	
                    5.05

                  	 
      	
                    Additional
      Costs in Respect of Letters of Credit

                  	 
      	
                    52

                  
	 
      	 
      	 
      	 
      	 
      
	
                    5.06

                  	 
      	
                    Taxes;
      Loans and Reimbursement Obligations

                  	 
      	
                    52

                  
	 
      	 
      	 
      	 
      	 
      
	
                    5.07

                  	 
      	
                    Replacement
      of Banks

                  	 
      	
                    55

                  
	 
      	 
      	 
      	 
      	 
      
	
                    Section
      6.

                  	 
      	
                    GUARANTEE

                  	 
      	
                    55

                  
	 
      	 
      	 
      	 
      	 
      
	
                    6.01

                  	 
      	
                    Guarantee

                  	 
      	
                    55

                  
	 
      	 
      	 
      	 
      	 
      
	
                    6.02

                  	 
      	
                    Obligations
      Unconditional

                  	 
      	
                    56

                  
	 
      	 
      	 
      	 
      	 
      
	
                    6.03

                  	 
      	
                    Reinstatement

                  	 
      	
                    57

                  
	 
      	 
      	 
      	 
      	 
      
	
                    6.04

                  	 
      	
                    Subrogation

                  	 
      	
                    57

                  
	 
      	 
      	 
      	 
      	 
      
	
                    6.05

                  	 
      	
                    Remedies

                  	 
      	
                    57

                  
	 
      	 
      	 
      	 
      	 
      
	
                    6.06

                  	 
      	
                    Continuing
      Guarantee

                  	 
      	
                    57

                  
	 
      	 
      	 
      	 
      	 
      
	
                    6.07

                  	 
      	
                    Instrument
      for the Payment of Money

                  	 
      	
                    57

                  
	 
      	 
      	 
      	 
      	 
      
	
                    6.08

                  	 
      	
                    Rights
      of Contribution

                  	 
      	
                    57

                  
	 
      	 
      	 
      	 
      	 
      
	
                    6.09

                  	 
      	
                    General
      Limitation on Guarantee Obligations

                  	 
      	
                    58

                  
	 
      	 
      	 
      	 
      	 
      
	
                    Section
      7.

                  	 
      	
                    CONDITIONS
      PRECEDENT

                  	 
      	
                    58

                  
	 
      	 
      	 
      	 
      	 
      
	
                    7.01

                  	 
      	
                    Original
      Closing Date

                  	 
      	
                    58

                  
	 
      	 
      	 
      	 
      	 
      
	
                    7.02

                  	 
      	
                    Closing
      Date

                  	 
      	
                    58

                  
	 
      	 
      	 
      	 
      	 
      
	
                    7.03

                  	 
      	
                    Effectiveness
      and Subsequent Extensions of Credit

                  	 
      	
                    61

                  
	 
      	 
      	 
      	 
      	 
      
	
                    Section
      8.

                  	 
      	
                    REPRESENTATIONS
      AND WARRANTIES

                  	 
      	
                    61

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.01

                  	 
      	
                    Corporate
      Existence

                  	 
      	
                    61

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.02

                  	 
      	
                    Financial
      Condition

                  	 
      	
                    62

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.03

                  	 
      	
                    Litigation

                  	 
      	
                    62

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.04

                  	
                      

                  	
                    No
      Breach

                  	
                      

                  	
                    62

                  

          

        

      

    

    
      
         

      

      
        iii

        
          

        

      

      
         

      

    

    

    
      
        
          
            	
                    8.05

                  	 
      	
                    Action

                  	 
      	
                    63

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.06

                  	 
      	
                    Approvals

                  	 
      	
                    63

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.07

                  	 
      	
                    Use
      of Credit

                  	 
      	
                    63

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.08

                  	 
      	
                    Taxes

                  	 
      	
                    63

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.09

                  	 
      	
                    Compliance
      with Laws and Agreements

                  	 
      	
                    64

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.10

                  	 
      	
                    Environmental
      Matters

                  	 
      	
                    64

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.11

                  	 
      	
                    Subsidiaries,
      etc

                  	 
      	
                    66

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.12

                  	 
      	
                    True
      and Complete Disclosure

                  	 
      	
                    67

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.13

                  	 
      	
                    Title
      to Properties

                  	 
      	
                    67

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.14

                  	 
      	
                    Capitalization

                  	 
      	
                    67

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.15

                  	 
      	
                    Insurance

                  	 
      	
                    68

                  
	 
      	 
      	 
      	 
      	 
      
	
                    8.16

                  	 
      	
                    ERISA

                  	 
      	
                    68

                  
	 
      	 
      	 
      	 
      	 
      
	
                    Section
      9.

                  	 
      	
                    COVENANTS
      OF THE OBLIGORS

                  	 
      	
                    68

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.01

                  	 
      	
                    Financial
      Statements, Etc

                  	 
      	
                    68

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.02

                  	 
      	
                    Litigation

                  	 
      	
                    70

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.03

                  	 
      	
                    Existence,
      Etc

                  	 
      	
                    71

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.04

                  	 
      	
                    Insurance

                  	 
      	
                    72

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.05

                  	 
      	
                    Prohibition
      of Fundamental Changes; Disposition of Assets

                  	 
      	
                    72

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.06

                  	 
      	
                    Limitation
      on Liens

                  	 
      	
                    74

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.07

                  	 
      	
                    Indebtedness

                  	 
      	
                    77

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.08

                  	 
      	
                    Investments

                  	 
      	
                    79

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.09

                  	 
      	
                    Dividend
      Payments

                  	 
      	
                    80

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.10

                  	 
      	
                    Financial
      Covenants

                  	 
      	
                    81

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.11

                  	 
      	
                    Collection
      Accounts

                  	 
      	
                    81

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.12

                  	 
      	
                    Lines
      of Business

                  	 
      	
                    82

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.13

                  	 
      	
                    Transactions
      with Affiliates

                  	 
      	
                    82

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.14

                  	 
      	
                    Use
      of Proceeds

                  	 
      	
                    82

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.15

                  	 
      	
                    Certain
      Obligations Respecting Subsidiaries

                  	 
      	
                    83

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.16

                  	 
      	
                    Additional
      Subsidiary Guarantors

                  	 
      	
                    83

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.17

                  	
                      

                  	
                    Unrestricted
      Subsidiaries

                  	
                      

                  	
                    84

                  

          

        

      

    

    
      
         

      

      
        iv

        
          

        

      

      
         

      

    

    

    
      
        
          
            	
                    9.18

                  	 
      	
                    Limitations
      on Sale and Leaseback Transactions

                  	 
      	
                    84

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.19

                  	 
      	
                    Environmental
      Matters

                  	 
      	
                    84

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.20

                  	 
      	
                    No
      Action to Affect Security Documents

                  	 
      	
                    85

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.21

                  	 
      	
                    Visits
      to Properties

                  	 
      	
                    85

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.22

                  	 
      	
                    Title
      Defects

                  	 
      	
                    85

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.23

                  	 
      	
                    Offtake
      Agreements

                  	 
      	
                    86

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.24

                  	 
      	
                    Further
      Assurances

                  	 
      	
                    86

                  
	 
      	 
      	 
      	 
      	 
      
	
                    9.25

                  	 
      	
                    Activities
      of Holding Companies

                  	 
      	
                    86

                  
	 
      	 
      	 
      	 
      	 
      
	
                    Section
      10.

                  	 
      	
                    EVENTS
      OF DEFAULT

                  	 
      	
                    87

                  
	 
      	 
      	 
      	 
      	 
      
	
                    Section
      11.

                  	 
      	
                    THE
      ADMINISTRATIVE AGENT

                  	 
      	
                    91

                  
	 
      	 
      	 
      	 
      	 
      
	
                    11.01

                  	 
      	
                    Appointment,
      Powers and Immunities

                  	 
      	
                    91

                  
	 
      	 
      	 
      	 
      	 
      
	
                    11.02

                  	 
      	
                    Reliance
      by Administrative Agent

                  	 
      	
                    92

                  
	 
      	 
      	 
      	 
      	 
      
	
                    11.03

                  	 
      	
                    Defaults

                  	 
      	
                    92

                  
	 
      	 
      	 
      	 
      	 
      
	
                    11.04

                  	 
      	
                    Rights
      as a Bank

                  	 
      	
                    93

                  
	 
      	 
      	 
      	 
      	 
      
	
                    11.05

                  	 
      	
                    Indemnification

                  	 
      	
                    93

                  
	 
      	 
      	 
      	 
      	 
      
	
                    11.06

                  	 
      	
                    Non-Reliance
      on Agent and Other Banks

                  	 
      	
                    93

                  
	 
      	 
      	 
      	 
      	 
      
	
                    11.07

                  	 
      	
                    Failure
      to Act

                  	 
      	
                    94

                  
	 
      	 
      	 
      	 
      	 
      
	
                    11.08

                  	 
      	
                    Resignation
      or Removal of Agent

                  	 
      	
                    94

                  
	 
      	 
      	 
      	 
      	 
      
	
                    11.09

                  	 
      	
                    Consents
      under Other Loan Documents

                  	 
      	
                    94

                  
	 
      	 
      	 
      	 
      	 
      
	
                    11.10

                  	 
      	
                    Collateral
      Sub-Agents

                  	 
      	
                    95

                  
	 
      	 
      	 
      	 
      	 
      
	
                    11.11

                  	 
      	
                    Dealings
      With the Administrative Agent

                  	 
      	
                    95

                  
	 
      	 
      	 
      	 
      	 
      
	
                    Section
      12.

                  	 
      	
                    MISCELLANEOUS

                  	 
      	
                    95

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.01

                  	 
      	
                    Waiver

                  	 
      	
                    95

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.02

                  	 
      	
                    Notices

                  	 
      	
                    95

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.03

                  	 
      	
                    Expenses

                  	 
      	
                    96

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.04

                  	 
      	
                    Amendments,
      Etc

                  	 
      	
                    97

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.05

                  	 
      	
                    Successors
      and Assigns

                  	 
      	
                    98

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.06

                  	 
      	
                    Assignments
      and Participations

                  	 
      	
                    98

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.07

                  	 
      	
                    Indemnification

                  	 
      	
                    101

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.08

                  	
                      

                  	
                    Survival

                  	
                      

                  	
                    102

                  

          

        

      

    

    
      
         

      

      
        v

        
          

        

      

      
         

      

    

    

    
      
        
          
            	
                    12.09

                  	 
      	
                    Captions

                  	 
      	
                    102

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.10

                  	 
      	
                    Counterparts

                  	 
      	
                    102

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.11

                  	 
      	
                    Governing
      Law; Submission to Jurisdiction; Waiver of Immunity

                  	 
      	
                    102

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.12

                  	 
      	
                    Waiver
      of Jury Trial

                  	 
      	
                    103

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.13

                  	 
      	
                    Treatment
      of Certain Information

                  	 
      	
                    103

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.14

                  	 
      	
                    Judgment
      Currency

                  	 
      	
                    104

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.15

                  	 
      	
                    Agent
      for Service of Process

                  	 
      	
                    104

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.16

                  	 
      	
                    Entire
      Agreement

                  	 
      	
                    104

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.17

                  	 
      	
                    USA
      PATRIOT Act Notice

                  	 
      	
                    105

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.18

                  	 
      	
                    English
      Language

                  	 
      	
                    105

                  
	 
      	 
      	 
      	 
      	 
      
	
                    12.19

                  	
                      

                  	
                    Amended
      and Restated Credit Agreement

                  	
                      

                  	
                    105

                  

          

        

      

    

     

    
      
        
          
            
              
                
                  
                    
                      	
                              Annex
      I

                            	 
      	
                              Annex
      I-1

                            
	
                              Annex
      II

                            	 
      	
                              Annex
      II-1

                            
	
                              Schedule
      I

                            	 
      	
                              Schedule
      I-1

                            
	
                              Schedule
      II

                            	 
      	
                              Schedule
      II-1

                            
	
                              Schedule
      III

                            	 
      	
                              Schedule
      III-1

                            
	
                              Schedule
      IV

                            	 
      	
                              Schedule
      IV-1

                            
	
                              Schedule
      V

                            	 
      	
                              Schedule
      V-1

                            
	
                              Schedule
      VI

                            	 
      	
                              Schedule
      VI-1

                            
	
                              Schedule
      VII

                            	 
      	
                              Schedule
      VII-1

                            
	
                              Schedule
      VIII

                            	 
      	
                              Schedule
      VIII-1

                            
	
                              Schedule
      IX

                            	
                                

                            	
                              Schedule
      IX-1

                            

                    

                  

                

              

            

          

        

      

    

    
      
         

      

      
        vi

        
          

        

      

      
         

      

    

    AMENDED
AND RESTATED CREDIT AGREEMENT dated as of August 24, 2009 (this “Agreement”), among
GRAN TIERRA ENERGY COLOMBIA, LTD. (formerly Argosy Energy International), a
limited partnership organized under the laws of the State of Utah (Registered
No. 2110646-0180) and having its principal office at Calle 114 No. 7 - 80, 17th
Floor, AR Building, Bogota D. C., Colombia (the “Partnership”), ARGOSY
ENERGY, LLC (formerly Argosy Energy Corp.), a limited liability company
organized under the laws of the State of Delaware (Registered No. 3234977) (the
“GP”), SOLANA
PETROLEUM EXPLORATION (COLOMBIA) LIMITED, an exempted company organized under
the laws of the Cayman Islands (“Solana Petroleum”),
SOLANA RESOURCES LIMITED, a limited company organized under the laws of the
Province of Alberta, Canada (“Solana Resources”)
(the Partnership, the GP, Solana Petroleum and Solana Resources, collectively,
the “Original
Guarantors”, and individually, each an “Original Guarantor”),
GRAN TIERRA ENERGY CAYMAN ISLANDS INC., an exempted company organized under the
laws of the Cayman Islands (Registered No. MC-213331) and having its principal
office at PO Box 309 GT, Ugland House, South Church Street, George Town, Grand
Cayman, KY1-1104, Cayman Islands (the “Borrower”), each
Subsidiary, if any, of the Borrower that becomes a Guarantor pursuant to Section 9.16 hereof
(individually, a “Subsidiary Guarantor”
and, collectively, the “Subsidiary
Guarantors” and, together with the Borrower and the Original Guarantors,
the “Obligors”
and individually, an “Obligor”); each of
the lenders that is a signatory hereto identified under the caption “BANKS” on
the signature pages hereto or which, pursuant to Section 12.06(b)
hereof, shall become a “Bank” hereunder (individually, a “Bank” and,
collectively, the “Banks”); STANDARD
BANK PLC as the letter of credit issuing bank (the “Issuing Bank”), as
arranger (the “Arranger”) and as
administrative agent for the Banks (in such capacity, together with its
successors in such capacity, the “Administrative
Agent”).

     

    WHEREAS,
the Partnership, the GP, Gran Tierra Energy Inc., a Nevada corporation
(Registered No. C13734-2003) (the “Original Borrower”),
the lenders party thereto and Standard Bank Plc, as agent, are parties to that
certain Credit Agreement, dated as of February 22, 2007, as amended by Amendment
No. 1 to Credit Agreement dated as of January 1, 2009 (as amended, supplemented
or otherwise modified through the date hereof, the “Original Credit
Agreement”);

     

    WHEREAS,
pursuant to the Assignment and Assumption Agreement, dated as of August 24,
2009, the Original Borrower assigned and transferred all of its rights and
obligations under the Original Credit Agreement and the other Loan Documents (as
defined in the Original Credit Agreement) to the Borrower, its wholly owned
subsidiary, and the parties hereto have agreed that the Original Credit
Agreement be amended, restated and replaced, and pursuant to the terms and
conditions hereof.

     

    NOW,
THEREFORE, in consideration of the foregoing premises and mutual covenants
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each of the parties hereto hereby
agree as follows:

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

     

    SECTION
1.

    DEFINITIONS
AND ACCOUNTING MATTERS.

     

    1.01  Certain Defined
Terms.  As used herein, the following terms shall have the
following meanings (all terms defined in this Section 1.01 or in
other provisions of this Agreement in the singular to have the same meanings
when used in the plural and vice
versa):

     

    “Additional Costs”
shall have the meaning given to such term in Section 5.01(a)
hereof.

     

    “Administrative Agent”
shall have the meaning given to such term in the preamble hereof.

     

    “Administrative
Questionnaire” shall mean an administrative questionnaire in a form
supplied by the Administrative Agent.

     

    “Advance Date” shall
have the meaning given to such term in Section 4.07
hereof.

     

    “Affiliate” shall
mean, with respect to a specified Person, another Person that directly or
indirectly controls, or is under common control with, or is controlled by, the
Person specified.  As used in this definition, “control” (including,
with its correlative meanings, “controlled by” and “under common control with”)
shall mean possession, directly or indirectly, of power to direct or cause the
direction of management or policies (whether through ownership of securities or
partnership or other ownership interests, by contract or otherwise); provided that, in any
event, any Person that owns directly or indirectly securities having 10% or more
of the voting power for the election of directors or other governing body of a
corporation or 10% or more of the partnership or other ownership interests of
any other Person (other than as a limited partner of such other Person) shall be
deemed to control such corporation or other Person.  Notwithstanding
the foregoing, (a) no individual shall be an Affiliate solely by reason of his
or her being a director, officer or employee of the Borrower or any of its
Subsidiaries and (b) none of the Restricted Subsidiaries of the Borrower shall
be, for purposes of this definition, Affiliates of the Borrower, nor shall the
Borrower be, for purposes of this definition, an Affiliate of any of its
Restricted Subsidiaries.

     

    “Applicable Commitment Fee
Rate” shall mean 1.00% per annum.

     

    “Applicable Lending
Office” shall mean, for each Bank, the “Lending Office” of such Bank (or
of an Affiliate of such Bank) designated in the Administrative Questionnaire of
such Bank or such other office of such Bank (or of an Affiliate of such Bank) as
such Bank may from time to time specify to the Administrative Agent and the
Borrower as the office from which its Loans are to be made and
maintained.

     

    “Applicable Margin”
shall mean with respect to any Loan, 4.00% per annum.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    “Arranger” shall have
the meaning given to such term in the preamble hereof.

     

    “Bank” shall have the
meaning given to such term in the preamble hereof.

     

    “Borrower” shall have
the meaning given to such term in the preamble hereof.

     

    “Borrowing Base” shall
mean the lower of (a) $200,000,000 and (b) the Present Value of Reserves, as the
same may be redetermined from time to time in accordance with Section 1.03(b), and
subject to adjustments, redeterminations and the principles set forth in Sections 1.03(c),
1.03(d), 1.03(e), 2.10 and 9.22 hereof; provided that,
notwithstanding anything to the contrary in this Agreement, for the period from
(and including) the Closing Date to (but excluding) the Step-Up Date, the
Borrowing Base shall not exceed $7,000,000 (notwithstanding the fact that the
Present Value of Reserves on the Closing Date is estimated to be
$120,000,000).

     

    “Borrowing Base
Deficiency” shall have the meaning given to such term in Section 2.10(a)
hereof.

     

    “Business Day” shall
mean any day (other than a Saturday or Sunday) (a) on which commercial banks are
open for general business in New York, London and Calgary, and (b) on which
dealings in Dollar deposits are carried out between banks in the London
interbank market.

     

    “Capital Expenditures”
shall mean, for any period, expenditures (including, without limitation, the
aggregate amount of Capital Lease Obligations payable during such period) made
by the Borrower or any of its Restricted Subsidiaries in connection with the
acquisition and exploitation of, or the exploration for or development or
production of, Hydrocarbon reserves or to acquire or construct fixed assets,
plant and equipment (including renewals, improvements and replacements, but
excluding repairs) during such period computed in accordance with
GAAP.

     

    “Capital Lease
Obligations” shall mean, for any Person, all obligations of such Person
to pay rent or other amounts under a lease of (or other agreement conveying the
right to use) Property to the extent such obligations are required to be
classified and accounted for as a capital lease on a balance sheet of such
Person under GAAP, and, for purposes of this Agreement, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP.

     

    “Capital Stock” shall
mean, with respect to any Person, any and all shares, interests, participations
or other equivalents (however designated) of corporate stock or membership,
limited liability company, limited liability partnership or partnership
interests and any and all warrants, options and rights with respect thereto
(whether or not currently exercisable), including each class of common stock and
preferred stock of such Person.

     

    “Casualty Event” shall
mean, with respect to any Property of any Person, any loss of or damage to, or
any condemnation or other taking of, such Property for which such Person or any
of its Subsidiaries receives insurance proceeds, or proceeds of a condemnation
award or other compensation.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    “Change of Control”
shall mean the failure by the Parent to own and control, of record and
beneficially, directly or indirectly, (a) 100% of each class of outstanding
Capital Stock of the Borrower or (b) 100% of each class of outstanding Capital
Stock of Solana Resources and Solana Petroleum, in each case free and clear of
all Liens.

     

    “Closing Date” shall
mean the date upon which all of the conditions of Section 7.02 hereof
are either satisfied or waived.

     

    “Collection Accounts”
shall mean the GTE Collection Account and the Solana Collection
Account.

     

    “Collection Account Pledge
Agreements” shall mean the GTE Collection Account Pledge Agreement and
the Solana Collection Account Pledge Agreement.

     

    “Colombia” shall mean
The Republic of Colombia.

     

    “Colombian Branches”
shall mean, collectively, the GTE Colombian Branch and the Solana Colombian
Branch.

     

    “Colombian Credit
Investments” shall mean (a) government bonds issued by the Colombian
Treasury (“Titulos de Deuda de Tesoreria” or “TES”) rated AAA or above by Duff
and Phelps, (b) short-term certificates of deposit (“Certificado de Deposito a
Termino” or “CDTs”) rated AA+ or above by Duff and Phelps, and (c) Colombia tax
credit certificates (“Certificados de Reembolso Tributario” or “CERTs”) rated
AA+ or above by Duff & Phelps.

     

    “Colombian Hydrocarbon
Properties” shall mean (a) as of the date of this Agreement, the
following Hydrocarbon Properties: (i) the Guayuyaco Block, located in the
Putumayo Basin in Colombia, (ii) the Santana Block, located in the Putumayo
Basin in Colombia, and (iii) the Hydrocarbon Properties set forth on Schedule X;
and (b) from time to time and at any time hereafter, all Hydrocarbon Properties
in Colombia in which the Borrower or any of its Restricted Subsidiaries shall
have an interest and that have been included in the Borrowing Base pursuant to
Section
1.03.

     

    “Colombian Security
Documents” shall mean each of the following documents:

     

    (a)           a
receivables pledge agreement governed by the laws of Colombia, dated as of the
Original Closing Date (as the same may be amended, restated, substituted or
supplemented from time to time), in form and substance satisfactory to the
Administrative Agent, granting in favor of the Administrative Agent for the
ratable benefit of the Secured Parties a first-priority security interest in
substantially all of the present and future right, title and interest of the GTE
Colombian Branch to receivables payable from time to time by each
Offtaker;

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    
      (b)           each
receivables payment instruction letter governed by the laws of Colombia,
instructing the Offtaker named therein to make payments due to the GTE Colombian
Branch under the applicable Offtake Agreement to the relevant Collection
Account;

       

      (c)           the
Solana Security Documents; and

       

      (d)           any
other document reasonably required by the Administrative Agent to be executed in
connection with the creation, attachment and/or perfection under the laws of
Colombia of the security interests to be granted pursuant to the aforementioned
security documents.

       

      “Commitment” shall
mean, with respect to each Bank, the obligation of such Bank to make Loans or to
participate in Letters of Credit in an aggregate principal or face amount at any
one time outstanding up to but not exceeding (a) with respect to each Bank that
is a party to this Agreement as of the date of this Agreement, the amount set
opposite the name of such Bank on  Annex I hereto under the caption
“Amount of Commitment” or (b) in the case of any other Bank, the aggregate
amount of the Commitments of other Banks acquired by it pursuant to Section 12.06(b) of
this Agreement (in each of clause (a) and (b) above, as the same may be
increased or reduced from time to time pursuant to the terms of this
Agreement).  In the case of any increase or decrease in the Borrowing
Base resulting from a redetermination in accordance with Section 1.03(b) or
resulting from adjustments, redeterminations and the principles set forth in
Sections 1.03(c), 1.03(d), 1.03(e), 2.10 and 9.22 hereof, the
Commitment of each Bank shall be increased or decreased pro rata in accordance with
its Commitment Percentage existing at the time of such increase or decrease in
the Borrowing Base.

       

      “Commitment
Percentage” shall mean, at any time, with respect to any Bank, the ratio
of (a) the amount of its Commitment at such time to (b) the aggregate amount of
the Commitments of all the Banks at such time.

       

      “Commitment Period”
shall mean the period from and including the Closing Date to the Commitment
Termination Date.

       

      “Commitment Termination
Date” shall mean the earliest of

       

      (a)           the
Maturity Date;

       

      (b)           the
date on which the Commitments are terminated in full or reduced to zero pursuant
to the terms of this Agreement; and

       

      (c)           the
date on which any Commitment Termination Event occurs.

       

      Upon the
occurrence of any event described above, all of the Commitments shall terminate
automatically and without any further action.

       

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

       

      “Commitment Termination
Event” shall mean any of the following:

       

      (a)           the
occurrence of any Event of Default described in Section ‎10(f) or 10(g);
or

       

      (b)           the
occurrence of any other Event of Default and either (i) all or any portion of
the Loans shall have been declared to be due and payable pursuant to ‎Section 10 or (ii)
the Administrative Agent shall have given notice to the Borrower that the
Commitments have been terminated.

       

      “Commodity Hedging
Agreement” shall mean, for any Person, (a) any swap, forward, cap, floor,
collar or other similar transaction between such Person and one or more
financial institutions or other entities relating to the price of any category
of Hydrocarbons or any index calculated based on the price of one or more
categories of Hydrocarbons, (b) any option with respect to any of the foregoing
transactions, (c) physical forward contracts for set prices, provided that payment
is not made prior to delivery and (d) any combination of the foregoing
transactions.

       

      “Consolidated Current
Assets” shall mean, at any time, the aggregate of the Borrower’s and its
consolidated Subsidiaries’ unrestricted aggregate
cash on hand, marketable securities, other receivables and oil inventory
expected to be sold and the proceeds of such sale expected to be realized within
twelve months but excluding all receivables more than ninety days past due, all
determined without duplication in accordance with GAAP; provided that each of
GTE Colombia, the GP, the Partnership, Solana Petroleum (including the Solana
Colombian Branch) and Solana Resources shall be deemed to be consolidated
Subsidiaries of the Borrower for the purposes of this definition,
notwithstanding the fact that the consolidation rules under GAAP might not
otherwise apply; and provided further that, for
the purposes of determining the ratio of Consolidated Current Assets to
Consolidated Current Liabilities under Section 9.10(c), the
aggregate unused and uncancelled amount of the Commitments (if any) at such time
shall be added to, and constitute part of, the Consolidated Current
Assets.

       

      “Consolidated Current
Liabilities” shall mean, at any time, the aggregate of the Borrower’s and
its consolidated Subsidiaries’ aggregate liabilities falling due within twelve
months (including the portion of long term debt falling due within twelve
months), including amounts payable, taxes, and payments in lieu of taxes and
required dividends, all determined without duplication in accordance with GAAP;
provided that
each of GTE Colombia, the GP, the Partnership, Solana Petroleum (including the
Solana Colombian Branch) and Solana Resources shall be deemed to be consolidated
Subsidiaries of the Borrower for the purposes of this definition,
notwithstanding the fact that the consolidation rules under GAAP might not
otherwise apply.

       

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

       

      “Currency Exchange
Agreement” shall mean, for any Person, an agreement or arrangement
between such Person and one or more financial institutions or other entities
providing for the transfer or mitigation of risks of fluctuations in the
exchange rate between currencies either generally or under specific
contingencies.

       

      “Debt Coverage Ratio”
shall mean, as of the end of each fiscal quarter of the Borrower during the
Commitment Period, the ratio of (a) the aggregate Indebtedness of the Borrower
and its consolidated Subsidiaries then existing, to (b) EBITDA of the Borrower
and its consolidated Subsidiaries determined in each case without duplication in
accordance with GAAP for the immediately preceding four consecutive fiscal
quarters of the Borrower; provided that in the
case of the first, second and third fiscal quarters ending after the Closing
Date, EBITDA for the purposes of this clause (b) shall instead be calculated as
twice the amount of actual EBITDA of the Borrower and its consolidated
Subsidiaries determined in each case without duplication in accordance with GAAP
for the immediately preceding two consecutive fiscal quarters of the Borrower
ending on the first, second or third fiscal quarter after the Closing Date (as
the case may be).  If any acquisition or investment has been made by
the Borrower or any of its Subsidiaries but has not been given effect to in the
calculation of EBITDA, the Majority Banks may, in their absolute discretion,
agree to give pro forma effect to such acquisition or investment in the
calculation of EBITDA by including the value thereof as if such acquisition or
investment had taken place at the start of the immediately preceding two fiscal
quarters, or four fiscal quarters, as the case may be.

       

      “Default” shall mean
an Event of Default or an event that with notice or lapse of time or both would
become an Event of Default; provided that a
Borrowing Base Deficiency shall not of itself be considered a Default during the
applicable Deficiency Cure Period.

       

      “Deficiency Cure
Period” shall have the meaning given to such term in Section
2.10(a).

       

      “Deficiency Notice”
shall have the meaning given to such term in Section 2.10(a)
hereof.

       

      “Designated Hedging
Agreement” shall mean each Hedging Agreement (based on the form of an
ISDA Master Agreement) entered into by the Borrower under which the counterparty
is (or at the time such Hedging Agreement was entered into, was) a Designated
Hedging Counterparty.

       

      “Designated Hedging
Counterparty” shall mean a Bank or an Affiliate of a Bank (or any entity
that was a Bank or an Affiliate of a Bank at the time that it entered into a
Designated Hedging Agreement) that is the counterparty under a Designated
Hedging Agreement.

       

      “Designated Hedging
Obligations” shall mean all amounts, indemnities and reimbursement
obligations, contingent or absolute, of every type or description, and at any
time existing, owed by the Borrower to a Designated Hedging Counterparty
pursuant to the terms of a Designated Hedging Agreement.

       

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

       

      “Determination Date”
shall mean the date which is 25 days after the date that the Reserve Evaluation
Report and/or such other information as is required to be delivered to the
Administrative Agent for the purposes of any redetermination of the Borrowing
Base shall be delivered to the Administrative Agent.

       

      “Determination Period”
shall mean (a) initially, the period commencing on the date of this Agreement
and ending on the first Determination Date thereafter and (b) each period
commencing on a Determination Date and ending on the day immediately preceding
the next succeeding Determination Date.

       

      “Development Costs”
shall mean Capital Expenditures attributable to the interest of the Borrower or
any of its Restricted Subsidiaries in Hydrocarbon Properties required to develop
any of the Hydrocarbon Properties and produce Hydrocarbons therefrom included in
the most recent Reserve Evaluation Report.

       

      “Disposition” shall
mean any sale, assignment, transfer or other disposition of any Property
(whether now owned or hereafter acquired) by the Borrower or any of its
Restricted Subsidiaries to any Person (other than by any such Restricted
Subsidiary to the Borrower or any other Restricted Subsidiary, or by the
Borrower to a Restricted Subsidiary), excluding any sale, assignment, transfer
or other disposition of (a) any Property sold or disposed of in the ordinary
course of business and on ordinary business terms, (b) any Unrestricted
Properties or (c) any stock of an Unrestricted Subsidiary.

       

      “Dividend Payment”
shall mean dividends (in cash, Property or obligations) on, or other payments or
distributions on account of, or the setting apart of money for a sinking or
other analogous fund for, or the purchase, redemption, retirement or other
acquisition of, any shares of any class of stock of the Borrower or any of its
Restricted Subsidiaries or of any warrants, options or other rights to acquire
the same (or to make any payments to any Person, such as “phantom stock”
payments, where the amount thereof is calculated with reference to the fair
market or equity value of the Borrower or any of its Restricted Subsidiaries),
but excluding any stock option plan of the Borrower or any of its Restricted
Subsidiaries, dividends payable solely in shares of common stock of the Borrower
or a Restricted Subsidiary, and any such dividend (other than phantom stock
payments made to employees of a Restricted Subsidiary in connection with the
compensation arrangements for such employees, subject to the restrictions
contained in Section
9.09) that is paid either to the Borrower or another Wholly Owned
Restricted Subsidiary.

       

      “EBITDA” shall mean,
for any period, the revenues of the Borrower and its consolidated Subsidiaries
for such period from continuing operations, minus associated costs (generally
excluding Interest Expense, income taxes, depreciation and amortization and
provision for future site restoration costs, but including actual expenditures
for site restoration), determined in each case without duplication in accordance
with GAAP.

       

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

       

      “EDC” shall mean
Export Development Canada, a Crown corporation of Canada providing financing and
export credit agency services in connection with the export of goods or
services.

       

      “Environmental Claim”
shall mean, with respect to any Person, any written or oral notice, claim,
demand or other communication (collectively, a “claim”) by any other
Person alleging or asserting such Person’s liability for investigatory costs,
cleanup costs, governmental response costs, damages to natural resources or
other Property, personal injuries, fines or penalties arising out of, based on
or resulting from (a) the presence, or Release into the environment, of any
Hazardous Material at any location, whether or not owned by such Person, or (b)
circumstances forming the basis of any violation, or alleged violation, of any
Environmental Law.  The term “Environmental Claim” shall include,
without limitation, any claim by any Governmental Authority for enforcement,
cleanup, removal, response, remedial or other actions or damages pursuant to any
applicable Environmental Law, and any claim by any third party seeking damages,
contribution, indemnification, cost recovery, compensation or injunctive relief
resulting from the presence of Hazardous Materials or arising from alleged
injury or threat of injury to health, safety or the environment.

       

      “Environmental Laws”
shall mean any and all present and future federal, state, municipal, provincial,
local and foreign laws, rules or regulations, and any orders or decrees, in each
case as now or hereafter in effect and having the force of law, relating to the
regulation or protection of human health, safety or the environment or to
emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals or toxic or hazardous substances or wastes into the
indoor or outdoor environment, including, without limitation, ambient air, soil,
surface water, ground water, wetlands, land or subsurface strata, or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of pollutants, contaminants, chemicals or toxic
or hazardous substances or wastes.

       

      “Equity Issuance”
shall mean (a) any issuance or sale by the Borrower or any of its Restricted
Subsidiaries after the date of this Agreement of (i) any of its Capital Stock,
(ii) any warrants or options exercisable in respect of its Capital Stock or
(iii) any other security or instrument representing an equity interest (or the
right to obtain any equity interest) in the Borrower or any of its Restricted
Subsidiaries or (b) the receipt by the Borrower or any of its Restricted
Subsidiaries after the date of this Agreement of any capital contribution
(whether or not evidenced by any equity security issued by the recipient of such
contribution); provided that Equity
Issuance shall not include (x) any such issuance or sale by any Restricted
Subsidiary of the Borrower to the Borrower or any other Wholly Owned Subsidiary
of the Borrower which is a Restricted Subsidiary, (y) any such issuance or sale
in connection with any capital contribution by the Borrower or any Restricted
Subsidiary to any other Restricted Subsidiary of the Borrower or (z) any
warrants or options issued to directors, officers or employees of the Borrower
and its Restricted Subsidiaries pursuant to any employee benefit plans,
incentive plans or similar programs established in the ordinary course of
business.

       

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

       

      “Equity Rights” shall
mean, with respect to any Person, any outstanding subscriptions, options,
warrants, commitments, preemptive rights or agreements of any kind (including,
without limitation, any stockholders’ or voting trust agreements) for the
issuance, sale, registration or voting of, or securities convertible into, any
additional shares of Capital Stock of any class, or partnership or other
ownership interests of any type in, such Person.

       

      “Eurodollar Loan”
shall mean a Loan, the rate of interest applicable to which is based upon the
Eurodollar Rate.

       

      “Eurodollar Rate”
shall mean, for any Interest Period, (a) the rate per annum (rounded to the
nearest 1/100 of 1%) equal to the rate determined by the Administrative Agent to
be the offered rate which appears on the Reuters page which displays an average
British Bankers Association Interest Settlement Rate (such page currently being
page LIBOR01) for deposits with a term equivalent to such Interest Period in US
Dollars (for delivery on the first day of such Interest Period), determined as
of approximately 11:00 a.m. (London, England time) on the date three Business
Days prior to the first day of such Interest Period, or (b) in the event the
rate referenced in the preceding clause (a) does not appear on such page or
service or if such page or service shall cease to be available, the rate per
annum (rounded to the nearest 1/100 of 1%) equal to the rate determined by the
Administrative Agent to be the offered rate on such other page or other service
which displays an average British Bankers Association Interest Settlement Rate
for deposits (for delivery on the first day of such period) with a term
equivalent to such Interest Period in US Dollars, determined as of approximately
11:00 a.m. (London, England time) on the date three Business Days prior to the
first day of such Interest Period, or (c) in the event the rates referenced in
the preceding clauses (a) and (b) are not available, the rate per annum (rounded
to the nearest 1/100 of 1%) equal to the offered quotation rate to first class
banks in the London interbank market by the Administrative Agent for deposits
(for delivery on the first day of the relevant Interest Period) in US Dollars of
amounts in same day funds comparable to the principal amount of the applicable
Loan of the Administrative Agent, in its capacity as a Bank, for which the
Eurodollar Rate is then being determined with maturities comparable to such
period as of approximately 11:00 a.m. (London, England time) on the date three
(3) Business Days prior to the first day of such Interest Period.

       

      “Event of Default”
shall have the meaning given to such term in Section 10
hereof.

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      “Excluded Taxes” shall
mean, with respect to the Administrative Agent, any Bank, the Issuing Bank or
any other recipient of any payment to be made by or on account of any obligation
of any Obligor under any Loan Document, (a) taxes imposed on or measured by its
overall net income (however denominated), and franchise taxes imposed on it (in
lieu of net income taxes), by the jurisdiction (or any political subdivision
thereof) under the laws of which such recipient is organized or in which its
principal office is located or, in the case of any Bank, in which its Applicable
Lending Office is located, (b) any branch profits taxes imposed by the United
States of America or any similar tax imposed by the jurisdiction (or any
political subdivision thereof) under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Bank, in which its Applicable Lending Office is located, and (c) in the case of
(i) a Foreign Lender, other than a Foreign Lender that is a party to this
Agreement on the date hereof (each an “Original Bank”), or
(ii) any Person which becomes a Bank hereunder and is assigned a Commitment
which was obtained by way of assignment directly from an Original Bank or
indirectly from an Original Bank through one or more prior assignments, any
withholding tax that is imposed on any amount payable or accruing to such
Foreign Lender at and from the time such Foreign Lender becomes a party to this
Agreement (or designates a new Applicable Lending Office) except to the extent
that such Foreign Lender (or the Original Bank, if applicable) was entitled, at
the time of the designation of a new Applicable Lending Office (or at the time
of the assignment of the relevant Commitment, if applicable), to receive
additional amounts from the Borrower or any other Obligor with respect to such
withholding tax pursuant to Section
5.

       

      “Fee Letter” shall
mean the letter agreement dated as of the Original Closing Date, between the
Borrower and the Administrative Agent.

       

      “Foreign Assets” shall
have the meaning set forth in Section
1.03(b).

       

      “Foreign Lender” shall
mean any Bank that is organized under the laws of a jurisdiction other than that
in which any Obligor is located.

       

      “GAAP” shall mean
generally accepted accounting principles in the United States of America set
forth in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or such other
principles as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the circumstances as of
the date of determination, applied on a basis consistent with those which, in
accordance with the last sentence of Section 1.02(a)
hereof, are to be used in making the calculations for purposes of determining
compliance with this Agreement.

       

      “GP Pledge Agreement”
shall mean a pledge agreement governed by the laws of the State of New York,
dated as of January 1, 2009 (as the same may be amended, restated, substituted
or supplemented from time to time), in form and substance satisfactory to the
Administrative Agent, granting in favor of the Administrative Agent for the
ratable benefit of the Secured Parties a first-priority security interest in all
of the Capital Stock in the GP.

       

      
        
           

        

        
          11

          
            

          

        

        
           

        

      

      “Governmental
Authority” shall mean any federal, state, municipal, provincial, local,
territorial, or other governmental subdivision, department, commission, board,
bureau, agency, regulatory authority, instrumentality, judicial or
administrative body, domestic or foreign, having jurisdiction where the Borrower
or any Subsidiary conducts any business or has Property and the actions of which
could reasonably be expected to result in a Material Adverse
Effect.

       

      “GP” shall have the
meaning given to such term in the preamble hereof.

       

      “GTE Collection
Account” shall mean account number 103353265 in the name of the
Partnership, maintained with JPMorgan Chase Bank, N.A. in New York, New York,
and each other deposit account that may be maintained by the Partnership (or any
other Obligor) from time to time in substitution thereof with the Administrative
Agent’s prior written consent.

       

      “GTE Collection Account
Pledge Agreement” shall mean an account pledge agreement governed by the
laws of the State of New York, dated as of the Original Closing Date (as the
same may be amended, restated, substituted or supplemented from time to time),
in form and substance satisfactory to the Administrative Agent, granting in
favor of the Administrative Agent for the ratable benefit of the Secured Parties
a first-priority security interest in the GTE Collection Account and all amounts
standing to the credit thereof from time to time.

       

      “GTE Colombian Branch”
shall mean Gran Tierra Energy Colombia, Ltd., the Colombian branch office of the
Partnership.

       

      “GTE Colombia” shall
mean  “series 1”, “series 2” and “series 3” in the limited liability
company agreement of GTE Colombia Holdings LLC, a Delaware limited liability
company; provided that, for
the avoidance of doubt, as used in any provision of this Agreement that relates
to the assets, liabilities, rights or obligations of GTE Colombia Holdings LLC
(including the definition of “Consolidated Current
Assets” and “Consolidated Current
Liabilities”), “GTE Colombia” shall
mean only the assets, liabilities, rights and obligations associated with the
limited liability company series interests described as “series 1”, “series 2”
and “series 3” in the limited liability company agreement of GTE Colombia
Holdings LLC on the date hereof, and any provision of this Agreement that
relates to the classification of GTE Colombia Holdings LLC or “GTE Colombia” as a
Subsidiary of the Borrower shall mean “series 1”, “series 2” and “series 3” of
GTE Colombia Holdings LLC, each acting separately and independently pursuant to
Section 18-215 of the Delaware Limited Liability Company Act (and any limited
liability company series interests designated in substitution thereof or
replacement therefor) and such other limited liability company series interests
of GTE Colombia Holdings LLC established from time to time that may be held by
the Borrower.

       

      
        
           

        

        
          12

          
            

          

        

        
           

        

      

      “Guarantee” shall mean
a guarantee, an endorsement, a contingent agreement to purchase or to furnish
funds for the payment or maintenance of, or otherwise to be or become
contingently liable under or with respect to, the Indebtedness, other
obligations, net worth, working capital or earnings of any Person or any
production or revenues generated by (or any capital or other expenditures
incurred in connection with the acquisition and exploitation of, exploration
for, development of or production from) any Hydrocarbon reserves, or a guarantee
of the payment of dividends or other distributions upon the stock or equity
interests of any Person, or an agreement to purchase, sell or lease (as lessee
or lessor) Property, products, materials, supplies or services primarily for the
purpose of enabling a debtor to make payment of such debtor’s obligations or an
agreement to assure a creditor against loss, and including, without limitation,
causing a bank, surety company or other financial institution or similar entity
to issue a letter of credit, surety bond or other similar instrument for the
benefit of another Person, but excluding endorsements for collection or deposit
in the ordinary course of business.  The terms “Guarantee” and “Guaranteed” used as a
verb shall have a correlative meaning.

       

      “Guaranteed
Obligations” shall have the meaning given to such term in Section 6.01
hereof.

       

      “Guarantors” shall
have the meaning given to such term in Section 6.01
hereof.

       

      “Hazardous Material”
shall mean, collectively, (a) any petroleum or petroleum products, flammable
explosives, radioactive materials, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation, and transformers or other equipment
that contain dielectric fluid containing polychlorinated biphenyls (PCB’s), (b)
any chemicals or other materials or substances which are now or hereafter become
defined as or included in the definition of “hazardous substances”, “hazardous
wastes”, “hazardous materials”, “extremely hazardous wastes”, “restricted
hazardous wastes”, “toxic substances”, “toxic pollutants”, “contaminants”,
“pollutants” or words of similar import under any Environmental Law and (c) any
other chemical or other material or substance, exposure to which is now or
hereafter prohibited, limited or regulated under any Environmental
Law.

       

      “Hedging Agreement”
means any Commodity Hedging Agreement, Currency Exchange Agreement or Interest
Rate Protection Agreement.

       

      “Hydrocarbons” shall
mean oil, gas, casinghead gas, drip gasoline, natural gasoline, condensate,
distillate, liquid hydrocarbons, gaseous hydrocarbons and all products refined
or separated therefrom.

       

      “Hydrocarbon
Properties” shall mean interests which the Borrower and any of its
Restricted Subsidiaries may have from time to time in Hydrocarbon reserves from
which Hydrocarbons may or may potentially be severed or extracted in
commercially feasible quantities.

       

      
        
           

        

        
          13

          
            

          

        

        
           

        

      

      “Indebtedness” shall
mean, for any Person and without duplication:  (a) obligations
created, issued or incurred by such Person for borrowed money (whether by loan,
the issuance and sale of debt securities or the sale of Property to another
Person subject to an understanding or agreement, contingent or otherwise, to
purchase or repurchase the same or similar Property from such Person); (b)
obligations of such Person to pay the deferred purchase or acquisition price of
Property or services, other than trade accounts payable (other than for borrowed
money) arising, and accrued expenses incurred, in the ordinary course of
business so long as such trade accounts payable are payable within 90 days (or,
in the case of  trade accounts payable arising pursuant to the terms
of each of the Expense Reimbursement Agreements, dated as of May 28, 2009, made
by and among each of the limited liability company series interests described as
“series 1”, “series 2”, “series 3”, “series 4”, “series 5”, “series 6”, “series
7”, “series 8” and “series 9” in the limited liability company agreement of GTE
Colombia Holdings LLC, a Delaware series limited liability company and the
Partnership, 140 days) of the date the respective goods are delivered or the
respective services are rendered; (c) obligations of others secured by a Lien on
the Property of such Person, whether or not the respective obligations so
secured has been assumed by such Person, provided that (i) the
amount to be included as “Indebtedness” shall be the amount reasonably estimated
by the Borrower and indicated on each certificate delivered pursuant to Section 9.01(a) and
(ii) if no such estimate is provided, the amount included as Indebtedness shall
be the entire amount of such obligations; (d) obligations of such Person in
respect of letters of credit, surety bonds or similar instruments issued or
accepted by banks, surety companies and other financial institutions for the
account of such Person; (e) Capital Lease Obligations of such Person; (f)
obligations of such Person in respect of obligations of the types specified in
other clauses of this definition as a general partner or joint venturer of any
partnership or joint venture (other than in respect of obligations incurred in
the ordinary course of business); (g) the unearned balance of any advance
payment received by such Person under any contract to be performed in excess of
$1,000,000 (or its equivalent amount in another currency) in the aggregate
resulting from transactions in the ordinary course of such Person’s business;
(h) obligations of such Person under any Hedging Agreement or other derivative
contract, valued as at any date of determination at an amount equal to: (i) if
documented pursuant to the Master Agreement (Multicurrency-Cross Border)
published by the International Swap and Derivatives Association, Inc. (the
“Master
Agreement”), the amount, if any, that would be payable by any Obligor to
its counterparty under such Hedging Agreement or derivative contract, as if (A)
such Hedging Agreement or derivative contract was being terminated early on such
date of determination and (B) such Obligor was the sole “Affected Party” (as
defined in the Master Agreement); (ii) in the case of a Hedging Agreement or
derivative contract traded on an exchange, its mark-to-market value, which will
be the unrealized loss on such Hedging Agreement or derivative contract to the
Obligor party to the same based on the settlement price of such Hedging
Agreement or derivative contract on such date of determination; or (iii) in all
other cases, the mark-to-market value of such Hedging Agreement or derivative
contract, which will be the unrealized loss on such Hedging Agreement or
derivative contract to the Obligor party to the same determined as the amount,
if any, by which (A) the present value of the future cash flows to be paid by
such Obligor exceeds (B) the present value of the future cash flows to be
received by such Obligor pursuant to such Hedging Agreement or derivative
contract; and (i) Indebtedness of others Guaranteed by such Person.

       

      
        
           

        

        
          14

          
            

          

        

        
           

        

      

    “Indemnified Taxes”
shall mean Taxes other than Excluded Taxes.

     

    “Independent Petroleum
Engineer” shall mean (a) GLJ Petroleum Consultants or (b) such other firm
of independent petroleum engineers expert in the matters required to be
performed in connection with the preparation and delivery of a Reserve
Evaluation Report and proposed by the Borrower from time to time and reasonably
satisfactory to the Administrative Agent and the Majority Banks.

     

    “Insurance Date” shall
have the meaning given to that term in Section
2.10(b).

     

    “Interest Expense”
shall mean, for any period, interest expense for the Borrower and its
consolidated Subsidiaries for such period (determined in each case without
duplication in accordance with GAAP) including, without limitation, the
following:  all interest in respect of Indebtedness accrued or
capitalized during such period (whether or not actually paid during such period)
(other than interest paid in common stock of the Borrower) and the net amounts
payable (or minus the net amounts receivable) under Interest Rate Protection
Agreements of such Persons accrued during such period (whether or not actually
paid or received during such period).  References in this definition
(whether in the singular or the plural) to consolidated Subsidiaries shall, for
purposes of calculating Interest Expense for a period or part of a period ending
prior to the date of this Agreement, be deemed to refer to corporations or other
entities that would have been consolidated Subsidiaries had this Agreement been
in effect on the first day of such period.

     

    “Interest Period”
shall mean, with respect to any Loan, each period commencing on the date such
Loan is made or the last day of the next preceding Interest Period for such Loan
and ending on the numerically corresponding day in the first, second or third calendar month
thereafter, as the Borrower may select as provided in Section 4.05 hereof,
except that each Interest Period that commences on the last Business Day of a
calendar month (or on any day for which there is no numerically corresponding
day in the appropriate subsequent calendar month) shall end on the last Business
Day of the appropriate subsequent calendar month.  Notwithstanding the
foregoing, if any Interest Period in respect of a Loan would otherwise end after
the applicable Commitment Termination Date, such Interest Period shall end on
the Commitment Termination Date.

     

    “Interest Rate Protection
Agreement” shall mean, for any Person, an interest rate swap, cap or
collar agreement or similar arrangement between such Person and one or more
financial institutions or other entities providing for the transfer or
mitigation of interest risks, either generally or under specific
contingencies.

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

    “Investment” shall
mean, for any Person:  (a) the acquisition (whether for cash,
Property, services or securities or otherwise) of capital stock, bonds, notes,
debentures, partnership or other ownership interests or other securities of any
other Person or any agreement to make any such acquisition (including, without
limitation, any “short sale” or any sale of any securities at a time when such
securities are not owned by the Person entering into such short sale); (b) the
making of any deposit with, or advance, loan or other extension of credit to,
any other Person (including the purchase of Property from another Person subject
to an understanding or agreement, contingent or otherwise, to resell such
Property to such Person, but excluding any such deposit, advance, loan or
extension of credit having a term not exceeding 90 days representing the
purchase price of inventory or supplies sold by such Person in the ordinary
course of business); (c) the entering into of any Guarantee of, or other
contingent obligation with respect to, Indebtedness or other liability of any
other Person and (without duplication) any amount committed to be advanced, lent
or extended to such Person (excluding any performance or similar guarantee not
otherwise constituting Indebtedness and customarily granted in connection with
the exploration and development of Hydrocarbon Properties); or (d) the entering
into of any Interest Rate Protection Agreement or Commodity Hedging
Agreement.  The definition of “Investment” shall not
include any expenditure incurred in acquiring interests in joint ventures, unit
interests, royalty interests, working interests and similar interests in each
case, relating to Hydrocarbon Properties and plants, facilities, pipelines and
equipment reasonably related thereto.

     

    “Issuing Bank” shall
mean Standard Bank Plc as the issuer of Letters of Credit under Section 2.03(b)
hereof, together with its successors and assigns in such capacity.

     

    “Letter of Credit”
shall have the meaning given to such term in Section 2.03(a)
hereof.

     

    “Letter of Credit
Documents” shall mean, with respect to any Letter of Credit,
collectively, any application therefor and any other agreements, instruments,
guarantees or other documents (whether general in application or applicable only
to such Letter of Credit) governing or providing for (a) the rights and
obligations of the parties concerned or at risk with respect to such Letter of
Credit or (b) any collateral security for any of such obligations, each as the
same may be modified and supplemented and in effect from time to
time.

     

    “Letter of Credit
Interest” in connection with any Letter of Credit, shall mean, for each
Bank and the Issuing Bank, each such Bank’s participation interest (or, in the
case of the Issuing Bank, the Issuing Bank’s retained interest, if any, after
giving effect to the participation interest of each such Bank) in the Issuing
Bank’s liability under Letters of Credit and each such Bank’s rights and
interests in Reimbursement Obligations and fees, interest and other amounts
payable in connection with Letters of Credit and Reimbursement
Obligations.

     

    “Letter of Credit
Liability” shall mean, without duplication, at any time and in respect of
any Letter of Credit, (a) the sum of (i) the undrawn and uncancelled face amount
of such Letter of Credit plus (ii) the aggregate unpaid principal amount of all
Reimbursement Obligations of the Borrower at such time due and payable in
respect of all drawings made under such Letter of Credit, minus (b) the sum of
(i) any amount provided by the Borrower as cash collateral in respect of such
Letter of Credit, and (ii) the amount of any Letter of Credit unconditionally
guaranteed by EDC on terms in form and substance acceptable to the Majority
Banks.  For purposes of this Agreement, a Bank (other than the Issuing
Bank) shall be deemed to hold a Letter of Credit Liability in an amount equal to
its participation interest in the related Letter of Credit under Section 2.03
hereof.

    
      
         

      

      
        16

        
          

        

      

      
         

      

    

    “Lien” shall mean,
with respect to any Property, any mortgage, lien, pledge, charge, security
interest or encumbrance of any kind in respect of such Property, but does not
include a right of set-off created in the ordinary course of business unless
such right of set-off is created for the purposes of securing obligations
created, issued or incurred for borrowed money.  For purposes of this
Agreement and the other Loan Documents, a Person shall be deemed to own subject
to a Lien any Property that it has acquired or holds subject to the interest of
a vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement (other than an operating lease) relating to such
Property.

     

    “Loan” shall have the
meaning given to such term in Section 2.01(a)
hereof.

     

    “Loan Documents” shall
mean this Agreement, the Notes, the Letter of Credit Documents, the Designated
Hedge Agreements, the Security Documents, the Fee Letter and the Step-Up
Agreement and all other agreements, documents, and instruments entered into in
connection with any amendment, waiver, supplement or other modification with
respect to any of the foregoing; provided that, for
purposes of the definition of “Material Adverse
Effect” and Sections 4, 5, 7, 8 and 9, “Loan Documents” shall
not include any Designated Hedge Agreement.

     

    “Majority Banks” shall
mean, at any time, Banks having greater than 51% of the aggregate amount of the
Commitments at such time, or if the Commitments shall have been terminated,
Banks holding greater than 51% of the sum of the aggregate unpaid principal
amount of the Loans and the Letter of Credit Liabilities at such
time.

     

    “Mandatory Costs”
shall mean the percentage rate per annum calculated by the Administrative Agent
in accordance with Annex II hereto.

     

    “Material Adverse
Effect” shall mean a material adverse effect on (a) the Property,
business, operations, condition (financial or otherwise) or liabilities of the
Borrower and its Restricted Subsidiaries taken as a whole, (b) the ability of
the Borrower or any material Restricted Subsidiary to perform its respective
obligations under any of the Loan Documents to which it is a party, (c) the
validity or enforceability of any of the Loan Documents, (d) the right and
remedies of any Bank and the Administrative Agent under any of the Loan
Documents, as the case may be (other than any such material adverse effect
resulting from the failure of the Administrative Agent or any Bank to take
actions to maintain such rights or remedies and other than as those rights and
remedies are subject to the qualifications contained in the legal opinions
delivered pursuant to Section 7.02(b)
hereof), or (e) the timely payment of the principal of or interest on the Loans,
Reimbursement Obligations or other amounts payable in connection
therewith.

    
      
         

      

      
        17

        
          

        

      

      
         

      

    

    “Maturity Date” shall
mean February 22, 2010, as such date may be extended by written agreement in
accordance with Section 12.04
hereof.

     

    “Net Available
Proceeds” shall mean:

     

    (a)           in
the case of any Disposition by the Borrower or a Restricted Subsidiary, the
amount of Net Cash Payments received in connection with such Disposition;
and

     

    (b)           in
the case of any Casualty Event with respect to any Property of the Borrower or
any of its Restricted Subsidiaries, the aggregate amount of proceeds of
insurance, condemnation awards and other compensation received by the Borrower
and its Restricted Subsidiaries in respect of such Casualty Event (excluding
proceeds of business interruption insurance) net of (i) reasonable transaction
costs and expenses (including, without limitation, any underwriting, brokerage
or other customary selling commissions, reasonable legal, advisory and other
fees and expenses associated therewith and sales, VAT and transfer taxes arising
therefrom) incurred by the Borrower and its Restricted Subsidiaries in
connection therewith and (ii) contractually required repayments of Indebtedness
to the extent secured by a Lien on such Property and any income and transfer
taxes payable by the Borrower or any of its Restricted Subsidiaries in respect
of such Casualty Event.

     

    “Net Cash Payments”
shall mean, with respect to any Disposition, the aggregate amount of all cash
payments, and the fair market value of any non-cash consideration, received by
the Borrower and its Restricted Subsidiaries directly or indirectly in
connection with such Disposition; provided that (a) Net
Cash Payments shall be net of (i) the amount of any legal, title and recording
tax expenses, commissions and other fees and expenses (including, without
limitation, any underwriting, brokerage or other customary selling commissions,
reasonable legal, advisory and other fees and expenses associated therewith and
sales, VAT and transfer taxes arising therefrom) paid by the Borrower and its
Restricted Subsidiaries in connection with such Disposition and (ii) any
foreign, federal, state, provincial and local income or other taxes estimated to
be payable by the Borrower and its Restricted Subsidiaries as a result of such
Disposition (but only to the extent that (x) such estimated taxes are in fact
paid to the relevant Governmental Authority within three months of date of such
Disposition or placed in escrow for the payment of such taxes or (y) the amount
of such estimated taxes is less than $750,000 (or its equivalent in another
currency converted at the applicable exchange rate as of the date of such
Disposition) and the payment of such taxes is being contested in good faith and
by appropriate proceedings), (b) Net Cash Payments shall not include any cash
payment (or portion thereof) received in any fiscal year of the Borrower in
respect of such Disposition to the extent that such cash payment (or portion
thereof), together with all cash payments with respect to other Dispositions
therefore received in such fiscal year, does not exceed $500,000 (or its
equivalent in another currency converted at the applicable exchange rate as of
the date of such Disposition) and (c) Net Cash Payments shall be net of any
repayments by the Borrower or any of its Restricted Subsidiaries of Indebtedness
to the extent that (i) such Indebtedness is secured by a Lien on the Property
that is the subject of such Disposition and (ii) such Indebtedness is to be
repaid as a condition to or requirement of the Disposition of such
Property.

    
      
         

      

      
        18

        
          

        

      

      
         

      

    

    “New Wholly Owned
Subsidiary” shall have the meaning given to such term in Section 9.08
hereof.

     

    “Notes” shall mean the
promissory notes provided for by Section 2.08(a)
hereof, executed on the date of this Agreement, and any promissory notes
delivered in substitution or exchange therefor, in each case as the same may be
modified and supplemented and in effect from time to time.

     

    “Obligor” shall have
the meaning given to such term in the preamble hereof.

     

    “Offtaker” shall mean
(a) each of the Persons listed on Schedule I hereof, (b) in the case of
Hydrocarbon Properties operated by the Borrower or any of its Restricted
Subsidiaries, any specific buyer required by applicable law or, in the event
only limited commercially reasonable alternatives exist, any buyer not
specifically excluded by the Majority Banks, (c) in the case of Hydrocarbon
Properties not operated by the Borrower or any of its Restricted Subsidiaries,
any buyer approved by the operator thereof, and (d) any additional Persons that
have been approved in writing by the Majority Banks, acting reasonably, at the
time of the purchase of crude oil or other Hydrocarbons by such Person from the
Borrower or any of its Restricted Subsidiaries; provided that any
such Person shall cease to be an Offtaker if:

     

    (i)           the
Borrower has received any written notice or otherwise has knowledge that such
Person is the subject of any bankruptcy, insolvency, reorganization,
liquidation, dissolution or winding-up proceeding or action (whether voluntary
or involuntary), or

     

    (ii)           at
the time any such determination is made, more than 10% of the aggregate amount
of accounts due from such Person in respect of its purchase of crude oil or
other Hydrocarbons from the Borrower has at such time remained unpaid for more
than 45 days (measured from the due date specified in the original invoice
therefor).

     

    Schedule
I includes, among other entities, all the Persons to whom the Borrower and any
of its Restricted Subsidiaries currently sells crude oil and other Hydrocarbon
products.

     

    “Offtake Agreements”
shall mean, collectively, (a) each agreement entered into between the Borrower
or any of its Restricted Subsidiaries and an Offtaker as listed on Schedule VI
hereto, and (b) any other purchase agreements entered into between the Borrower
or any of its Restricted Subsidiaries and an Offtaker that provide for the
purchase by such Offtaker of Hydrocarbons from the Borrower or any of its
Restricted Subsidiaries, that are in form and substance reasonably satisfactory
to the Administrative Agent and that further provide, to the Administrative
Agent’s reasonable satisfaction, that substantially all payments thereunder
shall be made to the relevant Collection Account, as each such agreement may be
amended, restated, supplemented, replaced or otherwise modified in accordance
with this Agreement.

    
      
         

      

      
        19

        
          

        

      

      
         

      

    

    “Original Borrower”
shall have the meaning given to such term in the recitals hereof.

     

    “Original Closing
Date” shall mean February 22, 2007.

     

    “Original Guarantor”
shall have the meaning given to such term in the preamble hereof.

     

    “Other Taxes” shall
mean any and all present or future stamp or documentary taxes or any other
excise or property taxes, charges or similar levies arising from any payment
made hereunder to the Administrative Agent, any Bank or the Issuing Bank or from
the execution, delivery or enforcement of, or otherwise with respect to, this
Agreement, but in all events not including any Excluded Taxes.

     

    “Parent” means Gran
Tierra Energy Inc., a corporation organized under the laws of the State of
Nevada.

     

    “Partnership” shall
have the meaning given to such term in the preamble hereof.

     

    “Partnership Pledge
Agreement” shall mean a pledge agreement governed by the laws of the
State of New York, dated as of January 1, 2009 (as the same may be amended,
restated, substituted or supplemented from time to time), in form and substance
satisfactory to the Administrative Agent, granting in favor of the
Administrative Agent for the ratable benefit of the Secured Parties a
first-priority security interest in all of the partnership interests in the
Partnership.

     

    “Permitted
Investments” shall mean:  (a) direct obligations of the United
States of America or Canada, or of any agency of either thereof, or obligations
guaranteed as to principal and interest by the United States of America or
Canada, or by any agency of either thereof, in either case maturing not more
than 12 months from the date of acquisition thereof; (b) certificates of deposit
issued or bankers’ acceptances issued by any Bank or any other bank or trust
company organized under the laws of the United States of America or Canada (or
any state or province thereof) and having capital, surplus and undivided profits
of at least $500,000,000 (or equivalent amount in other currencies), maturing
not more than 12 months from the date of acquisition thereof; (c) commercial
paper rated A-1 or better or P-1 or better by Standard & Poor’s Ratings
Group, a division of McGraw-Hill, Inc. or Moody’s Investors Service, Inc.
respectively, maturing not more than 90 days from the date of acquisition
thereof; (d) commercial paper rated A-2 or better (but less than A-1) or P-2 or
better (but less than P-1) by Standard and Poor’s Rating Group or Moody’s
Investors Services, Inc. respectively, maturing not more than 30 days from the
date of acquisition thereof; (e) money market funds which have a rating of “AAA
m” or “AAA mg” by S&P or have otherwise been approved in writing by the
Majority Banks; (f) any other investments approved in writing by the Majority
Banks; (g) fully collateralized repurchase agreements with a term of not more
than 90 days for securities described in subparagraph (a) above and entered into
with a bank or trust company satisfying the criteria set forth in subparagraph
(b) above; (h) any direct obligations of the Colombian government, or any agency
thereof, backed by the full faith and credit of the Colombian government and
issued in Colombian Pesos; and (i) Colombian Credit Instruments, including
overnight Colombian Credit Investments acquired at a discount from face
value.

    
      
         

      

      
        20

        
          

        

      

      
         

      

    

    

      “Permitted Liens”
shall mean those Liens permitted pursuant to Section 9.06
hereof.

       

      “Person” shall mean
any individual, corporation, company, voluntary association, partnership, joint
venture, trust, unincorporated organization or government (or any agency,
instrumentality or political subdivision thereof).

       

      “Post-Default Rate”
shall mean, in respect of any principal of any Loan, any Reimbursement
Obligation or any other amount under this Agreement, any Note or any other Loan
Document that is not paid when due (whether at stated maturity, by acceleration,
by optional or mandatory prepayment or otherwise), a rate per annum during the
period from and including the due date to but excluding the date on which such
amount is paid in full equal to 2% plus the Applicable
Margin plus the
Eurodollar Rate (calculated as if all such outstanding amounts were Loans with
an Interest Period of one month plus Mandatory Costs,
if any).

       

      “Present Value of
Reserves” shall mean, on any date, estimated net cash flow expressed in
US Dollars (after development expenses and production taxes) in respect of
Proved Reserves attributable to Hydrocarbon Properties calculated in accordance
with the provisions of Section
1.03.

       

      “Property” shall mean
any right or interest in or to property of any kind whatsoever, whether real,
personal or mixed and whether tangible or intangible.

       

      “Proved Reserves”
shall mean, on any date of determination, reserves (to the extent of the net
interest of the Borrower and its Restricted Subsidiaries therein) comprised of
quantities of Hydrocarbons that geologic and engineering data demonstrate with
reasonable certainty to be recoverable in the future from known reservoirs under
existing conditions; provided that such
reserves are recoverable from (a) existing wells, whether from completion
intervals currently open and producing to market, or completion intervals
currently open but not currently producing or zones behind casing of existing
wells, or (b) new wells on undrilled acreage.  Proved Reserves on
undrilled acreage shall be limited to those drilling units offsetting productive
units that are reasonably certain to be productive when
drilled.  Other undrilled units may also be credited with Proved
Reserves where continuity of production from existing productive formations can
be demonstrated with reasonable certainty.  For purposes of
determining whether any Hydrocarbon Properties of the Borrower or any of its
Restricted Subsidiaries contain Proved Reserves, the most recent Reserve
Evaluation Report shall be determinative.

      
        
           

        

        
          21

          
            

          

        

        
           

        

      

      “Quarterly Dates”
shall mean the last day of March, June, September and December in each year, the
first of which shall be the first such day after the date of this Agreement;
provided that
if any such day is not a Business Day, then such Quarterly Date shall be the
next succeeding Business Day.

       

      “Regulation A” and
“Regulation D”
shall mean, respectively, Regulations A and D of the Board of Governors of the
Federal Reserve System (or any successor), as the same may be modified and
supplemented and in effect from time to time.

       

      “Regulatory Change”
shall mean, with respect to any Bank, any change after the date of this
Agreement in federal, state, provincial or foreign law or regulations
(including, without limitation, Regulation D) or the adoption or making after
such date of any interpretation, directive or request applying to a class of
banks including such Bank of or under any federal, state, provincial or foreign
law or regulations (whether or not having the force of law and whether or not
failure to comply therewith would be unlawful) by any court or governmental or
monetary authority charged with the interpretation or administration
thereof.

       

      “Reimbursement
Obligations” shall mean, at any time, the obligations of the Borrower
then outstanding, or that may thereafter arise in respect of all Letters of
Credit then outstanding, to reimburse amounts paid by the Issuing Bank in
respect of any drawings under a Letter of Credit.

       

      “Release” shall mean
any release, spill, emission, leaking, pumping, injection, deposit, disposal,
discharge, dispersal, leaching or migration into the indoor or outdoor
environment, including, without limitation, the movement of Hazardous Materials
through ambient air, soil, surface water, ground water, wetlands, land or
subsurface strata.

       

      “Report Delivery Date”
shall mean the date which falls (a) 60 days after each December 31, and (b) 60
days after each June 30.

       

      “Reserve Evaluation
Report” shall mean the report referred to in Section 1.03(a)(i),
and an unsuperseded report, in form and substance reasonably satisfactory to the
Administrative Agent, setting forth, as of each January 1st (in the
case of the Reserve Evaluation Report to be delivered by the Independent
Petroleum Engineer pursuant to Section 1.03(a)(ii))
or July 1st (in the
case of the Reserve Evaluation Report required to be delivered by the Borrower
pursuant to Section
1.03(a)(iii)) (or such other date in the event of an interim
redetermination pursuant to Section 1.03(d)) the
oil and gas reserves attributable to the Borrower’s and its Restricted
Subsidiaries’ interest in the production from Hydrocarbon Properties of the
Borrower and its Restricted Subsidiaries, together with a projection of the rate
of production and future net income, taxes, royalties, operating expenses,
production sharing volumes and Development Costs with respect thereto as of such
date, based upon the economic assumptions consistent with the Administrative
Agent’s requirements at the time and using pricing data that the Banks may
reasonably determine consistent with their current lending practices taking into
account quality and basis and differentials related to the production being
produced from the Borrower’s and its Restricted Subsidiaries’ interest in the
production from Hydrocarbon Properties; provided that, with
respect to the volume of Hydrocarbons subject to a Commodity Hedging Agreement,
the Banks shall take into consideration the prices set forth in such Commodity
Hedging Agreement.

      
        
           

        

        
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      “Reserve Requirement”
shall mean, for any Interest Period, the average maximum rate at which reserves
(including, without limitation, any marginal, supplemental or emergency
reserves) are required to be maintained during such Interest Period under
Regulation D by member banks of the Federal Reserve System in New York City with
deposits exceeding one billion US Dollars against “Eurocurrency liabilities” (as
such term is used in Regulation D).  Without limiting the effect of
the foregoing, the Reserve Requirement shall include any other reserves required
to be maintained by such member banks by reason of any Regulatory Change with
respect to (a) any category of liabilities that includes deposits by reference
to which the applicable rate of interest is to be determined as provided in the
definition of “Eurodollar Rate” in this Section 1.01 or (b)
any category of extensions of credit or other assets that includes loans made
using the Eurodollar Rate as the applicable rate of interest.

       

      “Restricted
Subsidiary” shall mean any Subsidiary of the Borrower other than an
Unrestricted Subsidiary; provided that, for
the avoidance of doubt, each of (a) GTE Colombia, (b) the GP, (c) the
Partnership, (d) Solana Petroleum and (e) Solana Resources shall be deemed to be
Restricted Subsidiaries of the Borrower.

       

      “Security Documents”
shall mean, collectively, the Colombian Security Documents, the Collection
Account Pledge Agreements, the GP Pledge Agreement, the Partnership Pledge
Agreement and each of the security agreements, pledge agreements and other
instruments now or hereafter delivered to the Administrative Agent pursuant to
the foregoing or otherwise granting a Lien on any Property of any Person to
secure the obligations and liabilities of any Obligor under any Loan Document,
and all other filings required by applicable law to be filed with respect to the
security interests created pursuant to each of the foregoing
documents.

       

      “Secured Parties”
shall mean each Bank, each Issuing Bank, the Arranger and the Administrative
Agent and each of their respective successors and permitted assigns from time to
time.

       

      “Solana Collection
Account” shall mean account number 200-615151-001-97-USD in the name of
Solana Petroleum, maintained with BNP Paribas in New York, New York, and each
other deposit account that may be maintained by Solana Petroleum (or any other
Obligor) from time to time in substitution thereof with the Administrative
Agent’s prior written consent.

      
        
           

        

        
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      “Solana Collection Account
Pledge Agreement” shall mean an account pledge agreement governed by the
laws of the State of New York, dated as of the Closing Date (as the same may be
amended, restated, substituted or supplemented from time to time), in form and
substance satisfactory to the Administrative Agent, granting in favor of the
Administrative Agent for the ratable benefit of the Secured Parties a
first-priority security interest in the Solana Collection Account and all
amounts standing to the credit thereof from time to time.

       

      “Solana Colombian
Branch” shall mean Solana Petroleum Exploration (Colombia) Limited
(Sucursal), the Colombian branch office of Solana Petroleum.

       

      “Solana Credit
Agreement” means that certain credit agreement dated as of December 20,
2007 by and among Solana Resources, Solana Petroleum, the lenders party thereto
and BNP Paribas as administrative agent for the lenders establishing a credit
facility in a principal amount of up to $100,000,000 (as amended, restated,
supplemented or otherwise modified from time to time prior to the Closing
Date).

       

      “Solana Petroleum”
shall have the meaning given to such term in the preamble hereof.

       

      “Solana Resources”
shall have the meaning given to such term in the preamble hereof.

       

      “Solana Security
Documents” shall mean:

       

      (a)           a
receivables pledge agreement governed by the laws of Colombia, dated as of the
Closing Date (as the same may be amended, restated, substituted or supplemented
from time to time), in form and substance satisfactory to the Administrative
Agent, granting in favor of the Administrative Agent for the ratable benefit of
the Secured Parties a first-priority security interest in substantially all of
the present and future right, title and interest of the Solana Colombian Branch
to receivables payable from time to time by each Offtaker;

       

      (b)           each
receivables payment instruction letter governed by the laws of Colombia,
instructing the Offtaker named therein to make payments due to the Solana
Colombian Branch under the applicable Offtake Agreement to the relevant
Collection Account; and

       

      (c)           a
commercial establishment pledge agreement (contrato de prenda sobre
establecimiento de comercio) in respect of all of the rights of Solana
Colombian Branch in accordance with the terms of the Colombian Commercial
Code.

       

      “Solvent” means, with
respect to any Obligor, that as of the date of determination, both (a) (i) the
sum of such Obligor’s debt (including contingent liabilities) does not exceed
the present fair saleable value of such Obligor’s present assets; (ii) such
Obligor’s capital is not unreasonably small in relation to its business as
contemplated on the Closing Date; and (iii) such Obligor has not incurred and
does not intent to incur, or believe (nor should it reasonably believe) that it
shall incur, debts beyond its ability to pay such debts as they become due
(whether at maturity or otherwise); and (b) such Obligor is “solvent” within the
meaning given that term and similar terms under applicable laws relating to
fraudulent transfers and conveyances.  For purposes of this
definition, the amount of any contingent liability at any time shall be computed
as the amount that, in light of all of the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability.

      
        
           

        

        
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      “Step-Up Agreement”
means the letter agreement dated as of the date hereof, between the Borrower,
the Arranger and the Administrative Agent relating to any increase of the
Commitments above $7,000,000 and the syndication of such
Commitments.

       

      “Step-Up Date” has the
meaning given to such term in the Step-Up Agreement.

       

      “Subsidiary” shall
mean, for any Person, any corporation, partnership or other entity of which at
least a majority of the Voting Stock is at the time directly or indirectly owned
or controlled by such Person or one or more Subsidiaries of such Person or by
such Person and one or more Subsidiaries of such Person; provided that, in the
case of the Borrower, each of (a) GTE Colombia, (b) the GP, (c) the Partnership,
(d) Solana Petroleum and (e) Solana Resources shall be deemed to be Subsidiaries
of the Borrower, regardless of whether or not all of the equity interests in
each of the foregoing entities are held by the Borrower.

       

      “Subsidiary Guarantor”
shall have the meaning given to such term in the preamble hereof.

       

      “Tangible Net Worth”
shall mean, as at any date for any Person, the sum for such Person (determined
on a consolidated basis without duplication in accordance with GAAP as of the
date of its most recent financial statement) of the following, expressed in US
Dollars:

       

      (a)           the
amount of Capital Stock, plus

       

      (b)           the
amount of surplus and retained earnings (or, in the case of a surplus or
retained earnings deficit, minus the amount of
such deficit), minus

       

      (c)           the
sum of the following:  cost of treasury shares and the book value of
all assets which should be classified as intangibles (without duplication of
deductions in respect of items already deducted in arriving at surplus and
retained earnings) but in any event including goodwill, minority interests
(other than minority interests in the production from Hydrocarbon Properties),
research and development costs, trademarks, trade names, copyrights, patents and
franchises, unamortized debt discount and expense, all accounting reserves,
plus

       

      (d)           the
amount of noncash writedowns of long-lived assets in compliance with
GAAP;

      
        
           

        

        
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      plus any increase
occurring during the period from the date of the Borrower’s most recent
financial statements to the date of determination as a result of any Equity
Issuance by the Borrower.

       

      “Taxes” shall mean all
taxes, levies, imposts, stamp taxes, duties, charges to tax, fees, deductions,
withholdings, royalties, charges, compulsory loans or restrictions or conditions
resulting in a charge which are imposed, levied, collected, withheld or assessed
by any political subdivision or taxing authority as of the date of this
Agreement or at any time in the future together with interest thereon and
penalties with respect thereto, if any, and any payments of principal, interest,
charges, fees or other amounts made on or in respect thereof, including without
limitation production and severance taxes and windfall profit taxes, and “Tax” and “Taxation” shall be
construed accordingly; provided that “Taxes” shall exclude
taxes imposed on or measured by the overall net income or capital of a
Person.

       

      “Unrestricted
Properties” shall mean, at any time of determination, the Properties of
the Borrower and its Subsidiaries that (a) are not Hydrocarbon Properties or (b)
have not been given any value in the Borrowing Base as most recently determined
prior to such time of determination.

       

      “Unrestricted
Subsidiary” shall mean on the date of this Agreement, each Person as set
forth on Schedule VII hereto, and thereafter, each Subsidiary of the Borrower
(other than a Subsidiary Guarantor) as may be hereafter designated by the
Borrower as an “Unrestricted
Subsidiary” as provided in Section 1.04
hereof.

       

      “US Dollars” and
“$” shall mean
the lawful currency of the United States of America.

       

      “Voting Stock” shall
mean, with respect to any Person, securities of any class or classes of Capital
Stock in such Person entitling the holders thereof (whether at all times or only
so long as no senior class of stock has voting power by reason of any
contingency) to vote in the election of members of the Board of Directors or
other governing body of such Person.

       

      “Wholly Owned
Subsidiary” shall mean, with respect to any Person, any corporation,
partnership or other entity of which all of the equity securities or other
ownership interests (other than, in the case of a corporation, directors’
qualifying shares) are directly or indirectly owned or controlled by such Person
or one or more Wholly Owned Subsidiaries of such Person or by such Person and
one or more Wholly Owned Subsidiaries of such Person.

      
        
           

        

        
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      1.02  Accounting Terms and
Determinations.

       

      (a)           Except
as otherwise expressly provided herein, all accounting terms used herein shall
be interpreted, and all financial statements and certificates and reports as to
financial matters required to be delivered to the Banks hereunder shall (unless
otherwise disclosed to the Banks in writing at the time of delivery thereof in
the manner described in subsection (b) below) be prepared, in accordance with
GAAP applied on a basis consistent with those used in the preparation of the
audited consolidated financial statements of the Parent as of December 31,
2008.  All calculations made for the purposes of determining
compliance with this Agreement shall (except as otherwise expressly provided
herein) be made by application of GAAP applied on a basis consistent with those
used in the preparation of the latest annual or quarterly financial statements
furnished to the Banks pursuant to Section 9.01 hereof
(or, prior to the delivery of the first financial statements under Section 9.01 hereof,
used in the preparation of the unaudited consolidated financial statements of
the Parent for the three months ended March 31, 2009) unless (i) the Borrower
objects to the Banks in writing to determining such compliance on such basis at
the time of delivery of such financial statements to the Administrative Agent or
(ii) the Majority Banks shall object to the Borrower (through the Administrative
Agent) in writing to so determining such compliance within 30 days after such
delivery of such financial statements, in either of which events such
calculations shall be made on a basis consistent with those used in the
preparation of the latest financial statements as to which such objection shall
not have been made (which, if objection is made in respect of the first
financial statements delivered under Section 9.01 hereof,
shall mean the financial statements referred to in Section 8.02
hereof).

       

      (b)           At
the request of the Majority Banks, through the Administrative Agent, the
Borrower shall deliver to the Administrative Agent (i) a description in
reasonable detail of any material variation between the application of
accounting principles employed in the preparation of such statement and the
application of accounting principles employed in the preparation of the next
preceding annual or quarterly financial statements as to which no objection has
been made in accordance with the last sentence of subsection (a) above and (ii)
reasonable estimates of the difference between such statements arising as a
consequence thereof.

       

      (c)           The
Borrower shall not, and shall not permit any Restricted Subsidiary to, without
the prior written consent of the Administrative Agent, change the last day of
its fiscal year from December 31 of each year, or the last days of the first
three fiscal quarters in each of its fiscal years from March 31, June 30 and
September 30 of each year, respectively.

       

      1.03  Borrowing
Base.

       

      (a)           Reserve Evaluation
Reports.

       

      (i)           The
Borrower has furnished to the Administrative Agent and the Banks on the date of
this Agreement a Reserve Evaluation Report prepared by the Independent Petroleum
Engineer as of June 30, 2006 in respect of the Colombian Hydrocarbon
Properties.

       

      (ii)           On
or before the Report Delivery Date falling 60 days after each December 31, the
Borrower shall furnish to the Administrative Agent, for delivery to the Banks,
an updated Reserve Evaluation Report prepared by the Independent Petroleum
Engineer.

       

      
        
           

        

        
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      (iii)           On
or before the Report Delivery Date falling 60 days after each June 30, the
Borrower shall furnish to the Administrative Agent, for delivery to the Banks,
an updated Reserve Evaluation Report prepared by the Borrower.

       

      (b)           Borrowing
Base.

       

      (i)           During
the period commencing on the date of this Agreement and ending on such date as
the first redetermination of the Borrowing Base shall become effective as
provided below in this Section 1.03(b), the
Borrowing Base shall be $7,000,000 (subject in each case to any adjustments and
redeterminations provided for by Sections 1.03(c),
1.03(d), 1.03(e), 2.10 and 9.22 hereof) which
amount has been determined on the basis of the Reserve Evaluation Report
referred to in Section
1.03(a)(i) (with such adjustments to the rates, factors, values,
estimates, assumptions and computations set forth in such Reserve Evaluation
Report as were acceptable to the Banks party to this Agreement as of the date of
this Agreement).

       

      (ii)           As
promptly as reasonably practicable after its receipt of the Reserve Evaluation
Report furnished to it pursuant to Section 1.03(a)(ii)
or Section
1.03(a)(iii) (as the case may be), the Administrative Agent (in
consultation with the Majority Banks) shall endeavor to redetermine the
Borrowing Base on the basis of such Reserve Evaluation Report in the manner
provided in this clause (b), notify the Banks of such redetermination and, if
such redetermination is approved by the Majority Banks (or, in the case of an
increase in the Borrowing Base, each of the Banks), notify the Borrower of the
Borrowing Base as so redetermined (or, if the Administrative Agent’s
redetermination is not approved, notify the Borrower of the Borrowing Base as
redetermined by the Majority Banks (or, in the case of an increase in the
Borrowing Base, each of the Banks)) and such redetermined Borrowing Base shall
become effective on the Determination Date immediately following each Report
Delivery Date and shall remain effective until again redetermined as provided in
this Section
1.03(b) (subject to any adjustments and redeterminations provided for by
Sections
1.03(c), 1.03(d) and 1.03(e) hereof,
reductions pursuant to Section 2.10(b),
Section 2.10(c)
and Section 2.10(d)
and Section
9.22 hereof).  The determination by the Administrative Agent
(and as approved or redetermined by the Majority Banks (or, in the case of an
increase in the Borrowing Base, each of the Banks)), of the Borrowing Base for
any Determination Period shall be made on the basis of customary loan parameters
of the Banks for production loans to similarly situated companies which shall
include the Present Value of Reserves attributable to Hydrocarbon Properties as
set forth in the applicable Reserve Evaluation Report for such Determination
Period, subject, however, to such adjustments as the Administrative Agent, with
the concurrence of the Majority Banks, may make in its and their sole discretion
to the rates (including without limitation discount rates), factors, values,
assumptions, prices and costs set forth in such Reserve Evaluation Report and
any other relevant information or factors, including without limitation, any
additional Indebtedness or other obligations that have been incurred or that the
Borrower or its Restricted Subsidiaries intend to incur that the Majority Banks
may reasonably deem appropriate.

      
        
           

        

        
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      (iii)           The
Borrower may request that the Administrative Agent and the Banks give value to
Hydrocarbon Properties located outside of Colombia in determining or
redetermining the Borrowing Base (“Foreign Assets”);
provided that
no such Foreign Assets shall be given value in the Borrowing Base unless
approved by the Administrative Agent and the Majority Banks (or, in the case of
an increase in the Borrowing Base, each of the Banks); provided further that
(A) the Borrower has obtained and continues to maintain political risk insurance
acceptable to the Administrative Agent (if required by the Majority Banks)
covering such Foreign Assets and naming the Banks as additional insured parties,
(B) the Borrower or such Restricted Subsidiary shall (as the case may be) have
granted to the Banks a Lien on such Foreign Assets substantially equivalent to a
first priority mortgage, and a first priority pledge of the equity interest in
the entity holding such Foreign Assets, or if a Lien substantially equivalent to
a first mortgage or pledge of equity interest is unavailable by operation of
law, such other security as the Administrative Agent (in consultation with the
Majority Banks) shall reasonably determine, each such security document to be in
form and substance reasonably satisfactory to the Administrative Agent, (C) the
Borrower delivers a Reserve Evaluation Report prepared by an Independent
Petroleum Engineer with respect to such Foreign Assets, (D) the Administrative
Agent shall have received such legal opinions in form and substance satisfactory
to the Administrative Agent and covering such items as the Administrative Agent
may reasonably request and (E) the Administrative Agent shall have received (or
the Borrower or such Restricted Subsidiary (as the case may be) shall file, as
appropriate) such other documentation as is customarily delivered in connection
with the granting of a Lien on such Foreign Assets.

       

      (c)           Material
Change.  The Borrower agrees to notify the Administrative Agent
promptly of any material change of which the Borrower or any of the Restricted
Subsidiaries is aware which reduces or is reasonably likely to result in a
reduction of the Borrowing Base by more than 10%.

      
        
           

        

        
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      (d)           Interim
Redeterminations.  If (i) the Borrower terminates any Commodity
Hedging Agreements that were previously the basis for an increase in the
Borrowing Base, or (ii) so requested by the Majority Banks or the Borrower at
any time after any change in commodity prices, applicable laws, contracts,
material reserve additions, drilling results or the Hydrocarbon Properties as a
result of acquisitions or Dispositions or the pricing parameters that the Banks
apply to similar production loans for similarly situated companies, that are
reasonably expected to result in a change of the Borrowing Base by more than 5%
or the Borrower or any of its Restricted Subsidiaries enters into a Commodity
Hedging Agreement and requests the Banks to evaluate the effect of such
Commodity Hedging Agreements on the Borrowing Base (provided that the
Majority Banks (collectively) pursuant to this clause (ii) and the Borrower may
each only make one such request in any 12-month period), or (iii) so requested
by the Majority Banks or the Borrower at any time (provided that the
Majority Banks (collectively) or the Borrower pursuant to this clause (iii) may
only make one such request in any 12-month period), the Administrative Agent
shall, as promptly as reasonably practicable after the receipt of such request
or in the case of clause (i) above, receives notice of the occurrence of the
applicable event, endeavor to redetermine (in consultation with the Majority
Banks) the Borrowing Base as then in effect on the basis of the then most recent
Reserve Evaluation Report or such new Reserve Evaluation Report, which in the
case of material reserve additions or acquisitions shall be prepared by an
Independent Petroleum Engineer, delivered with such request (subject, however,
to such additional adjustments to the rates, factors, values, estimates,
assumptions and computations as set forth therein as the Administrative Agent,
with the concurrence of the Majority Banks, may determine to be appropriate in
accordance with their current parameters for similar production loans for
similarly situated companies) and any other relevant information and factors,
including, without limitation, any additional Indebtedness or other obligations
that have been or are reasonably anticipated to be incurred by the Borrower and
its Restricted Subsidiaries and any Hydrocarbon Properties (and assets relating
thereto) acquired by the Borrower and its Restricted Subsidiaries (which are not
subject to any Lien other than Liens created under the Security Documents or
Permitted Liens) that the Administrative Agent (in consultation with the
Majority Banks) may deem appropriate and as otherwise provided in Section 1.03(b)
hereof; provided that, except
with the prior written consent of the Majority Banks, no Hydrocarbon Properties
acquired by any Subsidiary of the Borrower shall be included in the calculation
of the Borrowing Base unless such Subsidiary is or becomes an Obligor under this
Agreement.  As promptly as reasonably practicable following its
redetermination of the Borrowing Base, the Administrative Agent shall notify the
Banks of such redetermination and, if such redetermination is approved by the
Majority Banks (or each of the Banks in the case of an increase in the Borrowing
Base), notify the Borrower in writing of the Borrowing Base as so redetermined
(and in any event not later than the Determination Date with respect to such
redetermination) and such redetermined Borrowing Base shall become effective
immediately upon delivery to the Borrower of such notice of
redetermination.  The Borrower agrees that, in addition to any other
rights that the Administrative Agent and the Banks may have under the Loan
Documents, immediately upon receipt of notice by the Administrative Agent that
the events described in clauses (i), (ii) or (iii) above have occurred which
result in the occurrence of a Borrowing Base Deficiency, the Administrative
Agent has the right to require JPMorgan Chase Bank, N.A., BNP Paribas or such
other financial institution with which any Collection Account is maintained to
cease honoring instructions from the Borrower in whose name a Collection Account
is maintained and retain the funds in such Collection Account or as directed by
the Administrative Agent, until (x) the Administrative Agent gives notice to
JPMorgan Chase Bank, N.A., BNP Paribas or such other financial institution to
honor instructions from the Borrower or (y) the total Loans and Letter of Credit
Liabilities outstanding herein are less than the Borrowing Base as redetermined
by the Administrative Agent.

      
        
           

        

        
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      (e)           Determinations,
Etc.  Notwithstanding any other provision of this Agreement to
the contrary, all determinations and redeterminations and adjustments by the
Administrative Agent (and any determinations and decisions by each of the Banks
or Majority Banks in connection therewith, or in connection with the provisions
of Section 2.10
or Section
9.22, including any thereof approving or disapproving a proposed
redetermination or redetermination by the Administrative Agent or effecting any
adjustment to any element included in a Reserve Evaluation Report or the
determination or redetermination of the Borrowing Base) shall be made on a
reasonable basis, in good faith and in a manner reasonably consistent with their
loan parameters for similar production loans for similarly situated companies
and consistent with the basis on which the initial Borrowing Base was determined
to be acceptable to the Banks (but after giving effect to changes in facts and
circumstances occurring after the date of such initial determination including,
but not limited to, reserves and production, operating expenses, Commodity
Hedging Agreement and economic assumptions with respect to price of Hydrocarbons
and inflation), and any such determination, redetermination or adjustment shall
consider any other relevant information or factors, including without
limitation, any additional Indebtedness or other obligations that have been
incurred or that the Borrower and its Restricted Subsidiaries intend or expect
to incur that the Majority Banks may deem appropriate; provided that, unless
otherwise accepted by the Majority Banks, no Hydrocarbon Properties acquired by
any Subsidiary of the Borrower shall be included in the calculation of the
Borrowing Base unless such Subsidiary is an Obligor under this Agreement; provided further
that, for the period from (and including) the Closing Date to (but excluding)
the Step-Up Date, the Borrowing Base shall not exceed $7,000,000.

       

      1.04  Designation of Subsidiaries
as Restricted or Unrestricted Subsidiaries.  By delivery to the
Administrative Agent of a new Schedule III and Schedule VII hereto and with the
approval of the Majority Banks, such approval not to be unreasonably withheld,
the Borrower may designate a Restricted Subsidiary (other than a Subsidiary
Guarantor, unless the Majority Banks provide prior written consent to such
designation) to be an Unrestricted Subsidiary or an Unrestricted Subsidiary to
be a Restricted Subsidiary; provided that the
Borrower may, without such approval, designate (by notice to the Administrative
Agent which shall promptly notify the Banks) a corporation or other entity that
is formed or acquired as a direct or indirect Subsidiary of the Borrower after
the date of this Agreement (no part of the business or assets of which was owned
by the Borrower or a Restricted Subsidiary prior to the date of such formation
or acquisition and included in the Borrowing Base or used in connection with the
exploration, exploitation, transportation or marketing of Hydrocarbons from
properties included in the Borrowing Base) to be an Unrestricted Subsidiary on
or prior to the date of such formation or acquisition if, after giving effect
thereto, the Borrower would be in compliance with its obligations with respect
to such Subsidiary as an Unrestricted Subsidiary under Section 9.17 hereof
and no other Default shall have occurred and be continuing.

      
        
           

        

        
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      1.05  Restricted Subsidiaries Not
Directly or Indirectly Owned or Controlled by the
Borrower.  With respect to any Restricted Subsidiary party to
this Agreement from time to time that would, but for the deeming provisions in
the proviso to the definition of “Subsidiary”, not be considered a Subsidiary of
the Borrower: 

       

      (a)           the
phrase “the Borrower shall, and shall cause each of its Restricted Subsidiaries
to” (or substantially similar phrases) in this Agreement shall be understood to
mean “the Borrower and the Restricted Subsidiaries shall”; and 

       

      (b)           the
phrase “the Borrower shall not, nor shall it permit any of its Restricted
Subsidiaries to” (or substantially similar phrases) in this Agreement shall be
understood to mean “the Borrower and the Restricted Subsidiaries shall
not”.

       

      SECTION
2.

      COMMITMENTS,
LOANS, NOTES AND PREPAYMENTS.

       

      2.01  Loans.

       

      (a)           Each
Bank severally agrees, in accordance with the terms and conditions of this
Agreement, to make one or more loans (each a “Loan”) to the
Borrower during the Commitment Period in an aggregate amount up to but not
exceeding the lesser of (x) its Commitment and (y) an amount equal to its
Commitment Percentage multiplied by the then effective Borrowing Base; provided that (i)
except during a Deficiency Cure Period, in no event shall the aggregate
principal amount of all Loans and the aggregate amount of all Letter of Credit
Liabilities exceed the lesser of (x) the aggregate amount of the Commitments as
in effect from time to time, and (y) the then effective Borrowing Base and (ii)
the Borrower may not borrow additional Loans or obtain additional Letters of
Credit at any time while a Borrowing Base Deficiency exists, but may, subject to
the other terms of this Agreement, continue a Loan while a Borrowing Base
Deficiency exists on the last day of the Interest Period of such Loan and in an
amount equal to the principal amount of such Loan.

       

      (b)           Subject
to the terms and conditions of this Agreement, during the Commitment Period, the
Borrower may borrow, repay and reborrow the Loans; provided that no more
than five separate Interest Periods may be outstanding at any one
time.

       

      2.02  Borrowings.  The
Borrower shall give the Administrative Agent (which shall promptly notify the
relevant Banks) notice of each borrowing hereunder as provided in Section 4.05
hereof.  Not later than 1:00 p.m. New York time on the date specified
for each borrowing hereunder, each relevant Bank shall make available the amount
of the Loan or Loans to be made by it on such date to the Administrative Agent,
at an account specified by the Administrative Agent maintained by the
Administrative Agent, in immediately available funds, for the account of the
Borrower.  The amount so received by the Administrative Agent shall,
subject to the terms and conditions of this Agreement, be made available to the
Borrower by depositing the same, in immediately available funds, in an account
of the Borrower designated by the Borrower in
writing.  Notwithstanding any provision of this Agreement to the
contrary, Loans may only be denominated in US Dollars.

      
        
           

        

        
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      2.03  Letters of
Credit.

       

      (a)           Issuance.  Subject
to the terms and conditions of this Agreement, the Commitments may be utilized,
upon the request of the Borrower, in addition to the Loans provided for by Section 2.01(a)
hereof, by the issuance by an Issuing Bank of letters of credit (collectively,
“Letters of
Credit”) in US Dollars for account of the Borrower; provided that if any
Letter of Credit is cash collateralized by the Borrower through a deposit in an
account acceptable to the Issuing Bank, or is fully guaranteed by EDC on terms
in form and substance acceptable to the Majority Banks, the Commitments shall be
deemed not to have been utilized to the extent of the amount of cash collateral
so deposited or the amount of the EDC guarantee, as the case may
be.  Except during a Deficiency Cure Period, in no event shall (i) the
aggregate amount of all Letter of Credit Liabilities and the aggregate principal
amount of the Loans exceed the lesser of (A) the aggregate of the Commitments
and (B) the then effective Borrowing Base, (ii) the outstanding aggregate amount
of all Letter of Credit Liabilities, at the time of the issuance of any Letter
of Credit, exceed $5,000,000 and (iii) the expiration date of any Letter of
Credit extend beyond the date which is five Business Days prior to the Maturity
Date.  The Issuing Bank shall be deemed to hold a Letter of Credit
Liability in an amount equal to its retained interest in the related Letter of
Credit after giving effect to the acquisition by the Banks other than the
Issuing Bank of their participation interests under this Section
2.03.

       

      (b)           Letters of Credit
Generally.  The following additional provisions shall apply to
Letters of Credit:

       

      (i)           The
Borrower shall give the Administrative Agent at least three Business Days’
irrevocable prior notice (effective upon receipt) specifying the Business Day
(which shall be no later than 30 days preceding the Maturity Date) each Letter
of Credit that the Borrower is requesting to be issued, the beneficiary and the
account party or parties therefor and describing in reasonable detail the
proposed terms of such Letter of Credit (including the beneficiary thereof) and
the nature of the obligations proposed to be supported thereby.  Each
such notice shall be irrevocable and binding on the Borrower.  Upon
receipt of any such notice, the Administrative Agent shall on the same day
advise the Issuing Bank and each Bank of the contents thereof.

      
        
           

        

        
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      (ii)           On
each day during the period commencing with the issuance by the Issuing Bank of
any Letter of Credit and until such Letter of Credit shall have expired or been
terminated, each Bank’s Commitment shall be deemed to be utilized for all
purposes of this Agreement in an amount equal to its Commitment Percentage in US
Dollars of the then undrawn face amount of such Letter of Credit, subject to the
proviso in Section
2.03(a) hereof.  Each Bank (other than the Issuing Bank) agrees
that, upon the issuance of any Letter of Credit hereunder, it shall
automatically acquire a participation in the Issuing Bank’s liability under such
Letter of Credit in an amount equal to its Commitment Percentage of such
liability, and each such Bank (other than the Issuing Bank) thereby shall
absolutely, unconditionally and irrevocably assume, as primary obligor and not
as surety, and shall be unconditionally obligated to the Issuing Bank to pay and
discharge when due, its Commitment Percentage of the Issuing Bank’s liability
under such Letter of Credit.

       

      (iii)           Upon
receipt from the beneficiary of any Letter of Credit of any demand for payment
under such Letter of Credit, the Issuing Bank shall promptly notify the Borrower
and each Bank (in each case through the Administrative Agent) of the amount to
be paid by the Issuing Bank as a result of such demand, the date on which
payment is to be made by the Issuing Bank to such beneficiary in respect of such
demand and the amount required by each Bank to reimburse the Issuing Bank,
specifying such Bank’s Commitment Percentage of the amount of the related demand
for payment.  The amount of such payment shall be deemed to be a Loan
to the Borrower, with an Interest Period of one month (unless otherwise selected
by the Borrower pursuant to Section
4.05).

       

      (iv)           In
respect of any Letter of Credit, each Bank having a Letter of Credit Liability
with respect to such Letter of Credit (other than the Issuing Bank) shall, upon
demand by the Administrative Agent under clause (iii) above, pay to the
Administrative Agent for the account of the Issuing Bank at an account specified
by the Issuing Bank maintained with the Administrative Agent and in immediately
available funds, the amount of its Commitment Percentage of any payment under
such Letter of Credit upon notice by the Issuing Bank (through the
Administrative Agent) to such Bank requesting such payment and specifying such
amount.  Such Bank’s obligation to make such payments to the
Administrative Agent for account of the Issuing Bank under this clause (iv), and
the Issuing Bank’s right to receive the same, shall be absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including, without limitation, (x) the failure of any other Bank to make its
payment under this clause (iv), the financial condition of the Borrower or any
other Obligor (or any other account party), the existence of any Default or (y)
the termination of the Commitments.  Each such payment to the Issuing
Bank shall be made without any offset, abatement, withholding or reduction
whatsoever.  If such Bank shall default in its obligation to make any
such payment to the Administrative Agent for the account of the Issuing Bank,
for so long as such default shall continue the Administrative Agent shall at the
request of the Issuing Bank withhold from any payments received by the
Administrative Agent under this Agreement or any Note for account of such Bank
the amount so in default and the Administrative Agent shall pay the same to the
Issuing Bank in satisfaction of such defaulted obligation.

      
        
           

        

        
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    (v)           Except
as provided in clauses (A) and (B) below, the Borrower agrees to pay to the
Administrative Agent for account of each Bank in respect of each Letter of
Credit issued for the Borrower an issuance fee in an amount equal, in the
aggregate, to 3.0% per annum multiplied by the undrawn face amount of such
Letter of Credit for the period from and including the date of issuance of such
Letter of Credit to and including the date such Letter of Credit is drawn in
full, expires or is terminated (such fee to be non-refundable, to be paid in
arrears on each Quarterly Date and on the Commitment Termination Date and to be
calculated, for any day, after giving effect to any payments made under (or cash
collateral provided or EDC guarantee granted in respect of) such Letter of
Credit on such day); provided that in all
cases:

     

    (A)           for
each Letter of Credit that is cash collateralized by the Borrower through a
deposit in an account acceptable to the Issuing Bank of an amount equal to at
least the full undrawn face amount of such Letter of Credit, the per annum
letter of credit fee for such cash collateralized Letter of Credit shall be an
amount equal to 0.50% multiplied by the undrawn face amount of such Letter of
Credit with effect from the date such Letter of Credit was cash collateralized,
and

     

    (B)           for
each Letter of Credit that is fully guaranteed by EDC on terms in form and
substance acceptable to the Majority Banks, the per annum letter of credit fee
for such guaranteed Letter of Credit shall be an amount equal to 0.75%
multiplied by the undrawn face amount of such Letter of Credit with effect from
the date such Letter of Credit was guaranteed by EDC,

     

    in each
case, for the period such Letter of Credit is to be outstanding.  The
Administrative Agent shall pay to each Bank (other than the Issuing Bank), from
time to time at reasonable intervals (but in any event at least on each
Quarterly Date), but only to the extent actually received from or on behalf of
the Borrower, an amount equal to such Bank’s Commitment Percentage of all such
fees in respect of each Letter of Credit (including any such fee in respect of
any period of any renewal or extension thereof).

     

    (vi)          Promptly
following the end of each calendar month, each Issuing Bank shall deliver
(through the Administrative Agent) to each Bank and the Borrower notice
describing all Letters of Credit issued by the Issuing Bank outstanding at the
end of such month.  Upon the request of any Bank from time to time,
each Issuing Bank shall deliver any other information in its possession
reasonably requested by the Bank with respect to each Letter of Credit then
outstanding and issued by the Issuing Bank.

     

    
      
        
        

      

      
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    (vii)         The
issuance of each Letter of Credit by the Issuing Bank shall, in addition to the
conditions precedent set forth in Section 7 hereof, be
subject to the conditions precedent that (A) such Letter of Credit shall support
such transactions as are consistent with Section 9.14, be in
such form and contain such terms as shall be satisfactory to the Issuing Bank,
acting reasonably, consistent with its then current practices and procedures
with respect to letters of credit of the same type and (B) the Borrower shall
have executed and delivered such applications, agreements and other instruments
relating to such Letter of Credit as the Issuing Bank shall have reasonably
requested consistent with its then current practices and procedures with respect
to letters of credit of the same type; provided that in the
event of any conflict between any such application, agreement or other
instrument and the provisions of this Agreement or any Security Document, the
provisions of this Agreement and the Security Documents shall
control.

     

    (viii)        In
connection with any Letter of Credit, to the extent that any Bank fails to pay
any amount required to be paid pursuant to clause (iv) of this Section 2.03(b) on
the due date therefor, such Bank shall pay interest to the Issuing Bank (through
the Administrative Agent) on such amount from and including such due date to but
excluding the date such payment is made, during the period from and including
such due date to but excluding the date three Business Days thereafter, at a
rate per annum equal to the Eurodollar Rate (for three-month Eurodollar Loans)
in an amount equal to the amount of such required payment (as in effect from
time to time) plus the Applicable
Margin plus
Mandatory Costs, if any, plus 2%.

     

    (ix)           Without
the prior written consent of the Issuing Bank, no Letter of Credit shall be
issued in face amount of less than $250,000.

     

    As
between the Borrower and the Issuing Bank, the Borrower assumes all risks for
the acts and omissions of, or misuse of, the Letters of Credit by the respective
beneficiaries of such Letter of Credit.  The Borrower hereby
indemnifies and holds harmless each Bank, the Issuing Bank and the
Administrative Agent from and against any and all claims and damages, losses,
liabilities, costs or expenses which such Bank, the Issuing Bank or the
Administrative Agent may incur (or which may be claimed against such Bank, the
Issuing Bank or the Administrative Agent by any Person whatsoever) by reason of
or in connection with (1) any loss or expense incurred by such Bank or the
Issuing Bank as a result of the Borrower’s failure to honor or fulfill, before
the date specified for the issuance of any Letter of Credit, the applicable
conditions set forth in Section 7 or this
Section 2.03 if
the Letter of Credit is not issued on that date because of that
failure;  and (2) the execution, delivery, issuance or transfer of or
payment or refusal to pay by the Issuing Bank under any Letter of Credit; provided that the
Borrower shall not be required to indemnify any Bank, the Issuing Bank or the
Administrative Agent for any claims, damages, losses, liabilities, costs or
expenses to the extent, but only to the extent, caused by (x) the willful
misconduct or gross negligence of the Issuing Bank in determining whether a
request presented under any Letter of Credit complied with the terms of such
Letter of Credit or (y) the Issuing Bank’s failure to pay under any Letter of
Credit after the presentation to it of a request strictly complying with the
terms and conditions of such Letter of Credit.  Nothing in this Section 2.03 is
intended to limit the other obligations of any Obligor, any Bank, the Issuing
Bank or the Administrative Agent under this Agreement.

     

    
      
        
        

      

      
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    2.04  Changes of
Commitments.  (a) The aggregate unused amount of the
Commitments shall be automatically reduced to zero on the Commitment Termination
Date.

     

    (b)           The
Borrower shall have the right at any time or from time to time (i) so long as no
Loans or Letter of Credit Liabilities are outstanding, to terminate the
Commitments, and (ii) to reduce the Commitments in part up to the aggregate
unused amount of the Commitments; provided that (x) the
Borrower shall give notice of each such termination or reduction as provided in
Section 4.05
hereof and (y) each partial reduction shall be in an aggregate amount at least
equal to $1,000,000 or in multiples of $500,000 in excess thereof.

     

    (c)           The
Borrower shall notify the Administrative Agent of any election to terminate or
reduce the Commitments under paragraph (b) of this Section at least three
Business Days prior to the effective date of such termination or reduction,
specifying such election and the effective date thereof.  Promptly
following receipt of any notice, the Administrative Agent shall advise the
relevant Banks of the contents thereof.  Each notice delivered by the
Borrower pursuant to this Section shall be irrevocable; provided that a
notice of termination of the Commitments delivered by the Borrower may state
that such notice is conditioned upon the effectiveness of other credit
facilities, in which case such notice may be revoked by the Borrower (by notice
to the Administrative Agent no later than two Business Days prior to the
proposed effective date of such termination) if such condition is not
satisfied.  Any termination or reduction of the Commitments shall be
permanent.  Each reduction of the Commitments shall be made ratably
among the Banks in accordance with their respective Commitments.

     

    2.05  Commitment
Fee.  The Borrower shall pay to the Administrative Agent for
the account of each Bank in proportion to its respective Commitment Percentage,
a commitment fee for each day at a rate per annum equal to the Applicable
Commitment Fee Rate times such Bank’s
Commitment, less the aggregate
principal amount of all Loans and Letter of Credit Liabilities outstanding on
such day for the period from and including the Closing Date to but not including
the earlier of the date such Bank’s Commitment is terminated and the Commitment
Termination Date.  The accrued amount of such commitment fees shall be
payable monthly in arrears and on the Commitment Termination Date.

     

    2.06  Lending
Offices.  The Loans made by each Bank shall be made and
maintained at such Bank’s Applicable Lending Office.

     

    
      
        
        

      

      
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    2.07  Several Obligations;
Remedies Independent.  With respect to any Loan or Letter of
Credit, the failure of any Bank to make any Loan or provide proceeds in respect
of a Letter of Credit on the date specified therefor shall not relieve any other
Bank of its obligation to make its Loan or provide such proceeds on such date,
but neither any Bank nor the Administrative Agent shall be responsible for the
failure of any other Bank to make a Loan or provide such proceeds to be made or
provided by such other Bank, and no Bank shall have any obligation to the
Borrower, the Administrative Agent or any other Bank for the failure by such
other Bank to make any Loan or provide such proceeds required to be made or
provided by such Bank.  The amounts payable by the Borrower or any
Obligor at any time hereunder and under the Notes or pursuant to its Guarantee
under Section
6, as the case may be, to each Bank shall be a separate and independent
debt, and each Bank shall be entitled to protect and enforce its rights arising
out of this Agreement, the Notes and the other Loan Documents subject to Section 4.08 and
Section 10
hereof, and it shall not be necessary for any other Bank or the Administrative
Agent to consent to, or be joined as an additional party in, any proceedings for
such purposes.

     

    2.08  Notes.  (a)
Each Loan made by each Bank shall be evidenced by a promissory note of the
Borrower substantially in the form of Exhibit A hereto, dated as of the Closing
Date, payable to such Bank in a principal amount equal to the amount of its
Commitment as originally in effect and otherwise duly completed.

     

    (b)           The
date, amount, interest rate and duration of Interest Period (if applicable) of
each Loan made by each Bank to the Borrower, and each payment made on account of
the principal thereof, shall be recorded by such Bank on its books and, prior to
any transfer of the Note evidencing the Loans held by it, endorsed by such Bank
on the schedule attached to such Note or any continuation thereof; provided that the
failure of such Bank to make any such recordation or endorsement shall not
affect the obligations of the Borrower to make a payment when due of any amount
owing hereunder or under such Note in respect of the Loans evidenced by such
Note.

     

    (c)           No
Bank shall be entitled to have its Notes subdivided, by exchange for promissory
notes of lesser denominations or otherwise, except in connection with a
permitted assignment of all or any portion of such Bank’s Commitment, Loans and
Note pursuant to Section 12.06(b)
hereof.

     

    2.09.  Optional Prepayments of
Loans.  Subject to Section 4.04 hereof,
the Borrower shall have the right to prepay Loans, without premium or penalty,
at any time or from time to time; provided that the
Borrower shall give the Administrative Agent notice of such prepayment as
provided in Section
4.05 hereof (and, upon the date specified in any such notice of
prepayment, the amount to be prepaid shall become due and payable
hereunder).

     

    
      
        
        

      

      
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    2.10  Mandatory
Prepayments.

     

    (a)           Borrowing
Base.  The Administrative Agent shall notify the Borrower (in a
“Deficiency
Notice”) as soon as reasonably practicable after becoming aware at any
time that the Borrowing Base as then in effect is less than the sum of the
aggregate principal amount of the Loans and Letter of Credit Liabilities
outstanding at such time (the amount of such difference being called herein the
“Borrowing Base
Deficiency”) and within 15 days after the date of delivery of the
Deficiency Notice the Borrower shall notify the Administrative Agent of the
Borrower’s intentions with respect to compliance with the procedures set forth
in this Section
2.10(a).  As specified in such notice from the Borrower, the
Borrower shall within 45 days after the date of the Deficiency Notice (the
“Deficiency Cure
Period”) prepay, or provide cover in accordance with Section 2.10(e)
hereof, the aggregate principal amount of all Loans and Letter of Credit
Liabilities outstanding at such time, in an amount sufficient to eliminate such
Borrowing Base Deficiency.  During a Deficiency Cure Period, any
amount deposited in each Collection Account shall be retained therein, and no
withdrawal may be made from any Collection Account without the prior written
consent of the Administrative Agent.  Upon its receipt of evidence to
its reasonable satisfaction of the elimination of the Borrowing Base Deficiency
giving rise to the Deficiency Notice in question, the Administrative Agent shall
notify the Borrower accordingly and thereafter, withdrawals may be made from
each Collection Account as if such Borrowing Base Deficiency had not
occurred.

     

    (b)           Casualty
Events.  Upon the date (the “Insurance Date”) 30
days following the receipt by the Borrower or any of its Restricted Subsidiaries
of the Net Available Proceeds of insurance, condemnation award or other
compensation, in each case in excess of $2,000,000 (or its equivalent in other
currencies, calculated as of the date such proceeds are received) in respect of
any Casualty Event, affecting (i) any Hydrocarbon Property of the Borrower or
any Restricted Subsidiary or (ii) any Foreign Assets of the Borrower or any
Restricted Subsidiary, the Borrower shall, or as applicable, shall cause the
applicable Restricted Subsidiary to (in each case, only if required by the
Administrative Agent to do so) repay the Loans to the extent of such Net
Available Proceeds (and/or provide cash collateral for the Letter of Credit
Liabilities as specified in clause (e) below), and if such Casualty Event or
series of related Casualty Events shall result in the receipt by the Borrower or
any of its Restricted Subsidiaries of Net Available Proceeds in excess of
$2,000,000 (or its equivalent amount in other currencies, calculated as of the
date such proceeds are received) in any Determination Period, the Majority
Banks, based on their review of such Casualty Event, may reduce the Borrowing
Base, such reduction in any event not to be in an aggregate amount in excess of
100% of the Net Available Proceeds of such Casualty Event, or such lesser amount
as may be specified in a written notice from the Majority Banks, such prepayment
and reduction to be effected in each case in the manner and to the extent
specified in clause (e) of this Section
2.10.  Nothing in this clause (b) shall be deemed to limit any
obligation of the Borrower and any of its Restricted Subsidiaries pursuant to
any of the Security Documents to remit to a collateral or similar account
maintained by the Administrative Agent the proceeds of insurance, condemnation
award or other compensation received in respect of any Casualty
Event.

     

    
      
        
        

      

      
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    (c)           Sale of
Assets.  Without limiting the obligation of the Obligors to
obtain the consent of the Majority Banks pursuant to Section 9.05 hereof
to any Disposition not otherwise permitted hereunder, no later than five
Business Days prior to the occurrence of any Disposition permitted under Section 9.05 of this
Agreement and expected to result in Net Available Proceeds in excess of
$1,000,000 (or its equivalent amount in other currencies, calculated as of the
date such proceeds are received), the Borrower, on behalf of the applicable
Obligor, shall deliver to the Banks a statement, certified by a senior officer
or director of the Borrower, in form and detail satisfactory to the
Administrative Agent, acting reasonably, of the estimated amount of the Net
Available Proceeds of such Disposition and, if (i) the Net Available Proceeds of
such Disposition is in excess of $2,000,000 (or its equivalent amount in other
currencies, calculated as of the date such proceeds are received), in respect of
(A) assets which have been given value in determining the Borrowing Base or (B)
assets which have not been given value in determining the Borrowing Base but
which are directly related to exploration, production or transportation of
Hydrocarbons or (ii) the Net Available Proceeds of such Disposition together
with the aggregate of all other such Dispositions by any Obligor within any
six-month period (including as a result of any Casualty Event) of any
Hydrocarbon Property or other Property is in excess of $3,000,000 (or its
equivalent amount in other currencies, calculated as of the date such proceeds
are received), then the Majority Banks, based on their review of the statement
referred to in this Section 2.10(c) may
reduce the Borrowing Base in an aggregate amount determined in accordance with
Section
1.03(e); provided that if the
Net Available Proceeds include consideration other than cash or cash
equivalents, (i) the Administrative Agent shall reduce the Borrowing Base by an
amount, based on its reasonable determination of the Borrowing Base attributable
to the assets for which such non-cash or non-cash equivalent consideration was
received and (ii) the Administrative Agent and the Banks shall endeavor to
redetermine the Borrowing Base (within 60 days of the later of (x) the receipt
by the Administrative Agent of a Reserve Evaluation Report or other
documentation or information reasonably requested by the Administrative Agent
and (y) the date of acquisition of such non-cash consideration) based on the
value of the non-cash consideration received.  If a Borrowing Base
Deficiency results from such reduction, then the Borrower shall, notwithstanding
Section 2.10(a)
to the contrary, immediately prepay the Loans (and/or provide cash collateral
for the Letter of Credit Liabilities) to cure such deficiency.  The
Administrative Agent shall endeavor to advise the Borrower within 15 days
following receipt of any such statement of the proposed redetermined Borrowing
Base that the Administrative Agent shall recommend to the
Banks;  provided that the
Administrative Agent shall have no liability for failure to so advise the
Borrower.

     

    (d)           Application.  Prepayments
and reductions of the Borrowing Base, if applicable, described in the above
clauses of this Section 2.10 shall be
effected as follows:  the Borrowing Base shall be automatically
reduced by an amount equal to the amount specified in such clauses (and to the
extent that, after giving effect to such reduction, the aggregate principal
amount of the Loans, together with the aggregate amount of all relevant Letter
of Credit Liabilities, would exceed the then effective Borrowing Base, the
Borrower shall, subject to the provisions relating to a Deficiency Cure Period,
first, prepay the Loans and second, provide cash collateral for such Letter of
Credit Liabilities with respect to the Borrowing Base, as specified in clause
(e) below, in an aggregate amount equal to such excess).

     

    
      
        
        

      

      
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    (e)           Cash Collateral for Letter
of Credit Liabilities.  In the event that the Borrower shall be
required pursuant to this Section 2.10, or
pursuant to Section
3.01 hereof, to provide cash collateral for Letter of Credit Liabilities,
the Borrower shall effect the same by paying to the Administrative Agent
immediately available funds in an amount equal to the required amount, which
funds shall be retained by the Administrative Agent as collateral security for
the Letter of Credit Liabilities until such time as the Letters of Credit shall
have been terminated and/or all of the Letter of Credit Liabilities have been
paid in full or the Borrowing Base shall be increased to an amount sufficient to
support such Letter of Credit Liabilities.  Notwithstanding any other
provision of this Agreement to the contrary, the Borrower shall not be required
to provide any such cash collateral to the extent that any such Letter of Credit
Liabilities are fully guaranteed by EDC on terms in form and substance
acceptable to the Majority Banks.

     

    SECTION
3.

    PAYMENTS
OF PRINCIPAL AND INTEREST

     

    3.01  Repayment of
Loans.  The Borrower hereby promises to pay to the
Administrative Agent for the account of each Bank the entire outstanding
principal amount of such Bank’s Loans and each Loan shall mature, on the
Maturity Date.  All Letter of Credit Liabilities then outstanding (net
of all cash collateral for any such liabilities held at that time pursuant to
Section 2.10(e)
hereof) shall be payable to the Administrative Agent for the account of each
Bank having a participation therein on the Commitment Termination
Date.  In addition, if following any reduction in the Commitments, the
aggregate principal amount of the Loans, together with the aggregate amount of
all Letter of Credit Liabilities shall exceed the Commitments, the Borrower
shall first, prepay Loans and second, provide cash collateral for Letter of
Credit Liabilities with respect to the Commitments as specified in Section 2.10(e)
above, in an aggregate amount equal to such excess.

     

    3.02  [Intentionally
Omitted]

     

    3.03  Interest.  (a)
The Borrower hereby promises to pay to the Administrative Agent for the account
of each Bank interest on the unpaid principal amount of each Loan made by such
Bank and on any Reimbursement Obligation for the period from and including the
date of such Loan to but excluding the date such Loan shall be paid in full for
each Interest Period relating thereto, at a rate per annum equal to the
Eurodollar Rate for such Loan for such Interest Period plus the Applicable
Margin plus
Mandatory Costs, if any.  Notwithstanding the foregoing, the Borrower
hereby promises to pay to the Administrative Agent for account of each Bank
interest at the applicable Post-Default Rate on any principal of any Loan made
by such Bank, on any Reimbursement Obligation held by such Bank and on any other
amount payable by the Borrower hereunder or under the Note held by such Bank to
or for account of such Bank, which shall not be paid in full when due (whether
at stated maturity, by acceleration, by mandatory prepayment or otherwise), for
the period from and including the due date thereof to but excluding the date the
same is paid in full.

     

    
      
        
        

      

      
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    (b)           Accrued
interest on each Loan shall be payable (i) at the end of each Interest Period
and (ii) upon the payment or prepayment thereof (but only on the principal
amount so paid or prepaid), except that interest payable at the Post-Default
Rate shall be payable from time to time on demand.  In connection with
each Loan, promptly after the determination of any interest rate provided for
herein or any change therein, the Administrative Agent shall give notice thereof
to the Banks and to the Borrower, but failure to do so on a timely basis or at
all shall not affect the Borrower’s obligation to pay interest for any period at
the applicable rate determined by the Administrative Agent.

     

    3.04  Solvency.  Each
Obligor is, and, upon the incurrence of any Loan, Letter of Credit Liability or
Guarantee by such Obligor on any date on which this representation and warranty
is made, shall be, Solvent.

     

    SECTION
4.

    PAYMENTS;
PRO RATA TREATMENT; COMPUTATIONS; ETC.

     

    4.01  Payments.  (a)
Except to the extent otherwise provided herein, all payments of principal,
interest, Reimbursement Obligations and other amounts to be made by the Borrower
under this Agreement and the Notes, and, except to the extent otherwise provided
therein, all payments to be made by the Obligors under any other Loan Document,
shall be made in US Dollars, in immediately available funds, without deduction,
set-off or counterclaim, to the Administrative Agent at its account with
Barclays Bank PLC, New York (Account No. 050035878; SWIFT BARCUS33; ABA
026002574; Ref:TFB/Gran Tierra) or such other account as may be specified by the
Administrative Agent from time to time, not later than 2:00 p.m. London time on
the date on which such payment shall become due (each such payment made after
such time on such due date to be deemed to have been made on the next succeeding
Business Day).

     

    (b)           Any
Bank for whose account any such payment is to be made may (but shall not be
obligated to) debit the amount of any such payment that is not made by such time
(other than any payment not made due to a failure by the Administrative Agent to
forward any such payment to such Bank) to any ordinary deposit account of the
Borrower with such Bank (with notice to the Borrower and the Administrative
Agent); provided that such
Bank’s failure to give such notice shall not affect the validity
thereof.

     

    
      
        
        

      

      
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    (c)           In
connection with making each payment in respect of each Loan or Letter of Credit,
the Borrower shall, at the time of making each payment under this Agreement or
any Note for the account of any Bank, specify to the Administrative Agent (which
shall so notify the intended recipient(s) thereof) the Loans, Reimbursement
Obligations or other amounts payable by the Borrower hereunder to which such
payment is to be applied (and in the event that the Borrower fails to so
specify, or if an Event of Default has occurred and is continuing, the
Administrative Agent may distribute such payment to the Banks for application in
such manner as it or the Majority Banks, and subject to Section 4.02 hereof,
may determine to be appropriate).

     

    (d)           Each
payment received by the Administrative Agent under this Agreement or any Note
for account of any Bank shall be paid by the Administrative Agent promptly to
such Bank, in immediately available funds, for account of such Bank’s Applicable
Lending Office for the Loan or other obligation in respect of which such payment
is made.

     

    (e)           Except
as provided in the last sentence of the definition of Interest Period, if the
due date of any payment under this Agreement or any Note would otherwise fall on
a day that is not a Business Day, such date shall be extended to the next
succeeding Business Day, and interest shall be payable for any principal so
extended for the period of such extension.

     

    4.02  Pro Rata
Treatment.  Except to the extent otherwise provided
herein:  (a) each borrowing of Loans from the Banks under Section 2.01 hereof
shall be made from the Banks, each payment of commitment fee under Section 2.05 hereof
in respect of Commitments shall be made for account of the Banks, and each
termination or reduction of the amount of the Commitments under Section 2.04 hereof
shall be applied to the respective Commitments of the Banks, pro
rata according to the amounts of their respective Commitments; (b) each
payment or prepayment of principal of Loans by the Borrower shall be made for
the account of the Banks pro
rata in accordance with the respective unpaid principal amounts of the
Loans; provided
that if immediately prior to giving effect to any such payment in respect of any
Loans the outstanding principal amount of the Loans shall not be held by the
relevant Banks pro
rata in accordance with their respective Commitments in effect at the
time such Loans were made (whether by reason of a failure of a Bank to make a
Loan in the circumstances described in the second paragraph of Section 12.04 hereof
or otherwise), then such payment shall be applied to the Loans in such manner as
shall result, as nearly as is practicable, in the outstanding principal amount
of the Loans being held by such Banks pro
rata in accordance with their respective Commitments; and (c) each
payment of interest on Loans by the Borrower shall be made for account of the
relevant Banks pro
rata in accordance with the amounts of interest on such Loans then due
and payable to the respective Banks.

     

    4.03  Computations.  Interest
on Loans and commitment fees and letter of credit fees shall be computed on the
basis of a year of 360 days and actual days elapsed (including the first day but
excluding the last day) occurring in the period for which that interest and
those fees are payable.

     

    
      
        
        

      

      
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    4.04  Minimum
Amounts.  Except for mandatory prepayments made pursuant to
Section 2.10
hereof, each borrowing (other than by way of a Letter of Credit) and partial
prepayment of principal of Loans shall be in an aggregate amount at least equal
to $1,000,000 or in multiples of $500,000 in excess thereof.

     

    4.05  Certain
Notices.  Notices by the Borrower to the Administrative Agent
of terminations or reductions of the Commitments and of borrowings and optional
prepayments of Loans and of the duration of Interest Periods for the
continuation of each Loan shall be irrevocable and shall be effective only if
received by the Administrative Agent not later than 11:00 a.m. London time, on
the number of Business Days prior to the date of the relevant termination,
reduction, borrowing or prepayment or the first day of such Interest Period
specified below:

     

    
      
        
          
            
              
                
                  
                    	
                            Notice

                          	 	
                            Number
      of

                            Business

                            Days Prior

                          
	 	 	 
	
                            Termination
      or reduction of Commitments

                          	 	
                            3

                          
	 	 	 
	
                            Borrowing
      or prepayment of or duration of
      Interest Period for Loans

                          	 	
                            3

                          
	 	 	 
	
                            Request
      for issuance or Continuation of
      Letters of Credit

                          	 	
                            3

                          

                  

                

              

            

          

        

      

    

    

    Each such
notice of termination or reduction shall specify the amount of the Commitments
to be terminated or reduced.  Each such notice of borrowing or
optional prepayment shall specify the Loans to be borrowed or prepaid and the
amount (subject to Section 4.04 hereof)
and the date of borrowing or optional prepayment (which shall be a Business Day)
and, if applicable, the relevant Interest Period.  The Administrative
Agent shall promptly notify the Banks of the contents of each such
notice.  In the event that the Borrower fails to select the duration
of any Interest Period for a Loan, within the time period and otherwise as
provided in this Section 4.05, it
shall be deemed to have elected to continue such Loan with an Interest Period of
one month starting on the last day of the then current Interest Period for such
Loan.

     

    4.06  [Intentionally
Omitted]

     

    
      
         

      

      
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    4.07  Non-Receipt of Funds by the
Administrative Agent.  Unless the Administrative Agent shall
have been notified by a Bank or an Obligor (the “Payor”) prior to
11:00 a.m. (London, England time) on the date on which the Payor is to make
payment to the Administrative Agent of (in the case of a Bank) the proceeds of a
Loan to be made by such Bank, or a Bank’s Commitment Percentage of (x) any
payment made by the Issuing Bank under a Letter of Credit or (y) a participation
in a Letter of Credit drawing to be acquired by such Bank, hereunder or (in the
case of an Obligor) a payment to the Administrative Agent for account of one or
more of the Banks hereunder (such payment being herein called the “Required Payment”),
which notice shall be effective upon receipt, that the Payor does not intend to
make the Required Payment to the Administrative Agent, the Administrative Agent
may assume that the Required Payment has been made and may, in reliance upon
such assumption (but shall not be required to), make the amount thereof
available to the intended recipient(s) on such date; and, if the Payor has not
in fact made the Required Payment to the Administrative Agent, the recipient(s)
of such payment shall, on demand, repay to the Administrative Agent the amount
so made available together with interest thereon in respect of each day during
the period commencing on the date (the “Advance Date”) such
amount was so made available by the Administrative Agent until the date the
Administrative Agent recovers such amount if such amount relates to a Loan, at a
rate per annum equal to the Eurodollar Rate (for one-month Eurodollar Loans) in
an amount equal to the amount of such required payment (as in effect from time
to time) plus
the Applicable Margin plus Mandatory Costs,
if any, and, if such recipient(s) shall fail promptly to make such payment, the
Administrative Agent shall be entitled to recover such amount, on demand, from
the Payor, together with interest as aforesaid; provided that if
neither the recipient(s) nor the Payor shall return the Required Payment to the
Administrative Agent within three Business Days of the Advance Date, then,
retroactively to the Advance Date, the Payor and the recipient(s) shall each be
obligated to pay interest on the Required Payment as follows:

     

    (i)           if
the Required Payment shall represent a payment to be made by the Borrower to a
Bank, the Borrower and such Bank shall each be obligated retroactively to the
Advance Date to pay interest in respect of the Required Payment at the
Post-Default Rate (and, in case the Bank shall return the Required Payment to
the Administrative Agent, without limiting the obligation of the Borrower, if
applicable, under Section 3.03 hereof
to pay interest to such recipient(s) at the Post-Default Rate in respect of the
Required Payment) and

     

    (ii)           if
the Required Payment shall represent a payment to be made by a Bank to the
Borrower, such Bank and the Borrower shall each be obligated retroactively to
the Advance Date to pay interest in respect of the Required Payment at the
Post-Default Rate (and, in case the Borrower shall return the Required Payment
to the Administrative Agent, without limiting any claim the Borrower may have
against the Payor in respect of the Required Payment);

     

    provided that the
Administrative Agent shall only be entitled to retain interest in respect of a
Required Payment pursuant to clause (i) or (ii) above from either the Payor or
the recipient.

     

    4.08  Sharing of Payments,
etc.  (a) Each of the Obligors agrees that, in addition to (and
without limitation of) any right of set-off, banker’s lien or counterclaim a
Bank may otherwise have, each Bank shall be entitled, at its option, to offset
balances held by it for account of such Obligor at any of its offices, in US
Dollars or in any other currency against any principal of or interest on any of
such Bank’s Loans, Reimbursement Obligations or any other amount payable to such
Bank hereunder, that is not paid when due (regardless of whether such balances
are then due to such Obligor), in which case it shall promptly notify such
Obligor (through the Borrower) and the Administrative Agent thereof; provided that such
Bank’s failure to give such notice shall not affect the validity
thereof.

     

    
      
        
        

      

      
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    (b)           If
any Bank shall obtain from any Obligor payment of any principal of or interest
on any Loan or Letter of Credit Liability owing to it or payment of any other
amount under this Agreement or any other Loan Document through the exercise of
any right of set-off, banker’s lien or counterclaim or similar right or
otherwise (other than from the Administrative Agent as provided herein), and, as
a result of such payment, such Bank shall have received a greater percentage of
the principal of or interest on the Loans, Letter of Credit Liabilities or such
other amounts then due hereunder or thereunder by such Obligor to such Bank than
the percentage received by any other Bank, it shall promptly purchase from such
other Banks participations in (or, if and to the extent specified by such Bank,
direct interests in) the Loans, Letter of Credit Liabilities or such other
amounts, respectively, owing to such other Banks (or in interest due thereon, as
the case may be) in such amounts, and make such other adjustments from time to
time as shall be equitable, to the end that all the Banks shall share the
benefit of such excess payment (net of any expenses that may be incurred by such
Bank in obtaining or preserving such excess payment) pro
rata in accordance with the unpaid principal of and/or interest on the
Loans, Letter of Credit Liabilities or such other amounts, respectively, owing
to each of the Banks; provided that if at
the time of such payment the outstanding principal amount of the Loans shall not
be held by the Banks pro
rata in accordance with their respective Commitments in effect at the
time such Loans were made (whether by reason of a failure of a Bank to make a
Loan hereunder in the circumstances described in the second paragraph of Section 12.04 hereof
or otherwise), then such purchases of participations and/or direct interests
shall be made in such manner as shall result, as nearly as is practicable, in
the outstanding principal amount of the Loans being held by the Banks pro
rata according to the amounts of such Commitments.  To such end
all the Banks shall make appropriate adjustments among themselves (by the resale
of participations sold or otherwise) if such payment is rescinded or must
otherwise be restored.

     

    (c)           The
Obligors agree that any Bank so purchasing such a participation (or direct
interest) may exercise all rights of set-off, banker’s lien, counterclaim or
similar rights with respect to such participation as fully as if such Bank were
a direct holder of Loans or other amounts (as the case may be) owing to such
Bank in the amount of such participation.

     

    (d)           Nothing
contained herein shall require any Bank to exercise any such right or shall
affect the right of any Bank to exercise, and retain the benefits of exercising,
any such right with respect to any other indebtedness or obligation of any
Obligor.  If, under any applicable bankruptcy, insolvency or other
similar law, any Bank receives a secured claim in lieu of a set-off to which
this Section
4.08 applies, such Bank shall, to the extent practicable, exercise its
rights in respect of such secured claim in a manner consistent with the rights
of the Banks entitled under this Section 4.08 to share
in the benefits of any recovery on such secured claim.

     

    
      
        
        

      

      
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    4.09  Maximum Rate Permitted by
Law.  Under no circumstances shall a Bank be entitled to
receive nor shall it in fact receive a payment or partial payment of interest,
fees or other amounts under this Agreement at a rate that is prohibited by
applicable law.  Accordingly, notwithstanding anything herein or
elsewhere contained, if and to the extent that under any circumstances, the
interest received or to be received by a Bank on any amount pursuant to this
Agreement or any agreement or arrangement collateral hereto entered into in
consequence or implementation hereof would, but for this Section 4.09, be a
rate that is prohibited by applicable law, then the effective annual rate of
interest, as so determined, received or to be received by the Bank on such
amount of credit advanced shall be and be deemed to be adjusted to a rate that
is one whole percentage point less than the lowest effective annual rate of
interest that is so prohibited (the “adjusted rate”); and, if a Bank has
received a payment or partial payment which would, but for this Section 4.09, be so
prohibited then any amount or amounts so received by such Bank in excess of the
adjusted rate shall comprise and be deemed to have comprised the credit to be
applied (together with interest thereon at the adjusted rate from the date of
receipt of any such amount by such Bank to the date of its application as
hereinafter provided) to subsequent payment on accounts of interest, fees or
other amounts due to such Bank at the adjusted rate.

     

    SECTION
5.

    YIELD
PROTECTION, ETC.

     

    5.01  Additional
Costs.  (a) The Borrower shall pay directly to each Bank from
time to time, as and by way of additional interest on the Indebtedness hereunder
(to the extent such characterization as interest is permitted by applicable
law), such amounts as such Bank may reasonably determine to be necessary to
compensate such Bank for any costs that such Bank determines are attributable to
its making or maintaining of any Loans or its obligation to make any Loans
hereunder, or any reduction in any amount receivable by such Bank hereunder in
respect of any of such Loans or such obligation (such increases in costs and
reductions in amounts receivable being herein called “Additional Costs”),
resulting from any Regulatory Change after the date of this Agreement or, with
respect to any financial institution that becomes a Bank hereunder after the
date of this Agreement, after the date on which such financial institution
becomes a Bank hereunder (including any Regulatory Change after such applicable
date with retroactive effect) that:

     

    (i)           changes
the basis of taxation of any amounts payable to such Bank under this Agreement
or its Notes in respect of any of such extensions of credit (other than Excluded
Taxes); or

     

    
      
        
        

      

      
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    (ii)           imposes
or modifies any reserve, special deposit or similar requirements (other than the
Reserve Requirement utilized in the determination of the Eurodollar Rate for
such Loans) relating to any extensions of credit or other assets of, or any
deposits with or other liabilities of such Bank (including, without limitation,
any of such Loans or any deposits referred to in the definition of “Eurodollar
Rate” in Section
1.01 hereof), or any commitment of such Bank (including, without
limitation, the Commitments of such Bank hereunder); or

     

    (iii)           imposes
any other condition affecting this Agreement or its Note (or any of such
extensions of credit or liabilities) or its Commitment.

     

    If any
Bank requests compensation from the Borrower under this Section 5.01(a), the
Borrower may, by notice to such Bank (with a copy to the Administrative Agent)
suspend the obligation of such Bank thereafter to make or maintain the
Eurodollar Loans until the Regulatory Change giving rise to such request ceases
to be in effect; provided that such
suspension shall not affect the right of such Bank to receive the compensation
so requested; and provided further that
(unless the Borrower exercises its right under Section 5.07 to
require such Bank to assign and delegate all of its interests, rights and
obligations under this Agreement to an assignee that assumes those obligations)
the Borrower, at its election, may prepay all then outstanding Loans of such
Bank together with accrued interest thereon at the end of the Interest Period
applicable thereto, without repaying Loans due to the other Banks and the
Commitment Percentages of the remaining Banks shall be adjusted
accordingly.  The Administrative Agent and/or any Bank, as the case
may be, shall use its reasonable efforts (consistent with its internal legal
policy and regulatory restrictions) to mitigate any Additional
Costs.

     

    (b)           Without
limiting the effect of the provisions of paragraph (a) of this Section 5.01, in the
event that, by reason of any Regulatory Change after the date of this Agreement
or with respect to any financial institution that becomes a Bank hereunder after
the date of this Agreement, after the date on which such financial institution
becomes a Bank hereunder (including any Regulatory Change after such applicable
date with retroactive effect) any Bank either (i) incurs Additional Costs based
on or measured by the excess above a specified level of the amount of a category
of deposits or other liabilities of such Bank that includes deposits by
reference to which the Eurodollar Loans are determined as provided in this
Agreement or a category of extensions of credit or other assets of such Bank
that includes Eurodollar Loans or (ii) becomes subject to restrictions on the
amount of such a category of liabilities or assets that it may hold, then, if
such Bank so elects by notice to the Borrower (with a copy to the Administrative
Agent), the obligation of such Bank to make Loans hereunder shall be suspended
until such Regulatory Change ceases to be in effect.

     

    
      
        
        

      

      
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    (c)           Without
limiting the effect of the foregoing provisions of this Section 5.01 (but
without duplication), the Borrower shall pay directly, as and by way of
additional interest on the Indebtedness hereunder (to the extent such
characterization as interest is permitted by applicable law), to each Bank from
time to time on request such amounts as such Bank may determine, acting
reasonably, to be necessary to compensate such Bank (or, without duplication,
the bank holding company of which such Bank is a subsidiary) for (i) any costs
that it determines, acting reasonably, are attributable to the maintenance by
such Bank (or any Applicable Lending Office or such bank holding company),
pursuant to any law or regulation or any interpretation, directive or request
(whether or not having the force of law and whether or not failure to comply
therewith would be unlawful) of any court or governmental or monetary authority
(A) following any Regulatory Change after the date of this Agreement or, with
respect to any financial institution that becomes a Bank hereunder after the
date of this Agreement, after the date on which such financial institution
becomes a Bank hereunder (including any Regulatory Change after such applicable
date with retroactive effect) or (B) implementing after the date of this
Agreement or, with respect to any financial institution that becomes a Bank
hereunder after the date of this Agreement, any risk-based capital guideline or
other requirement (whether or not having the force of law and whether or not the
failure to comply therewith would be unlawful) heretofore or hereafter issued by
any government or governmental or supervisory authority implementing at the
national level the Basel Accord (including, without limitation, the Final
Risk-Based Capital Guidelines of the Board of Governors of the Federal Reserve
System (12 C.F.R. Part 208, Appendix A; 12 C.F.R. Part 225, Appendix A) and the
Final Risk-Based Capital Guidelines of the Office of the Comptroller of the
Currency (12 C.F.R. Part 3, Appendix A), such compensation to include, without
limitation, an amount equal to any reduction of the rate of return on the
Commitment or Loans of such Bank (or any Applicable Lending Office or such bank
holding company) to a level below that which such Bank (or any Applicable
Lending Office or such bank holding company) could have achieved but for such
law, regulation, interpretation, directive or request; and (ii) any reduction in
amounts payable to it hereunder (other than a reduction resulting from a higher
rate of Excluded Taxes) or any payment required to be made or return that is
foregone on or calculated with reference to any amount received or receivable by
such Bank under this Agreement as a result of a Regulatory Change after the date
of this Agreement or, with respect to any financial institution that becomes a
Bank hereunder after the date of this Agreement, after the date on which such
financial institution becomes a Bank hereunder (including any Regulatory Change
after such applicable date with retroactive effect).

     

    For
purposes of this Section 5.01(c) and
Section 5.05
hereof, “Basel
Accord” shall mean the proposals for risk-based capital framework
described by the Basel Committee on Banking Regulations and Supervisory
Practices in its paper entitled “International Convergence of Capital
Measurement and Capital Standards” dated July 1988, as amended, modified and
supplemented and in effect from time to time or any replacement
thereof.

     

    
      
        
        

      

      
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    (d)           Each
Bank shall notify the Borrower of any event occurring after the date of this
Agreement entitling such Bank to compensation under paragraph (a) or (c) of this
Section 5.01 or
Sections 5.05
and 5.06 as
promptly as practicable, but in any event within 45 days, after such Bank
obtains actual knowledge thereof; provided that (i) if
any Bank fails to give such notice within 45 days of such an event, such Bank
shall, with respect to compensation payable pursuant to this Section 5.01 or Sections 5.05 and
5.06 in respect
of any costs resulting from such event, only be entitled to payment under this
Section 5.01 or
Sections 5.05
and 5.06 for
costs incurred from and after the date 45 days prior to the date that such Bank
does give such notice and (ii) each Bank shall designate a different Applicable
Lending Office for the Loans of such Bank affected by such event if such
designation shall avoid the need for, or reduce the amount of, such compensation
and shall not, in the sole opinion of such Bank, be disadvantageous to such
Bank.  Each Bank shall furnish to the Borrower a certificate setting
forth the basis and amount of each request by such Bank for compensation under
paragraph (a) or (c) of this Section 5.01 or Section 5.05 or 5.06.  Determinations
and allocations by any Bank for purposes of this Section 5.01 of the
effect of any Regulatory Change pursuant to paragraph (a) or (b) of this Section 5.01, or of
the effect of capital maintained pursuant to paragraph (c) of this Section 5.01, on its
costs or rate of return of maintaining Loans or its obligation to make Loans, or
on amounts receivable by it in respect of Loans, and of the amounts required to
compensate such Bank under this Section 5.01, shall
be conclusive in the absence of manifest error; provided that each
Bank shall, to the extent contractually permitted, treat the Borrower in a
manner consistent with other similarly situated borrowers of such
Bank.

     

    5.02  Limitation on Types of
Loans.  Anything herein to the contrary notwithstanding, if, on
or prior to the determination of the Eurodollar Rate for any Interest
Period:

     

    (i)           the
Administrative Agent determines, which determination shall be conclusive, that
quotations of interest rates for the relevant deposits referred to in the
definition of “Eurodollar Rate” in Section 1.01 hereof
are not being provided in the relevant amounts or for the relevant maturities
for purposes of determining rates of interest for Loans as provided herein;
or

     

    (ii)           the
Majority Banks determine, acting reasonably, which determination shall be
conclusive, and notify the Administrative Agent that the relevant rates of
interest referred to in the definition of “Eurodollar Rate” in Section 1.01 hereof
upon the basis of which the rate of interest for Loans for such Interest Period
is to be determined are not likely to be adequate to cover the cost to such
Banks of making or maintaining Loans for such Interest Period;

     

    then the
Administrative Agent shall give the Borrower and each Bank prompt notice
thereof, and each Bank shall determine (and shall certify from time to time in a
certificate delivered by such Bank to the Administrative Agent setting forth in
reasonable detail the basis of the computation of such amount) the rate basis
reflecting the cost to such Bank of funding its Loan for such Interest Period
for so long as such condition remains in effect, and such rate basis shall be
binding upon the Borrower and shall apply in lieu of the Eurodollar Rate for
such Interest Period (such certification to be conclusive and binding on the
Borrower in the absence of manifest error); provided that the
rate basis certified by each Bank to the Administrative Agent in accordance with
this Section shall be determined by such Bank in good faith and acting
reasonably.

     

    
      
        
        

      

      
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    5.03  Illegality.  Notwithstanding
any other provision of this Agreement, in the event that it becomes unlawful for
any Bank or its Applicable Lending Office to honor its obligation to make or
maintain Loans, then such Bank shall promptly notify the Borrower thereof (with
a copy to the Administrative Agent), following which notice, (a) such Bank’s
obligation to make Loans shall be suspended until such time as such Bank may
again make and maintain Loans, (b) if mandated by applicable law, all then
outstanding Loans of such Bank shall be prepaid by the Borrower together with
accrued interest thereon on or before such date as may be mandated by applicable
law; provided
that if it is lawful for such Bank to maintain each such Loan until the end of
the Interest Period applicable thereto, then such prepayment shall instead be
made at the end of the Interest Period, in each case, without the necessity of
repaying Loans of any other Bank (and the Commitment Percentage of the remaining
Banks shall be adjusted accordingly).

     

    5.04  Compensation.  The
Borrower shall pay to the Administrative Agent for the account of each Bank,
upon the request of such Bank through the Administrative Agent, such amount or
amounts, as and by way of additional interest on the Indebtedness hereunder (to
the extent such characterization as interest is permitted by applicable law), as
shall be sufficient (in the reasonable opinion of such Bank) to compensate it
for any loss, cost or expense that such Bank determines is attributable
to:

     

    (i)           any
payment, mandatory or optional prepayment made to such Bank for any reason
(including, without limitation, the acceleration of the Loans pursuant to Section 10 hereof) on
a date other than the last day of an Interest Period for such Loan;
or

     

    (ii)           any
failure by the Borrower for any reason (including, without limitation, the
failure of any of the conditions precedent specified in Section 7 hereof to
be satisfied) to borrow or optionally prepay a Eurodollar Loan from such Bank on
the date for such borrowing specified in the relevant notice of borrowing or
prepayment given pursuant to Section 2.02 or 2.09 hereof,
respectively.

     

    A
certificate of any Bank submitted to the Borrower as to the amount necessary to
so compensate such Bank shall be conclusive evidence, absent manifest error, of
the amount due from the Borrower to such Bank.

     

    Without
limiting the effect of the preceding sentence, such compensation shall include
an amount equal to the excess, if any, of (A) the amount of interest (excluding
any Applicable Margin) that otherwise would have accrued on the principal amount
so paid, prepaid or not borrowed for the period from the date of such payment,
prepayment or failure to borrow to the last day of the then current Interest
Period for such Loan (or, in the case of a failure to borrow, the Interest
Period for such Loan that would have commenced on the date specified for such
borrowing) at the applicable rate of interest for such Loan provided for herein
over (B) the amount of interest (excluding any Applicable Margin) that otherwise
would have accrued on such principal amount at a rate per annum equal to the
interest component of the amount such Bank would have bid in the London
interbank market for Dollar deposits of leading banks in amounts comparable to
such principal amount and with maturities comparable to such period (as
reasonably determined by such Bank).

     

    
      
        
        

      

      
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    5.05  Additional Costs in Respect
of Letters of Credit.  Without limiting the obligations of the
Borrower under Section
5.01 hereof (but without duplication), if as a result of (i) any
Regulatory Change after the date of this Agreement, or with respect to financial
institution that becomes a Bank hereunder after the date of this Agreement, the
date on which such financial institution becomes a Bank hereunder (including any
Regulatory Change after such applicable date with retroactive effect) or (ii)
the implementation after the date of this Agreement, or with respect to
financial institution that becomes a Bank hereunder after the date of this
Agreement, the date on which such financial institution becomes a Bank
hereunder, of any risk-based capital guideline or other requirement heretofore
or hereafter issued by any government or governmental or supervisory authority
implementing at the national level the Basel Accord, there shall be imposed,
modified or deemed applicable any tax, reserve, special deposit, capital
adequacy or similar requirement against or with respect to or measured by
reference to Letters of Credit issued or to be issued hereunder and the result
shall be to increase the cost to the Issuing Bank of issuing (or of any Bank of
purchasing participations in) or maintaining its obligation hereunder to issue
(or purchase participations in) any Letter of Credit hereunder or reduce any
amount receivable by the Issuing Bank or any Bank hereunder in respect of any
Letter of Credit (which increases in cost, or reductions in amount receivable,
shall be the result of the Issuing Bank or such Bank’s or Banks’ reasonable
allocation of the aggregate of such increases or reductions resulting from such
event), then, upon demand by the Issuing Bank or such Bank or Banks (through the
Administrative Agent), the Borrower shall pay immediately to the Administrative
Agent for account of the Issuing Bank or such Bank or Banks, from time to time
as specified by the Issuing Bank or such Bank or Banks (through the
Administrative Agent), as and by way of additional interest on the Indebtedness
hereunder (to the extent such characterization as interest is permitted by
applicable law), such additional amounts as shall be sufficient to compensate
the Issuing Bank or such Bank or Banks (through the Administrative Agent) for
such increased costs or reductions in amount.  A statement as to such
increased costs or reductions in amount incurred by the Issuing Bank or any such
Bank or Banks, submitted by the Issuing Bank or such Bank or Banks to the
Borrower, shall be conclusive in the absence of manifest error as to the amount
thereof.  Any Bank and/or the Issuing Bank, as the case may be, shall
use reasonable efforts (consistent with its internal legal policy and regulatory
restrictions) to mitigate any additional costs pursuant to this Section
5.05.

     

    5.06  Taxes; Loans and
Reimbursement Obligations.  (a) Any and all payments by or on
account of any obligation of any Obligor to the Banks hereunder shall be made
free and clear of and without deduction or withholding for any Indemnified Taxes
or Other Taxes; provided that if any
Obligor shall be required to deduct or withhold any Indemnified Taxes or Other
Taxes from such payments to the Banks, then (i) the sum payable shall be
increased, as and by way of additional interest on the Indebtedness hereunder
(to the extent such characterization as interest is permitted by applicable
law), as necessary so that after making all required deductions or withholdings
(including deductions or withholdings applicable to additional sums payable
under this Section) the Administrative Agent, Bank or the Issuing Bank (as the
case may be) receives an amount equal to the sum it would have received had no
such deductions or withholdings been made, (ii) such Obligor shall make such
deductions or withholdings and (iii) such Obligor shall pay the full amount
deducted or withheld (including the full amount of any deduction or withholding
from any additional sums payable under this Section 5.06(a)) to
the relevant Governmental Authority in accordance with applicable
law.

     

    
      
        
        

      

      
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    (b)           In
addition, such Obligor shall pay any Other Taxes and all present or future stamp
or documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder to the Administrative Agent, any
Bank or the Issuing Bank or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement (but in all events not including any
Excluded Taxes) to the relevant Governmental Authority in accordance with
applicable law.

     

    (c)           Each
Obligor shall indemnify the Administrative Agent, each Bank and each Issuing
Bank, within twenty (20) days after written demand therefor, for the full amount
of any Indemnified Taxes or Other Taxes paid by the Administrative Agent, such
Bank or the Issuing Bank, as the case may be, on or with respect to any payment
by or on account of any obligation of any Obligor hereunder (including
Indemnified Taxes or Other Taxes imposed or asserted on or attributable to
amounts payable under this Section) and any penalties, interest and reasonable
expenses arising therefrom or with respect thereto (other than such penalties,
interest or expenses arising through the negligence or willful misconduct of the
Administrative Agent, such Bank or the Issuing Bank), whether or not such
Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted
by the relevant Governmental Authority.  A certificate as to the
amount of such payment or liability delivered to such Obligor by a Bank or an
Issuing Bank, or by the Administrative Agent on its own behalf or on behalf of a
Bank or an Issuing Bank, shall be conclusive absent manifest error.

     

    (d)           As
soon as practicable after any payment of Indemnified Taxes or Other Taxes by any
Obligor to a Governmental Authority, such Obligor shall deliver to the
Administrative Agent the original or a certified copy of a receipt issued by
such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory
to the Administrative Agent.

     

    
      
        
        

      

      
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      (e)           Any
Foreign Lender that is entitled to an exemption from or reduction of withholding
tax under the law of the jurisdiction in which an Obligor is located, or any
treaty to which such jurisdiction is a party, with respect to payments under
this Agreement shall deliver to such Obligor (with a copy to the Administrative
Agent) such properly completed and executed documentation as reasonably required
to comply with applicable law and reasonably requested by such Obligor as shall
permit such payments to be made without withholding or at a reduced rate or as
shall permit such Obligor to recover amounts on account of such
payments.  If any withholding taxes are imposed on or with respect to
any payment on or under this Agreement, as a result of which any Obligor is
required to make any additional payment to any Foreign Lender under this Section 5.06, and if
such Foreign Lender is entitled to a cash refund from the authorities that
imposed such withholding taxes which is both identifiable and quantifiable by
such Foreign Lender as being attributable to the imposition of such withholding
taxes (a “Tax
Refund”), and such Tax Refund may be obtained without increased liability
to such Foreign Lender, such Foreign Lender shall reimburse such Obligor such
amount as such Foreign Lender shall determine acting in good faith to be
attributable to the Tax Refund, together with any interest received thereon
(attributable to such additional payment) as shall leave such Foreign Lender
after the reimbursement in the same position as it would have been if the
additional payment had not been required; provided that, if any
Tax Refund reimbursed by a Foreign Lender to such Obligor is subsequently
disallowed, such Obligor shall repay such Foreign Lender such amount (together
with interest and any applicable penalty payable by such Foreign Lender to the
relevant taxing authority) promptly after receipt of notice by such Foreign
Lender of such disallowance.  Each Obligor agrees to reimburse each
such Foreign Lender for such Foreign Lender’s reasonable out-of-pocket expenses,
if any, incurred in complying with any request hereunder and agrees that all
costs incurred by such Foreign Lender in respect of this Section 5.06(e) may
be deducted from the amount of any reimbursement to such Obligor in respect of
any Tax Refund pursuant to this Section
5.06(e).

       

      (f)           Notwithstanding
any other provision of this Section 5.06 to the
contrary, the Obligors shall not be required to indemnify the Administrative
Agent, any Bank or the Issuing Bank to the extent of any withholding tax imposed
by reason of a failure of the Administrative Agent, such Bank or the Issuing
Bank, as the case may be, to comply with any certification, information,
documentation or other reporting requirement if compliance is required by
applicable law, administrative practice or an applicable treaty as a
precondition to exemption from, or reduction in the rate of deduction or
withholding of, such withholding taxes (provided that any
such certification, information, documentation or other reporting requirement
required by administrative practice is generally followed by other similarly
situated financial institutions), including, without limitation, any failure to
comply with the requirement to provide documentation in accordance with Section
5.06(e).

       

      
        
          
          

        

        
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    5.07  Replacement of
Banks.  If (i) a Bank requests compensation under Sections 5.01, 5.05 or 5.06, (ii) Section 5.03 becomes
applicable to any Bank, (iii) the Borrower is required to pay additional amounts
pursuant to Section
5.04 to a particular Bank materially in excess of amounts required to be
paid to the other Banks, or (iv) a Bank does not consent to the Borrower’s
request for any amendment pursuant to Section 12.04 (but
only if the Majority Banks have consented to such amendment), or (v) a Bank is
in default under its obligations pursuant to Section 2 hereof, the
Borrower may, at its sole expense and effort, upon notice to such Bank and the
Administrative Agent, require such Bank to assign and delegate, without recourse
(in accordance with and subject to the restrictions, including required
consents, contained in Section 12.06), all
of its interests, rights and obligations under this Agreement to an assignee
that assumes those obligations (which assignee may be another Bank); provided that (i)
such Bank receives payment from the assignee or from the Borrower of an amount
equal to the obligations owing to such Bank (to the extent of the outstanding
principal, accrued interest and fees included in those obligations), together
with any additional amounts due pursuant to Section 5.01, 5.05 or 5.06 (in the case of
all other amounts so included) and (ii) in the case of any such assignment
resulting from a claim for compensation under Section 5.01, 5.05 or 5.06, such assignment
shall result in a reduction in such compensation or payments.  A Bank
shall not be required to make any such assignment and delegation if, as a result
of a waiver by such Bank of its right under Section 5.01, 5.03, 5.05 or 5.06, as applicable,
the circumstances entitling the Borrower to require such assignment and
delegation have ceased to apply or if a Bank determines in its sole discretion,
that such transfer would result in additional costs not indemnified by the
Borrower and notifies the Borrower of such additional costs together with a
reasonably detailed description of such additional costs; provided that if the
Borrower subsequently agrees to indemnify such Bank for such costs, such Bank
shall be required to make such assignment.

     

    SECTION
6.

    GUARANTEE.

     

    6.01  Guarantee.  The
Original Guarantors and the Subsidiary Guarantors (collectively, the “Guarantors”) hereby
jointly and severally guarantee to the Secured Parties the prompt payment in
full when due (whether at stated maturity, by acceleration or otherwise) of the
principal of and interest on the Loans made by the Banks to, and the Notes held
by each Bank from, and Reimbursement Obligations in respect of Letters of Credit
of, and the Designated Hedging Obligations of, the Borrower and all other
amounts from time to time owing to the Secured Parties by the Borrower under
this Agreement, under the Notes, under each Designated Hedging Agreement and by
any Obligor under any of the other Loan Documents to which such Obligor is a
party, in each case strictly in accordance with the terms thereof (such
obligations being herein collectively called the “Guaranteed
Obligations”).  The Guarantors hereby further jointly and
severally agree that if the Borrower shall fail to pay in full when due (whether
at stated maturity, by acceleration or otherwise) any of the Guaranteed
Obligations, the Guarantors shall promptly pay the same, without any demand or
notice whatsoever, and that in the case of any extension of time of payment or
renewal of any of the Guaranteed Obligations, the same shall be promptly paid in
full when due (whether at extended maturity, by acceleration or otherwise) in
accordance with the terms of such extension or renewal.

    
      
         

      

      
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    6.02  Obligations
Unconditional.  The obligations of the Guarantors under Section 6.01 hereof
are absolute and unconditional, joint and several, irrespective of the value,
genuineness, validity, regularity or enforceability of the obligations of the
Borrower under this Agreement, the Notes, the Designated Hedging Agreements or
any other agreement or instrument referred to herein or therein, or any
substitution, release or exchange of any other guarantee of or security for any
of the Guaranteed Obligations, and, to the fullest extent permitted by
applicable law, irrespective of any other circumstance whatsoever which might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor, it being the intent of this Section 6.02 that the
obligations of the Guarantors hereunder shall be absolute and unconditional,
joint and several, under any and all circumstances.  Without limiting
the generality of the foregoing, it is agreed that the occurrence of any one or
more of the following shall not alter or impair the liability of the Guarantors
hereunder which shall remain absolute and unconditional as described
above:

     

    (i)           at
any time or from time to time, without notice to the Guarantors, the time for
any performance of or compliance with any of the Guaranteed Obligations shall be
extended, or such performance or compliance shall be waived;

     

    (ii)          any
of the acts mentioned in any of the provisions of this Agreement, the Notes, the
Designated Hedging Agreements or any other agreement or instrument referred to
herein or therein shall be done or omitted;

     

    (iii)         the
maturity of any of the Guaranteed Obligations shall be accelerated, or any of
the Guaranteed Obligations shall be modified, supplemented or amended in any
respect, or any right under this Agreement, the Notes, the Designated Hedging
Agreements or any other agreement or instrument referred to herein or therein
shall be waived or any other guarantee of any of the Guaranteed Obligations or
any security therefor shall be released or exchanged in whole or in part or
otherwise dealt with; or

     

    (iv)         any
Lien granted to, or in favor of, the Administrative Agent or any Bank as
security for any of the Guaranteed Obligations shall fail to be
perfected.

     

    Each of
the Guarantors hereby expressly waives diligence, presentment, demand of
payment, protest and all notices whatsoever, and any requirement that any
Secured Party exhaust any right, power or remedy or proceed against the Borrower
or any Guarantor under this Agreement, the Notes or any other agreement or
instrument referred to herein or therein, or against any other Person under any
other guarantee of, or security for, any of the Guaranteed
Obligations.  Each Guarantor agrees that its obligations pursuant to
this Section 6
shall not be affected by any assignment or participation entered into by any
Bank pursuant to Section 12.06
hereof.

    
      
         

      

      
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    6.03  Reinstatement.  The
obligations of the Guarantors under this Section 6 shall
automatically be reinstated if and to the extent that for any reason any payment
by or on behalf of the Borrower or any Guarantor in respect of the Guaranteed
Obligations is rescinded or must be otherwise restored by any holder of any of
the Guaranteed Obligations, whether as a result of any proceedings in bankruptcy
or reorganization or otherwise and the Guarantors jointly and severally agree
that they shall indemnify the Secured Parties on demand for all reasonable costs
and expenses (including, without limitation, fees of counsel) incurred by them
in connection with such rescission or restoration, including any such costs and
expenses incurred in defending against any claim alleging that such payment
constituted a preference, fraudulent transfer or similar payment under any
bankruptcy, insolvency or similar law.

     

    6.04  Subrogation.  Until
all Loans have been paid in full, all Letter of Credit Liabilities have been
cash collateralized or paid or discharged in full, all Commitments have been
terminated and all Designated Hedging Agreements have been terminated, each
Guarantor hereby waives all rights of subrogation or contribution, whether
arising by contract or operation of law or otherwise by reason of any payment by
it pursuant to the provisions of this Section
6.

     

    6.05  Remedies.  The
Guarantors jointly and severally agree that, as between the Guarantors and the
Banks, the obligations of the Borrower under this Agreement and the Notes may be
declared to be forthwith due and payable as provided in Section 10 hereof
(and shall be deemed to have become automatically due and payable in the
circumstances provided in said Section 10) for
purposes of Section
6.01 hereof notwithstanding any stay, injunction or other prohibition
preventing such declaration (or such obligations from becoming automatically due
and payable) as against the Borrower and that, in the event of such declaration
(or such obligations being deemed to have become automatically due and payable),
such obligations (whether or not due and payable by the Borrower) shall
forthwith become due and payable by the Guarantors for purposes of said Section
6.01.

     

    6.06  Continuing
Guarantee.  The guarantee in this Section 6 is a
continuing guarantee, and shall apply to all Guaranteed Obligations whenever
arising.

     

    6.07  Instrument for the Payment
of Money.  Each Guarantor hereby acknowledges that the
guarantee in this Section 6 constitutes
an instrument for the payment of money, and consents and agrees that any Secured
Party, at its sole option, in the event of a dispute by such Guarantor in the
payment of any moneys due hereunder, shall have the right to bring motion-action
under New York CPLR Section 3213.

     

    6.08  Rights of
Contribution.  The Guarantors hereby agree, as between
themselves, that if any Guarantor shall become an Excess Funding Guarantor (as
defined below) by reason of the payment by such Guarantor of any Guaranteed
Obligations, each other Guarantor shall, on demand of such Excess Funding
Guarantor (but subject to the next sentence), pay to such Excess Funding
Guarantor an amount equal to such Guarantor’s Pro Rata Share (as defined below
and determined, for this purpose, without reference to the Properties, debts and
liabilities of such Excess Funding Guarantor) of the Excess Payment (as defined
below) in respect of such Guaranteed Obligations.  The payment
obligation of a Guarantor to any Excess Funding Guarantor under this Section 6.08 shall be
subordinate and subject in right of payment to the prior payment in full of the
obligations of such Guarantor under the other provisions of this Section 6 and such
Excess Funding Guarantor shall not exercise any right or remedy with respect to
such excess until payment and satisfaction in full of all of such
obligations.

    
      
         

      

      
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    For
purposes of this Section 6.08, (i)
“Excess Funding
Guarantor” shall mean, in respect of any Guaranteed Obligations, a
Guarantor that has paid an amount in excess of its Pro Rata Share of such
Guaranteed Obligations, (ii) “Excess Payment” shall
mean, in respect of any Guaranteed Obligations, the amount paid by an Excess
Funding Guarantor in excess of its Pro Rata Share of such Guaranteed Obligations
and (iii) “Pro Rata
Share” shall mean, for any Guarantor, the ratio (expressed as a
percentage) of (x) the amount by which the aggregate present fair saleable value
of all Properties of such Guarantor (excluding any shares of stock of any other
Guarantor) exceeds the amount of all the debts and liabilities of such Guarantor
(including contingent, subordinated, unmatured and unliquidated liabilities, but
excluding the obligations of such Guarantor hereunder and any obligations of any
other Guarantor that have been Guaranteed by such Guarantor) to (y) the amount
by which the aggregate fair saleable value of all Properties of all of the
Guarantors exceeds the amount of all the debts and liabilities (including
contingent, subordinated, unmatured and unliquidated liabilities, but excluding
the obligations of the Guarantors hereunder and under the other Loan Documents)
of all of the Guarantors, determined as of the date enforcement of the
Guaranteed Obligations is sought.

     

    6.09  General Limitation on
Guarantee Obligations.  In any action or proceeding involving
any state corporate law, or any state or Federal bankruptcy, insolvency,
reorganization or other applicable law in the jurisdiction of organization of
any Guarantor affecting the rights of creditors generally, if the obligations of
any Guarantor under Section 6.01 hereof
would otherwise, taking into account the provisions of Section 6.08 hereof,
be held or determined to be void, invalid or unenforceable, or subordinated to
the claims of any other creditors, on account of the amount of its liability
under said Section
6.01, then, notwithstanding any other provision hereof to the contrary,
the amount of such liability shall, without any further action by such
Guarantor, any Secured Party or any other Person, be automatically limited and
reduced to the highest amount that is valid and enforceable and not subordinated
to the claims of other creditors as determined in such action or
proceeding.

     

    SECTION
7.

    CONDITIONS
PRECEDENT.

     

    7.01  Original Closing
Date.  The conditions precedent to the agreement of each Bank
and the Issuing Bank to make Loans or to participate in Letters of Credit were
satisfied on the Original Closing Date.

     

    7.02  Closing
Date.  The obligations of the Banks and the Issuing Bank under
this Agreement in respect of the initial extension of credit pursuant to any
Loan or Letter of Credit are subject to the receipt by the Administrative Agent
of the following documents and evidence, each of which shall be satisfactory in
both form and substance to the Administrative Agent:

    
      
         

      

      
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    (a)           Resolutions,
etc..  (i) Resolutions for each Obligor party to this
Agreement, the Step-Up Agreement, the Solana Security Documents and each other
Loan Document to be executed on the Closing Date, authorizing its execution,
delivery and performance of such Loan Document, (ii) the constitutional
documents of the Borrower and each other Obligor that was not an Obligor as of
the Original Closing Date, and (iii) a certificate duly executed and delivered
by an authorized officer of each Obligor, dated as of the Closing Date and
certifying the incumbency and signatures of its officers authorized to execute
such Loan Document on its behalf, and the full force and validity of the
aforesaid corporate resolutions and constitutional documents of such
Obligor.

     

    (b)           Opinions of
Counsel.  An opinion, each to be dated on or about the date of
this Agreement and in form and substance satisfactory to the Administrative
Agent and the Banks, of (i) Gómez-Pinzón Abogados, Colombian counsel to the
Administrative Agent and the Banks, (ii) Conyers Dill and Pearman, Cayman
counsel to the Administrative Agent and the Banks, (iii) Blake, Cassels &
Graydon LLP, Alberta, Canada counsel to the Obligors, (iv) Jones Day, special
New York counsel to the Administrative Agent and the Banks and (v) Snell &
Wilmer L.L.P., Utah counsel to the Obligors.

     

    (c)           Notes.  The
Notes, duly executed and delivered, in form and substance satisfactory to the
Administrative Agent and its counsel.

     

    (d)           Security
Documents.  The Solana Security Documents, duly executed and
delivered by the parties thereto, in form and substance satisfactory to the
Administrative Agent and its counsel, together with share certificates,
direction letters, acknowledgement notices, and any other documents in
connection with the liens created thereby as the Administrative Agent may
reasonably require.

     

    (e)           Step-Up
Agreement.   The Step-Up Agreement, duly executed and
delivered by the parties thereto, in form and substance satisfactory to the
Administrative Agent and its counsel.

     

    (f)          
 Offtake
Agreement.  A duly executed copy of each Offtake Agreement
listed on Schedule VI hereto.

     

    (g)           Governmental
Approvals.  Evidence satisfactory to the Administrative Agent,
acting reasonably, that all governmental and third-party consents and approvals
necessary in connection with the financing hereunder and the Loan Documents and
the other transactions contemplated hereby and thereby have been obtained
(without the imposition of any conditions not already satisfied) and are in full
force and effect; all applicable waiting periods have expired without any action
being taken by any competent authority; and no law or regulation is applicable
(in the reasonable judgment of the Administrative Agent) that restrains,
prevents or imposes materially adverse conditions upon the financing hereunder
or thereunder, or any security therefor or any of the other transactions
contemplated hereby or thereby.

    
      
         

      

      
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    (h)           Insurance
Certificates.  Certificates of insurance evidencing the
existence of all insurance required to be maintained by the Obligors pursuant to
Section 9.04
hereof and the designation of the Administrative Agent, if required by
Administrative Agent, as agent, as the loss payee thereunder or as an additional
insured, as the case may be, in respect of all insurance covering Hydrocarbon
Properties.  In addition, the Borrower shall have delivered a
certificate of a senior officer or director of the Borrower setting forth the
insurance obtained by it in accordance with the requirements set forth in Section 9.04 and
stating that such insurance is in full force and effect and that all premiums
then due and payable thereon have been paid.

     

    (i)           
Process
Agent.  Evidence satisfactory to the Administrative Agent and
the Banks that C T Corporation System shall have accepted agency for service of
process pursuant to Section 12.15
hereof.

     

    (j)         
  Schedules
and Exhibits.  Each Schedule and Exhibit to this Agreement,
which shall be in form and substance satisfactory to each Bank and the Borrower,
all acting reasonably.

     

    (k)           Event of
Default.  No Event of Default has occurred and is continuing or
is reasonably expected to occur immediately following the making of any Loans or
the issuance of any Letter of Credit.

     

    (l)         
  Know your
Customer Documentation.  The Administrative Agent and the Banks
shall have received, and be reasonably satisfied in form and substance with, all
documentation and other information required by bank regulatory authorities
under applicable “know-your-customer” and anti-money laundering rules and
regulations, including but not restricted to the USA PATRIOT Act (Title III of
Pub. L. 107-56),  the United Kingdom Proceeds of Crime Act 2002 and
the United Kingdom Money Laundering Regulations 2003 with respect to the
Borrower.

     

    (m)          Financial
Statements.  The balance sheet and income statement for the
Partnership, Solana Resources and Solana Petroleum for the relevant period
ending December 31, 2008, prepared in good faith and presenting fairly the
estimated financial position of such entities for such period.

     

    (n)           Other
Documents.  Such other documents as the Administrative Agent,
any Bank, the Issuing Bank or special New York counsel to Standard Bank Plc may
reasonably request.

     

    (o)           Payment of Outstanding
Indebtedness; Release of Liens.  The Administrative Agent shall
be satisfied that all letters of credit issued pursuant to the Solana Credit
Agreement will be duly cash collateralized, all Indebtedness of Solana Resources
and its affiliates incurred pursuant to the Solana Credit Agreement will be paid
in full and all Liens securing such Indebtedness will be released on or prior to
the Closing Date.

    
      
         

      

      
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    (p)           Fees.  The
payment by the Borrower of such fees as the Borrower shall have agreed to pay or
deliver to any Bank or the Administrative Agent in connection herewith,
including, without limitation, the structuring fee set forth in the letter
agreement made between Gran Tierra Energy Inc. and Standard Bank Plc dated as of
March 25, 2009 and the reasonable fees and expenses of Colombian, Cayman and
special New York counsel to the Administrative Agent, in connection with the
negotiation, preparation, execution and delivery of this Agreement, the Notes
and the other Loan Documents and the extensions of credit
hereunder.

     

    7.03  Effectiveness and Subsequent
Extensions of Credit.

     

    The
obligation of the Banks to make any Loans and the obligation of an Issuing Bank
to issue any Letter of Credit on or after the Closing Date is subject to the
further conditions precedent that, both immediately prior to the making of such
Loans or the issuance of such Letter of Credit and also immediately after giving
effect thereto and to the intended use thereof:  (i) no Default shall
have occurred and be continuing; (ii) the representations and warranties made by
each Obligor in Section 8 hereof and
in each of the other Loan Documents to which it is a party, shall be true and
complete in all material respects on and as of the date of the making of such
Loans or the issuance of such Letter of Credit with the same force and effect as
if made on and as of such date (or, if any such representation or warranty is
expressly stated to have been made as of a specific date, as of such specific
date); (iii) no event or events shall have occurred which alone or in the
aggregate could reasonably be expected to have a Material Adverse Effect; and
(iv) in the case of any Loan or Letter of Credit, the aggregate principal amount
of Loans and Letter of Credit Liabilities shall not exceed the Borrowing Base as
determined pursuant to Sections 1.03 and
2.10
hereof.  Each Notice of Borrowing or request for the issuance of a
Letter of Credit by the Borrower hereunder shall constitute a certification by
each Obligor to the effect set forth in the preceding sentences (both as of the
date of such notice or request and, unless the Borrower otherwise notifies the
Administrative Agent prior to the date of such borrowing or issuance, as of the
date of such borrowing or issuance).

     

    SECTION
8.

    REPRESENTATIONS
AND WARRANTIES.

     

    Each
Obligor represents and warrants to the Banks, the Issuing Bank and the
Administrative Agent that:

     

    8.01  Corporate
Existence.  Each Obligor:  (a) is a corporation,
partnership or other entity duly incorporated or formed, validly existing and in
good standing (where applicable) under the laws of the jurisdiction of its
organization or formation; (b) has all requisite corporate, partnership or other
applicable entity power, and has all material governmental licenses,
authorizations, consents and approvals necessary to own its assets and carry on
its business as now being or as proposed to be conducted; and (c) is qualified
to do business and is in good standing (where applicable) in all jurisdictions
in which the nature of the business conducted by it makes such qualification
necessary and where failure so to qualify could reasonably be expected to have a
Material Adverse Effect.  Each of the Colombian Branches has been duly
formed and validly existing as a branch of an oil service related company in
good standing (where applicable) under the laws of Colombia.

    
      
         

      

      
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    8.02  Financial
Condition.  The Borrower has heretofore furnished to the
Administrative Agent with sufficient copies for each of the Banks the audited
consolidated financial statements of the Parent as at December 31, 2008 and the
unaudited consolidated financial statements of the Parent for the three months
ended March 31, 2009.  All such financial statements fairly present
the consolidated financial condition of the Parent as at said date in accordance
with GAAP.  Neither the Borrower nor any of its Subsidiaries has on
the date of this Agreement any material contingent liabilities, liabilities for
Taxes, unusual forward or long-term commitments or unrealized or anticipated
losses from any unfavorable commitments, except as referred to or reflected or
provided for in its financial statements most recently delivered (including the
notes thereto or as otherwise disclosed to the Administrative Agent in writing
prior to the date hereof).  Except as disclosed in writing to the
Administrative Agent on or prior to the date of this Agreement (or on or prior
to the date of any subsequent affirmation or repetition of this representation
and warranty, as applicable), since March 31, 2009 there has been no material
adverse change in the consolidated financial condition, operations or business
taken as a whole of the Borrower from that set forth in said financial
statements as at said date.

     

    8.03  Litigation.  Except
as disclosed to the Administrative Agent in writing prior to the date of this
Agreement (or, prior to the date of any subsequent affirmation or repetition of
this representation and warranty, as applicable), there are no legal or arbitral
proceedings, or any proceedings by or before any Governmental Authority, now
pending or (to the knowledge of any Obligor) threatened against any Obligor
which, if adversely determined could reasonably be expected to have a Material
Adverse Effect.

     

    8.04  No
Breach.  None of the execution and delivery of this Agreement
and the Notes and the other Loan Documents to which such Obligor is a party, the
consummation of the transactions herein and therein contemplated or compliance
with the terms and provisions hereof and thereof shall conflict with or result
in a breach of, or require any consent under, the charter or by-laws or other
constitutive document of such Obligor, or any applicable law or regulation, or
any order, writ, injunction or decree of any Governmental Authority, or any
agreement or instrument to which the Borrower or any of its Restricted
Subsidiaries is a party or by which any of them or any of their Property is
bound or to which any of them is subject, or constitute a default under any such
agreement or instrument, or (except for Liens created pursuant to the Security
Documents and the other Loan Documents) result in the creation or imposition of
any Lien upon any Property of the Borrower or any of its Restricted Subsidiaries
pursuant to the terms of any such agreement or instrument, except for any such
conflict with or breach of applicable law, regulation, order, injunction or
decree of any Governmental Authority, or default under such agreement or
instrument, that would not have a Material Adverse Effect.

    
      
         

      

      
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    8.05  Action.  Each
Obligor has all necessary corporate, partnership or other applicable entity
power, capacity, authority and legal right to execute, deliver and perform its
obligations under each of the Loan Documents to which it is or is intended to be
a party; the execution, delivery and performance by each Obligor of each of the
Loan Documents to which it is or is intended to be a party have been duly
authorized by all necessary corporate, partnership or other applicable entity
action on its part (including, without limitation, any required shareholder
approvals); and this Agreement has been duly and validly executed and delivered
by each Obligor and constitutes, and each of the Notes and the other Loan
Documents to which it is a party when executed and delivered by such Obligor (in
the case of the Notes, for value) shall constitute, its legal, valid and binding
obligation, enforceable against such Obligor in accordance with its terms,
except as such enforceability may be limited by (a) bankruptcy, insolvency,
reorganization, moratorium or similar laws of general applicability affecting
the enforcement of creditors’ rights and (b) the application of general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).

     

    8.06  Approvals.  No
authorizations, approvals or consents of, and except for filings and recordings
in respect of the Liens created pursuant to the Security Documents and except
for customary 8-K filings, no filings or registrations with, any Governmental
Authority, or any securities exchange, are necessary for the execution, delivery
or performance by any Obligor of the Loan Documents to which it is a party or
for the legality, validity or enforceability hereof or thereof.

     

    8.07  Use of
Credit.  Neither the Borrower nor any of its Subsidiaries is
engaged principally, or as one of its important activities, in the business of
extending credit for the purpose, whether immediate, incidental or ultimate, of
buying or carrying margin stock (as defined in Regulations U and X of the Board
of Governors of the Federal Reserve System), and no part of the proceeds of any
extension of credit hereunder shall be used to buy or carry any such margin
stock.

     

    8.08  Taxes.  As
and when required by applicable law, the Borrower and its Subsidiaries have
filed either directly or indirectly through the Borrower all income tax returns
under applicable law required to be filed and all other material tax returns
that are required to be filed by them in any local or foreign jurisdiction and
have paid either directly or indirectly through the Borrower all Taxes due
pursuant to such returns or pursuant to any assessment received by the Borrower
or any of its Subsidiaries (other than those the amount or validity of which is
currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books of the Borrower or the applicable Subsidiaries, as the case may be),
except to the extent failure to comply therewith by an Unrestricted Subsidiary
would not have a Material Adverse Effect.  The charges, accruals and
reserves on the books of the Borrower and its Subsidiaries in respect of Taxes
and other governmental charges are, in the opinion of such Obligor,
adequate.  No Obligor has given or been requested to give a waiver of
the statute of limitations relating to the payment of federal, provincial, local
and foreign Taxes or other impositions.

    
      
         

      

      
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    8.09  Compliance with Laws and
Agreements.  Except as disclosed in writing to the
Administrative Agent on or prior to the date of this Agreement (or on or prior
to the date of any subsequent affirmation or repetition of this representation
and warranty, as applicable), each of the Borrower and its Subsidiaries is in
compliance with all laws, regulations and orders of any Governmental Authority
applicable to it or its Property and all indentures, agreements and other
instruments binding upon it or its Property, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.  No Default has occurred and is
continuing.

     

    8.10  Environmental
Matters.  (a) Each of the Borrower and its Subsidiaries has
obtained all environmental, health and safety permits, licenses and other
authorizations required under all Environmental Laws to carry on its business as
now being or as proposed to be conducted, except to the extent failure to have
any such permit, license or authorization would not have a Material Adverse
Effect.  Each of such permits, licenses and authorizations is in full
force and effect and each of the Borrower and its Subsidiaries is in compliance
with the terms and conditions thereof, and is also in compliance with all other
limitations, restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules and timetables contained in any applicable Environmental
Law or in any regulation, code, plan, order, decree, judgment, injunction,
notice or demand letter issued, entered, promulgated or approved thereunder,
except to the extent failure to comply therewith would not have a Material
Adverse Effect.

     

    (b)          No
notice, notification, demand, request for information, citation, summons or
order has been issued, no complaint has been filed, no penalty has been assessed
and no investigation or review is pending or threatened by any governmental or
other entity with respect to any alleged failure by the Borrower or any of its
Subsidiaries to have any environmental, health or safety permit, license or
other authorization required under any Environmental Law in connection with the
conduct of the business of the Borrower or any of its Subsidiaries or with
respect to any generation, treatment, storage, recycling, transportation,
discharge or disposal, or any Release of any Hazardous Materials generated by
the Borrower or any of its Subsidiaries and which in any case could reasonably
be expected to have a Material Adverse Effect.

     

    (c)          Except
as set forth on Schedule V (or, after the date of this Agreement, as disclosed
to the Administrative Agent in writing):

     

    (i)           neither
the Borrower nor any of its Restricted Subsidiaries owns or operates a
treatment, storage or disposal facility requiring a permit under any foreign or
local statute that has not already been obtained where the failure to obtain
such permit could reasonably be expected to have a Material Adverse
Effect;

    
      
         

      

      
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    (ii)          to
the knowledge of the Borrower and its Subsidiaries after due inquiry in
accordance with standard hydrocarbon industry practice, no polychlorinated
biphenyls (PCB’s) are or have been present at any site or facility now or
previously owned, operated or leased by the Borrower or any of its Subsidiaries
that could reasonably be expected to have a Material Adverse
Effect;

     

    (iii)         to
the knowledge of the Borrower and its Subsidiaries after due inquiry in
accordance with standard hydrocarbon industry practice, no asbestos or
asbestos-containing materials is or has been present at any site or facility now
or previously owned, operated or leased by the Borrower or any of its
Subsidiaries that could reasonably be expected to have a Material Adverse
Effect;

     

    (iv)         to
the knowledge of the Borrower and its Subsidiaries after due inquiry in
accordance with standard hydrocarbon industry practice, there are no underground
storage tanks or surface impoundments for Hazardous Materials, active or
abandoned, at any site or facility now or previously owned, operated or leased
by the Borrower or any of its Subsidiaries which could reasonably be expected to
have a Material Adverse Effect (provided that all
such tanks or impoundments which could not reasonably be expected to have a
Material Adverse Effect have been set forth on Schedule V or, if acquired after
the date of this Agreement, have been disclosed to the Administrative Agent in
writing);

     

    (v)          to
the knowledge of the Borrower and its Subsidiaries after due inquiry in
accordance with standard hydrocarbon industry practice, no Hazardous Materials
have been Released at, on or under any site or facility now or previously owned,
operated or leased by the Borrower or any of its Subsidiaries in a reportable
quantity established by statute, ordinance, rule, regulation or order which
could reasonably be expected to have a Material Adverse Effect (provided that all
such Releases which could not reasonably be expected to have a Material Adverse
Effect have been set forth on Schedule V or, if such Release occurs after the
date of this Agreement, have been disclosed to the Administrative Agent in
writing); and

     

    (vi)         to
the knowledge of the Borrower and its Subsidiaries after due inquiry in
accordance with standard hydrocarbon industry practice, no Hazardous Materials
have been otherwise Released at, on or under any site or facility now or
previously owned, operated or leased by the Borrower or any of its Subsidiaries
that would have a Material Adverse Effect.

     

    (d)          No
oral or written notification of a Release of a Hazardous Material has been filed
by or on behalf of the Borrower or any of its Restricted Subsidiaries and no
site or facility now or, to the knowledge of the Borrower, previously owned or
operated by the Borrower or any of its Restricted Subsidiaries is listed or
proposed by any Governmental Authority as a site requiring investigation or
clean-up and which in any case could reasonably be expected to have a Material
Adverse Effect.

    
      
         

      

      
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    (e)           As
of the date of this Agreement, no Liens have arisen and remain outstanding under
or pursuant to any Environmental Laws on any site or facility owned or operated
by the Borrower or any of its Restricted Subsidiaries, and no government action
has been taken or is in process that could subject any such site or facility to
Liens under or pursuant to any Environmental Laws and neither the Borrower nor
any of its Restricted Subsidiaries would be required to place any notice or
restriction relating to the presence of Hazardous Materials at any site or
facility owned by it in any deed to the real property on which such site or
facility is located.  Upon each subsequent affirmation or repetition
of this representation and warranty, no Liens have arisen and remain outstanding
under or pursuant to any Environmental Laws on any site or facility owned or
operated by the Borrower or any of its Restricted Subsidiaries that could
reasonably be expected to result in a Material Adverse Effect, and no government
action has been taken or is in process that could subject any such site or
facility to Liens under or pursuant to any Environmental Laws which could
reasonably be expected to result in a Material Adverse Effect and neither the
Borrower nor any of its Restricted Subsidiaries would be required to place any
notice or restriction relating to the presence of Hazardous Materials at any
site or facility owned by it in any deed to the real property on which such site
or facility is located.

     

    (f)           There
have been no environmental investigations, studies, audits, tests, reviews or
other analyses conducted by or that are in the possession of the Borrower or any
of its Restricted Subsidiaries in relation to any site or facility now or
previously owned, operated or leased by the Borrower or any of its Restricted
Subsidiaries which have not been made available to the Banks that indicate any
fact or condition that would reasonably be expected to have a Material Adverse
Effect.

     

    8.11  Subsidiaries,
etc.  (a) With respect to representations under this Section 8.11(a) made
or deemed made after the date of this Agreement, set forth in the most recently
updated Schedule III delivered by the Borrower to the Administrative Agent from
time to time is a true and complete list of all of the Subsidiaries of the
Borrower, together with, for each such Subsidiary, (i) the jurisdiction of
organization of such Subsidiary, (ii) each Person holding ownership interests in
such Subsidiary, (iii) the nature of the ownership interests held by each such
Person and the percentage of ownership of such Subsidiary represented by such
ownership interests and (iv) indicating whether each such Subsidiary is a
Restricted Subsidiary or an Unrestricted Subsidiary.  Except as
disclosed in Schedule III hereto, (x) each holder of ownership interests in such
Subsidiary owns, free and clear of Liens (other than Liens created pursuant to
the Security Documents), and has the unencumbered right to vote, all outstanding
ownership interests in each Person shown to be held by it in Schedule III
hereto, (y) all of the issued and outstanding capital stock of each such Person
organized as a corporation is validly issued, fully paid and nonassessable and
(z) there are no outstanding Equity Rights with respect to such Person which are
not disclosed in Schedule III hereto.

     

    
      
        
        

      

      
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    (b)           None
of the Restricted Subsidiaries of the Borrower is, on the date of this
Agreement, subject to any indenture, agreement, instrument or other arrangement
of the type described in the last sentence of Section 9.15
hereof.

     

    8.12  True and Complete
Disclosure.  The information (other than projections), reports,
financial statements, exhibits, disclosure letters and schedules furnished in
writing to the Administrative Agent, an Issuing Bank or any Bank in connection
with the negotiation, preparation or delivery of this Agreement and the other
Loan Documents or included herein or therein or delivered pursuant hereto or
thereto and prepared by or on behalf of the Obligors (or, when prepared by any
other Person, to the knowledge of the Borrower) when taken as a whole do not
contain any untrue statement of material fact or omit to state any material fact
necessary to make the statements herein or therein, in light of the
circumstances under which they were made, not misleading.  All written
information (other than projections) furnished after the date of this Agreement
by the Obligors to the Administrative Agent, the Issuing Bank or the Banks in
connection with this Agreement and the other Loan Documents and the transactions
contemplated hereby and thereby when prepared by or on behalf of the Obligors
shall be, (or, when prepared by any other person to the knowledge of the
Borrower shall be) true, complete and accurate in every material respect on the
date as of which such information is stated or certified; and all projections
delivered to the Administrative Agent and the Banks were based on assumptions
believed in good faith to be reasonable at the time such projections were made
(it being understood that no assurance can be given that any such assumption
will be realized).  As of the date hereof, there is no fact known to
any Obligor that could reasonably be expected to have a Material Adverse Effect
that has not been disclosed herein, in the other Loan Documents or in a report,
financial statement, exhibit, schedule, disclosure letter or other writing
furnished to the Banks for use in connection with the transactions contemplated
hereby or thereby.

     

    8.13  Title to
Properties.  The Borrower and each of its Restricted
Subsidiaries has good and indefeasible title to the Properties shown to be owned
by it on its most recent financial statements, free and clear of all Liens
(other than Permitted Liens), except for minor title defects that would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect; provided that other
than in respect to of Permitted Liens, no such title defects exists with respect
to the Hydrocarbon Properties.

     

    8.14  Capitalization.  Schedule
IV sets forth as of the date of this Agreement (or, with respect to
representations under this Section 8.14 made or
deemed made after the date of this Agreement, set forth in the most recently
updated Schedule IV delivered by the Borrower to the Administrative Agent sets
forth as of such date) the authorized capital stock of each Restricted
Subsidiary and the amount of such capital stock issued and outstanding
(including currently outstanding warrants and stock options).

     

    
      
        
        

      

      
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    8.15  Insurance.  The
Borrower and its Subsidiaries maintain insurance with financially sound and
reputable third party insurers of a character usually maintained by Persons
engaged in the same or similar businesses, against loss, damage and liability of
the kinds and in the amounts customarily maintained by such
Persons.  All such insurance is in full force and effect and all
premiums due and payable on such insurance has been paid.

     

    8.16  ERISA.  Neither
the Borrower nor any other Obligor or Restricted Subsidiary maintains any
employee pension benefit plan which is subject to the provisions of Title IV of
ERISA.

     

    SECTION
9.

    COVENANTS
OF THE OBLIGORS.

     

    Each
Obligor covenants and agrees with the Banks, the Issuing Bank and the
Administrative Agent that, so long as any Commitment, Loan or Letter of Credit
Liability is outstanding and until payment in full of all amounts payable by the
Borrower hereunder:

     

    9.01  Financial Statements,
Etc.  The Borrower shall (for itself and on behalf of each of
the other Obligors) deliver to the Administrative Agent (with sufficient copies
for each Bank):

     

    (a)           as
soon as available and in any event within 60 days after the end of each
quarterly fiscal period of each fiscal year of the Borrower (other than the last
quarterly fiscal period of each fiscal year of the Borrower), consolidated and
consolidating statements of income, retained earnings and cash flow of the
Borrower for such period and for the period from the beginning of the respective
fiscal year to the end of such period, and the related consolidated and
consolidating balance sheets of the Borrower as at the end of such period,
setting forth in each case in comparative form the corresponding consolidated
and consolidating figures for the corresponding period in the preceding fiscal
year, accompanied by (i) a certificate of a senior officer or director of the
Borrower, which certificate shall state that said consolidated financial
statements fairly present the consolidated financial condition and results of
operations of the Borrower, and said consolidating financial statements
reconcile to the consolidated financial statements of the Borrower, and that
such consolidated financial statements have been prepared in accordance with
GAAP, as at the end of, and for, such period (subject to normal year-end audit
adjustments), and (ii) a certificate of a senior officer or director of the
Borrower setting forth the valuation of Indebtedness included in clause (c) of
the definition of Indebtedness, if any; provided that so long
as the Borrower’s annual financial statements are not audited and the Parent’s
annual financial statements are audited, all references to “Borrower” in this
Section 9.01(a) shall be deemed to refer to the Parent instead of the
Borrower;

     

    
      
        
        

      

      
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    (b)           as
soon as available and in any event within 105 days after the end of each fiscal
year of the Borrower, consolidated and consolidating statements of income,
retained earnings and cash flow of the Borrower for such fiscal year and the
related consolidated and consolidating balance sheets of the Borrower as at the
end of such fiscal year, setting forth in each case in comparative form the
corresponding consolidated and consolidating figures for the preceding fiscal
year, and accompanied (i) in the case of said consolidated statements and
balance sheet of the Borrower, by an opinion thereon of independent certified
public accountants of recognized international standing, which opinion shall
state that said consolidated financial statements fairly present the
consolidated financial position and results of operations of the Borrower as at
the end of, and for, such fiscal year in accordance with GAAP and (ii) in the
case of said consolidating statements and balance sheet, by a certificate of a
senior officer or director of the Borrower, which certificate shall state that
said consolidating financial statements reconcile to the consolidated financial
statements of the Borrower, and that such consolidating financial statements
have been prepared in accordance with GAAP, as at the end of, and for, such
fiscal year; provided that so long
as the Borrower’s annual financial statements are not audited and the Parent’s
annual financial statements are audited, all references to “Borrower” in this
Section 9.01(b) shall be deemed to refer to the Parent instead of the
Borrower;

     

    (c)           promptly
upon their filing, copies of all registration statements, regular periodic
reports and any other statements or reports (including material change reports),
if any, which the Borrower shall have filed with any securities exchange or
securities regulatory authority;

     

    (d)           promptly
upon the mailing thereof to the public shareholders of the Borrower, copies of
all financial statements, reports and proxy statements so mailed (other than any
such statements or reports delivered pursuant to clause (c) above);

     

    (e)           on
or before each Report Delivery Date, the applicable Reserve Evaluation
Report;

     

    (f)           promptly
after the Borrower or any of its Restricted Subsidiaries knows or has reason to
believe that any Default has occurred, a notice of such Default describing the
same in reasonable detail and, together with such notice or as soon thereafter
as possible, a description of the action that the Borrower or any of its
Restricted Subsidiaries has taken or proposes to take with respect
thereto;

     

    (g)           within
30 days after the end of each fiscal quarter, a report prepared by or on behalf
of the Borrower detailing production of Hydrocarbons by the Borrower and its
Restricted Subsidiaries during such fiscal quarter, including gross production,
and net production after royalties of the Borrower and its Restricted
Subsidiaries and such other related information as the Administrative Agent may
reasonably request;

     

    
      
        
        

      

      
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    (h)           within
30 days after the end of each fiscal year of the Borrower, a report prepared by
or on behalf of the Borrower detailing (i) the projected production of
Hydrocarbons by the Borrower and its Restricted Subsidiaries in each of the next
four fiscal quarters and the assumptions used in calculating such projections,
and (ii) the projected Capital Expenditures to be incurred by the Borrower and
its Restricted Subsidiaries in each of the next four fiscal quarters, with a
breakdown of those Capital Expenditures to be used for the development of proved
undeveloped reserves in Colombian Hydrocarbon Properties, and the assumptions
used in calculating such projections;

     

    (i)           within
30 days after the end of each fiscal year of the Borrower, copies of all
insurance policies maintained by the Borrower and its Restricted Subsidiaries,
and within ten (10) Business Days of the renewal of any such insurance policy, a
copy of the renewal schedule in respect of such insurance policy;

     

    (j)           no
later than 30 days before the end of each fiscal year of the Borrower, an annual
operating budget for the Borrower and its Restricted Subsidiaries for the
forthcoming fiscal year; and

     

    (k)           from
time to time such other information regarding the financial condition,
operations, business, or Properties of the Borrower or any of its Subsidiaries
as any Bank or the Administrative Agent may reasonably request.

     

    The
Borrower shall furnish to the Administrative Agent, at the time it furnishes
each set of financial statements pursuant to paragraph (a) or (b) above, a
certificate of a senior officer or director of the Borrower (i) to the effect
that no Default has occurred and is continuing (or, if any Default has occurred
and is continuing, describing the same in reasonable detail and describing the
action that the Borrower has taken or proposes to take with respect thereto),
and (ii) setting forth in reasonable detail the computations necessary to
determine whether the Borrower is in compliance with Sections 9.08(g),
9.10 and 9.16 hereof as of the
end of the respective quarterly fiscal period or fiscal year, which computations
in respect of Sections
9.10 and 9.16 shall be in
accordance with GAAP.  The Borrower shall be entitled to use
electronic mail to furnish to the Administrative Agent the financial statements,
reports, certificates and other documents to be delivered pursuant to this Section 9.01; provided that, if
requested by the Administrative Agent at any time, the Borrower shall promptly
deliver to the Administrative Agent a paper copy of such financial statement,
report, certificate or other document.

     

    9.02  Litigation.  The
Borrower shall promptly give to the Administrative Agent notice of all legal or
arbitral proceedings, and of all proceedings by or before any Governmental
Agency, and any material development in respect of such legal or other
proceedings, affecting the Borrower or any of its Subsidiaries, except
proceedings which, if adversely determined, would not have a Material Adverse
Effect.  Without limiting the generality of the foregoing, the
Borrower shall give to the Administrative Agent  notice of the
assertion of any Environmental Claim by any Person against, or with respect to
the activities of, the Borrower or any of its Restricted Subsidiaries and notice
of any alleged violation of or non-compliance with any Environmental Laws or any
permits, licenses or authorizations, other than any Environmental Claim or
alleged violation which, if adversely determined, would not have a Material
Adverse Effect.

     

    
      
        
        

      

      
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    9.03  Existence,
Etc.  The Borrower shall, and shall cause each of its
Restricted Subsidiaries to:

     

    (a)           preserve
and maintain its legal existence and all of its material rights, privileges,
licenses and franchises (provided that nothing
in this Section
9.03 shall prohibit any transaction expressly permitted under Section 9.05
hereof);

     

    (b)           comply
with the requirements of all applicable laws, rules, regulations and orders of
Governmental Authorities (including Environmental Laws and, if applicable to the
Borrower or any of its Restricted Subsidiaries at any time hereafter, the
Employee Retirement Income Security Act of 1974 (“ERISA”)) if failure
to comply with such requirements could reasonably be expected to have a Material
Adverse Effect;

     

    (c)           pay
and discharge all Taxes imposed on it or on its income or profits or on any of
its Properties prior to the date on which penalties attach thereto, except those
that are being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been established by the
applicable Obligor;

     

    (d)           pay
and discharge all trade debt and royalties when due and payable, except those
that are being contested in good faith and by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been established by the
applicable Obligor;

     

    (e)           maintain
or cause the maintenance all of its Properties used or useful in its business in
good working order and condition and in compliance with applicable laws and
insurance requirements (ordinary wear and tear excepted) and maintain and
operate (or to the extent that the Borrower or one of its Restricted
Subsidiaries is not the operator of any Hydrocarbon Properties, use its
reasonable commercial efforts to cause the operator thereof to do so) its
Hydrocarbon Properties in accordance with prudent industry standards (provided that nothing
in this Section
9.03 shall prohibit any transaction permitted by Sections 9.05, 9.06, 9.08 and 9.09);

     

    (f)           keep
adequate records and books of account, in which complete entries shall be made
in accordance with GAAP; and

     

    (g)           promptly
obtain from time to time at its own expense and at all times maintain in full
force and effect without any material modification or amendment, all such
governmental licenses, authorizations, registrations, consents, permits and
approvals as may be required for the Borrower or its Restricted Subsidiaries to
(a) comply with its obligations, and preserve its rights under, each of the Loan
Documents and (b) maintain the existence, priority and perfection of the Liens
purported to be created under the Security Documents.

     

    
      
        
        

      

      
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    9.04  Insurance.  The
Borrower shall, and shall cause each of its Restricted Subsidiaries (including
without limitation the Subsidiary Guarantors) to, keep insured by financially
sound and reputable insurers all Property of a character customarily insured by
Persons engaged in the same or similar businesses similarly situated against
loss or damage of the kinds and in the amounts customarily insured against by
such Persons and carry such other insurance as is customarily carried by such
Persons or as is required by applicable law.

     

    9.05  Prohibition of Fundamental
Changes; Disposition of Assets.  The Borrower shall not, nor
shall it permit any of its Restricted Subsidiaries to, enter into any
transaction of merger or consolidation or amalgamation, or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution).  The
Borrower shall ensure that the GP remains the general partner of the
Partnership, and the Borrower shall continue to own, directly or indirectly, all
of the limited liability company series interests described as “series 1”,
“series 2”, and “series 3” in the limited liability company agreement of GTE
Colombia Holdings, LLC, a Delaware limited liability company, and such series
interests taken together with the limited liability company series interests
described as “series 4”, “series 5”, “series 6”, “series 7”, “series 8” and
“series 9” in the limited liability company agreement of GTE Colombia Holdings,
LLC, a Delaware limited liability company, shall continue to collectively own,
directly or indirectly, all of the Voting Stock of each of the GP and the
Partnership.  The Borrower shall not, nor shall it permit any of its
Restricted Subsidiaries to, acquire any business or Property (other than
Hydrocarbon Properties and related assets) from, or Capital Stock (other than
the Capital Stock of Persons engaged in the acquisition and exploitation of, or
the exploration for or development or production of, Hydrocarbon reserves and
activities reasonably related thereto) of, or be a party to any acquisition of,
any Person except for purchases of inventory and other Property to be sold or
used in the ordinary course of business and Investments permitted under Section 9.08
hereof.  The Borrower shall not, and shall not permit any of its
Restricted Subsidiaries to, convey, sell, lease, transfer or otherwise dispose
of, in one transaction or a series of transactions, any part of its business or
Property (if any such conveyance, sale, lease, transfer or disposal would result
in a Borrowing Base Deficiency, including by way of disposition of the Capital
Stock of a Restricted Subsidiary), whether now owned or hereafter acquired
including, without limitation, receivables and leasehold interests, but
excluding, and without duplication, (i) obsolete or worn-out Property, tools or
equipment no longer used or useful in its business so long as the amount thereof
sold in any single fiscal year by the Borrower and its Restricted Subsidiaries
shall not have an aggregate fair market value in excess of $3,000,000 (or its
equivalent in other currencies), (ii) any Hydrocarbons produced or sold in the
ordinary course of business and on ordinary business terms excluding any sale or
lease of interests in Hydrocarbons in the ground, (iii) on and after the date of
this Agreement, any other Properties of the Borrower and its Restricted
Subsidiaries (other than Unrestricted Properties), including any such
disposition by way of disposition of the Capital Stock of any Restricted
Subsidiary; provided that the
aggregate fair market value of such other Properties (including such Capital
Stock) conveyed, sold, leased, transferred or otherwise disposed of on or after
the date of this Agreement shall not exceed $2,000,000 (or its equivalent in
other currencies) during any Determination Period; and provided further that
such conveyance, sale, lease, transfer or other disposition shall not include
any accounts receivable or inventory of the Borrower or any of its Restricted
Subsidiaries other than such accounts, receivable or inventory, (x) incidental
to the sale of Hydrocarbon Properties and (y) created or produced from such
Hydrocarbon Properties on or after the effective date of any such conveyance,
sale, lease, transfer or other disposition of such Hydrocarbon Properties, (iv)
the expiration of leases covering Hydrocarbon Properties, (v) Unrestricted
Properties, (vi) sales or dispositions of Hydrocarbon Properties (and related
tangibles) resulting from any pooling or unitization entered into in the
ordinary course of business when, in the reasonable judgment of the Borrower, it
is necessary to do so in order to facilitate the orderly exploration,
development or operation of such Hydrocarbon Properties, (vii) Dispositions of
any business or Property from one Obligor to another, (viii) Dispositions
permitted by Section
9.06, and (ix) the sale of the Capital Stock of Unrestricted
Subsidiaries.  Notwithstanding the foregoing provisions of this Section
9.05:

     

    
      
        
        

      

      
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    (a)           any
Restricted Subsidiary of the Borrower may be amalgamated, merged or consolidated
with or into:  (i) the Borrower if the Borrower shall be the
continuing or surviving corporation or (ii) any other such Restricted
Subsidiary; provided that (A)
that if any such transaction shall be between a Subsidiary Guarantor and a
Restricted Subsidiary not a Subsidiary Guarantor, and such Subsidiary Guarantor
is not the resulting, continuing or surviving entity, then the resulting,
continuing or surviving entity shall have assumed all of the obligations of such
Subsidiary Guarantor hereunder and (B) the resulting, continuing or surviving
Restricted Subsidiary shall either be organized in (1) the same jurisdiction as
the Restricted Subsidiary that is not the surviving Subsidiary, (2) the same
jurisdiction as the surviving Subsidiary if the assets of the non-surviving
Subsidiary have a de minimis
value or derive substantially all of their value from the jurisdiction in
which the surviving Subsidiary is organized, (3) any state of the United States
of America or province of Canada, or (4) such other jurisdiction as approved by
the Majority Banks, acting reasonably;

     

    (b)           any
Restricted Subsidiary of the Borrower may sell, lease, transfer or otherwise
dispose of any or all of its Property (upon voluntary liquidation or otherwise)
to the Borrower or a Wholly Owned Subsidiary of the Borrower which is a
Restricted Subsidiary; provided that (i) if
any such sale is by a Subsidiary Guarantor to a Restricted Subsidiary of the
Borrower not a Subsidiary Guarantor, then such Restricted Subsidiary shall have
assumed all of the obligations of such Subsidiary Guarantor hereunder and (ii)
such Wholly Owned Subsidiary that is buying, leasing or otherwise acquiring such
Property is incorporated in (A) the same jurisdiction as the selling, leasing,
transferring or disposing Restricted Subsidiary, (B) the same jurisdiction as
the Wholly Owned Subsidiary if the assets of the disposing Restricted Subsidiary
have a de minimis value
or derive substantially all of their value from the jurisdiction in which the
Wholly Owned Subsidiary is organized, (C) any state of the United States of
America or province of Canada, or (D) such other jurisdiction as approved by the
Majority Banks, acting reasonably; and

     

    
      
        
        

      

      
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    (c)           the
Borrower or any Restricted Subsidiary of the Borrower may merge or consolidate
with any other Person if (i) in the case of a merger or consolidation of the
Borrower, the Borrower is the surviving corporation and, in any other case, the
surviving corporation is a Wholly Owned Subsidiary of the Borrower which is a
Restricted Subsidiary and (ii) after giving effect thereto no Default would
exist hereunder.

     

    9.06  Limitation on
Liens.  The Borrower shall not, nor shall it permit any of its
Restricted Subsidiaries to, create, incur, assume or suffer to exist any Lien
upon any of their Property, whether now owned or hereafter acquired,
except:

     

    (a)           Liens
created pursuant to the Security Documents;

     

    (b)           Liens
in existence on the date of this Agreement and listed on Schedule II
hereto;

     

    (c)           Liens
imposed by any Governmental Authority for taxes, assessments, charges or levies
not yet due or which are being contested in good faith and by appropriate
proceedings if, unless the amount thereof is not material with respect to it or
its financial condition, adequate reserves with respect thereto are maintained
on the books of the Borrower or the affected Subsidiaries, as the case may be,
in accordance with GAAP;

     

    (d)           Liens,
privileges or charges imposed by law, such as statutory liens and deemed trusts,
workers’ compensation, unemployment insurance, pension and employment law
carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like
Liens arising in the ordinary course of business which are not overdue for a
period of more than 45 days or which are being contested in good faith and by
appropriate proceedings and Liens securing judgments (but only to the extent,
for an amount and for a period not resulting in an Event of Default under Section 10(h)
hereof);

     

    (e)           pledges
or deposits under worker’s compensation, unemployment insurance and other social
security or similar legislation;

     

    (f)           (i)
deposits to secure the performance of bids, trade contracts (other than for
borrowed money), leases, statutory obligations, surety, stay, appeal and
indemnity bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business, and (ii) Liens to secure
Indebtedness permitted pursuant to Section 9.07(e) in an
amount not to exceed $2,000,000; provided that, for
the avoidance of doubt, nothing in this clause (f) shall be construed to permit
the making of any deposit to secure an Obligor’s obligations under any Hedging
Agreement (other than a Designated Hedging Agreement);

     

    
      
        
        

      

      
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      (g)           easements,
rights-of-way, restrictions and other similar encumbrances incurred in the
ordinary course of business and encumbrances consisting of zoning restrictions,
easements, licenses, restrictions on the use of Property, or minor imperfections
in title thereto which, in the aggregate, are not material in amount, and which
do not in any case materially detract from the value of the Property subject
thereto or interfere with the ordinary conduct of the business of the Borrower
or any of its Restricted Subsidiaries;

       

      (h)           Liens
on Property of any Person which becomes a Restricted Subsidiary of the Borrower
after the date of this Agreement; provided that such
Liens are in existence at the time such Person becomes a Restricted Subsidiary
of the Borrower and were not created in anticipation or contemplation
thereof;

       

      (i)           Liens
upon real and/or tangible personal Property acquired after the date of this
Agreement (by purchase, construction or otherwise) by the Borrower or any of its
Restricted Subsidiaries, each of which Liens existed on such Property before the
time of its acquisition and was not created in anticipation or contemplation
thereof; provided that such
Lien shall not spread to cover any other Property of the Borrower or any such
Restricted Subsidiary;

       

      (j)           [Intentionally
Omitted]

       

      (k)           undetermined
or inchoate Liens arising in the ordinary course of and incidental to
construction, maintenance or current operations of the Borrower or any
Restricted Subsidiary which relate to obligations which are not overdue or which
are being contested in good faith and by appropriate proceedings and for which
appropriate reserves have been established in accordance with GAAP;

       

      (l)           Liens
incurred or created in the ordinary course of business and in accordance with
sound industry practice in respect of the exploration, development or operation
of Hydrocarbon Properties, or related production or processing facilities in
which such Person has an interest, or for the transmission of Hydrocarbons as
security in favor of any other Person conducting the exploration, development,
operation or transmission of the Property to which such Liens relate, for the
applicable Obligor’s portion of the costs and expenses of such exploration,
development, operation or transmission; provided that such
Liens are not overdue or are being contested in good faith and by appropriate
proceedings and for which appropriate reserves have been established in
accordance with GAAP;

       

      (m)           the
Lien or any right of distress reserved in or exercisable under any real property
lease for rent or otherwise to effect compliance with the terms of such lease in
respect of which the rent or other obligations is not at the time overdue or
which is being contested in good faith and by appropriate proceedings and for
which appropriate reserves have been established in accordance with
GAAP;

       

      
        
          
          

        

        
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    (n)          overriding
royalty interests, net profit interests, reversionary interests and carried
interests in respect of Hydrocarbon Properties of the Borrower or any Restricted
Subsidiary that (i) are in existence at the time any such Hydrocarbon Properties
are acquired by such the Borrower or such Restricted Subsidiary, (ii) come into
existence within six months following the date of the acquisition of such
Hydrocarbon Properties or (iii) are entered into between Obligors;

     

    (o)          farm-out
interests in Hydrocarbon Properties not constituting Proved Reserves entered
into in the ordinary course of business on standard industry terms with a Person
that is not an Affiliate of the Borrower or any Restricted Subsidiary and
otherwise entered into on an arm’s length basis; provided that the
value of all such farm-out interests, as reasonably determined by the Borrower
in good faith and evidenced by a written notice delivered to the Administrative
Agent prior to such farm-outs being granted, shall not at any time exceed
$30,000,000 (or its equivalent in other currencies) in the
aggregate;

     

    (p)          any
right of first refusal or similar agreement with respect to any Properties;
provided such
right is on ordinary business terms and provides for the receipt of value for
the Properties subject to such right in an amount (or on a basis which should
result in an amount) not substantially less than the fair market value of such
Properties;

     

    (q)          contractual
Liens which arise in the ordinary course of business under operating agreements,
joint venture agreements, oil and gas partnership agreements, oil and gas
leases, farm-out agreements, division orders, contracts for the sale,
transportation or exchange of oil and natural gas, unitization and pooling
declarations and agreements, area of mutual interest agreements, overriding
royalty agreements, marketing agreements, processing agreements, net profits
agreements, development agreements, gas balancing or deferred production
agreements, injection, repressuring and recycling agreements, salt water or
other disposal agreements, seismic or other geophysical permits or agreements,
and other agreements which are usual and customary in the oil and gas business
and are for claims that are not delinquent or that are being contested in good
faith by appropriate action and for which adequate reserves have been maintained
in accordance with GAAP; provided that any
such Lien referred to in this clause does not materially impair the use of the
Property covered by such Lien for the purposes for which such Property is held
by the Borrower or any Restricted Subsidiary or materially impair the value of
such Property subject thereto;

     

    (r)           Liens
arising solely by virtue of any statutory or common law provision relating to
banker's liens, rights of set-off or similar rights and remedies and burdening
only deposit accounts or other funds maintained with a creditor depository
institution; provided that no such
deposit account is a dedicated cash collateral account or is subject to
restrictions against access by the depositor in excess of those set forth by
regulations promulgated by the Board of Governors of the Federal Reserve System
of the United States, and no such deposit account is intended by the Borrower or
any of its Restricted Subsidiaries to provide collateral to the depository
institution;

    
      
         

      

      
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    (s)          Liens
on cash or securities pledged to secure performance of tenders, surety and
appeal bonds, government contracts, performance and return of money bonds, bids,
trade contracts, leases, statutory obligations, regulatory obligations and other
obligations of a like nature incurred in the ordinary course of business; provided that the
aggregate amount of Indebtedness permitted to be secured by such Liens under
this Section
9.06(u) shall not at any time exceed $2,000,000 (or its equivalent in
other currencies) except with the prior written consent of the Majority
Banks;

     

    (t)           judgment
and attachment Liens not giving rise to an Event of Default, provided that any
appropriate legal proceedings which may have been duly initiated for the review
of such judgment shall not have been finally terminated or the period within
which such proceeding may be initiated shall not have expired and no action to
enforce such Lien has been commenced;

     

    (u)          Liens
securing Indebtedness permitted under Section
9.07(i);

     

    (v)          Liens
on Unrestricted Properties in respect of non-recourse Indebtedness;

     

    (w)         Liens
on the Property of any Obligor which are not otherwise permitted by the
foregoing paragraphs of this Section 9.06 if the
indebtedness, liabilities or other obligations secured by such Liens are
incurred in the ordinary course of business of such Obligor, provided that the
aggregate amount of indebtedness, liabilities or other obligations permitted to
be secured by such Liens under this Section 9.06(p) shall
not at any time exceed $2,000,000 (or its equivalent in
other currencies); and

     

    (x)           any
extension, renewal or replacement of Liens permitted by the foregoing paragraphs
of this Section
9.06; provided that the
Liens permitted hereunder shall not be spread to cover any additional
Indebtedness or Property (other than a substitution of like
Property).

     

    9.07  Indebtedness.  The
Borrower shall not, nor shall it permit any of the Restricted Subsidiaries to,
create, incur or suffer to exist any Indebtedness except:

     

    (a)          Indebtedness
to the Administrative Agent, the Issuing Bank and the Banks hereunder or under
any Loan Document;

     

    (b)          Indebtedness
of Restricted Subsidiaries to the Borrower or to other Restricted Subsidiaries,
or of the Borrower to Restricted Subsidiaries or to the Parent that are
subordinated to the obligations of the Obligors to the Secured Parties under the
Loan Documents on terms reasonably satisfactory in form and substance to the
Administrative Agent;

    
      
         

      

      
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    (c)          [Intentionally
Omitted];

     

    (d)          [Intentionally
Omitted];

     

    (e)          Indebtedness
extended by suppliers on normal trade terms in connection with purchases of
goods and services in the ordinary course of business in an aggregate amount at
any time not to exceed $2,000,000 (or its equivalent in other
currencies);

     

    (f)           Indebtedness
in respect of Taxes, assessments or governmental charges, and Indebtedness in
respect of claims for labor, materials or supplies incurred in the ordinary
course of business to the extent that payment thereof shall not be overdue for a
period of more than 45 days;

     

    (g)          Indebtedness
pursuant to Designated Hedging Agreements or pursuant to any other hedging
agreement; provided that the
obligations of the Borrower or any Restricted Subsidiary under such hedging
agreement shall be unsecured if the counterparty to such Hedging Obligation is
not a Designated Hedging Counterparty;

     

    (h)          Indebtedness
secured by investments in or deposits with financial institutions referred to in
Sections
9.08(d) and (e);

     

    (i)           Indebtedness
in the form of Capital Lease Obligations up to $2,000,000 (or its equivalent in
other currencies) outstanding at any time;

     

    (j)           Indebtedness
existing as of the Closing Date and set forth in Schedule VIII;

     

    (k)          Indebtedness
incurred under working capital facilities or short-term local currency loans or
letters of credit up to $1,000,000 (or its equivalent in other currencies)
outstanding at any time;

     

    (l)           Indebtedness
(i) incurred to finance the purchase or construction of capital assets (which
shall be deemed to exist if the Indebtedness is incurred at or within 180 days
before or after the purchase or construction of the capital assets) or (ii) of a
Restricted Subsidiary acquired after the date hereof, which Indebtedness existed
at the time of such acquisition and was not incurred in contemplation of such
acquisition and extensions, renewals, refinancings and replacements thereof that
do not increase the outstanding principal amount thereof (inclusive of premium
and fees and expenses); provided that (x) the
aggregate principal amount of such Indebtedness incurred after the Closing Date
under clauses (i) and (ii) shall not exceed $2,000,000 outstanding at any time
and (y) such Indebtedness shall be recourse solely to the assets purchased or
constructed with the proceeds of such Indebtedness;

    
      
         

      

      
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    (m)         Indebtedness
associated with bonds or surety obligations required by governmental
requirements in connection with the operation of the Hydrocarbon
Properties;

     

    (n)          endorsements
of negotiable instruments for collection in the ordinary course of business;
and

     

    (o)          any
other Indebtedness of the Borrower and its Restricted Subsidiaries in an
aggregate principal amount (for the Borrower and all such Restricted
Subsidiaries) not to exceed $4,000,000 (or its equivalent in other currencies)
at any one time outstanding.

     

    9.08  Investments.  The
Borrower shall not, nor shall it permit any of its Restricted Subsidiaries to,
make or permit to remain outstanding any Investments except:

     

    (a)          [Intentionally
Omitted];

     

    (b)          operating
deposit accounts with banks;

     

    (c)          Permitted
Investments;

     

    (d)          Investments
by the Borrower and its Restricted Subsidiaries in capital stock of Restricted
Subsidiaries, in Indebtedness of the Borrower or any of its Restricted
Subsidiaries or in Indebtedness of other Subsidiaries permitted pursuant to
Section 6.08 or
9.07(b) hereof,
in each case, which may be made, either directly or through an investment in or
deposit with a financial institution located or operating in the jurisdiction of
the applicable Subsidiary or any applicable branch thereof, or a financial
institution located or operating in the United States (provided that the
interest of the Borrower in any such investment in the case of capital stock of
a Restricted Subsidiary which is directly owned by an Obligor is subject to a
first priority Lien of the Lenders in form and substance satisfactory to the
Administrative Agent, acting reasonably);

     

    (e)          [Intentionally
Omitted];

     

    (f)           Investments
which may be made in the Capital Stock of any Wholly Owned Subsidiary of the
Borrower formed or acquired by the Borrower or any of its other Wholly Owned
Subsidiaries (other than Unrestricted Subsidiaries) after the date of this
Agreement (a “New
Wholly Owned Subsidiary”); provided that (i)
such New Wholly Owned Subsidiary is maintained as a separate Subsidiary of the
Borrower, (ii) such New Wholly Owned Subsidiary is engaged principally in the
business of the acquisition and exploitation of, exploration for and/or
development, production, processing, marketing, gathering and sales of oil, gas
or other Hydrocarbons, (iii) the Borrower complies with Section 9.16 hereof
with respect to such New Wholly Owned Subsidiary immediately following the
consummation of such Investment by the Borrower;

    
      
         

      

      
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    (g)          loans
and advances by the Borrower and its Restricted Subsidiaries to their respective
employees in the ordinary course of their business as presently conducted in an
aggregate principal amount not to exceed $500,000 (or its equivalent in
other currencies) at any time outstanding;

     

    (h)          Investments
made with the proceeds of net income attributable to any Unrestricted Subsidiary
by such Unrestricted Subsidiary or another Unrestricted Subsidiary;

     

    (i)           [Intentionally
Omitted];

     

    (j)           Investments
made with the proceeds of Capital Stock of the Borrower or any Unrestricted
Subsidiary issued after the date of this Agreement; provided that no such
equity investment considered independently shall cause any Subsidiary or
Unrestricted Subsidiary to become a Restricted Subsidiary;

     

    (k)          Investments
made in any compensation plan or incentive arrangement established by any
Obligor or a Restricted Subsidiary for its employees or executives; provided that the
aggregate amount of any such Investment shall not exceed $500,000 in any fiscal
year of the Borrower;

     

    (l)           any
purchase or redemption of Capital Stock or Equity Rights from a departing
director or officer of any Obligor or a Restricted Subsidiary; provided that the
aggregate amount of any such purchase or redemption shall not exceed $1,000,000
in any fiscal year of the Borrower; and

     

    (m)         to
the extent not included in the foregoing clauses (a) through (l), additional
Investments up to but not exceeding $500,000 (or its equivalent in other
currencies) in the aggregate; provided that any
cash dividends received by the Borrower or any Restricted Subsidiary from an
Unrestricted Subsidiary, up to the amount of the Investments in such
Unrestricted Subsidiary, shall reduce pro tanto the aggregate
amount of the Investments in such Unrestricted Subsidiary for purposes of
calculating compliance with such $500,000 limitation.

     

    9.09  Dividend
Payments.  The Borrower shall not, nor shall it permit any of
the Restricted Subsidiaries to, declare or make any Dividend Payment at any
time; provided
that, if no Default, Event of Default or Borrowing Base Deficiency shall have
occurred and be continuing or shall occur as a result of the making of such
Dividend Payment, (i) any Subsidiary of the Borrower may declare and make
Dividend Payments solely to the Borrower or Wholly Owned Subsidiaries that are
Restricted Subsidiaries, and (ii) the Borrower may, in each of its fiscal years,
declare and make Dividend Payments in an amount not exceeding $2,000,000 or such
greater amount as may be approved by the Majority Banks in their
discretion.

     

    
      
        
        

      

      
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    9.10  Financial
Covenants.

     

    (a)          The
Borrower shall not permit the Debt Coverage Ratio as of the end of any of its
fiscal quarters to be greater than 2.0 to 1.0.

     

    (b)          The
Borrower shall not permit the ratio of Consolidated Current Assets to
Consolidated Current Liabilities, as of the end of any of its fiscal quarters,
to be less than 1.10 to 1.0.

     

    (c)          The
Borrower and its Restricted Subsidiaries shall, for each calendar year prior to
the Maturity Date, incur a minimum aggregate amount of $5,000,000 in such
calendar year of Capital Expenditures in connection with the development of
proved reserves located in the Colombian Hydrocarbon Properties.

     

    9.11  Collection
Accounts.  The Borrower shall direct all Offtakers to, and
shall deposit all other revenues from the Borrower’s and its Restricted
Subsidiaries’ interests in the Hydrocarbon Properties, as received, into the
Collection Accounts in US Dollars or such other currency as the Majority Banks
may approve in their reasonable discretion.  Amounts deposited in each
Collection Account may be freely withdrawn by the applicable Obligor in whose
name such Collection Account is maintained except (a) while a Borrowing Base
Deficiency has occurred and is continuing, (b) at any time after the
Administrative Agent exercises its rights pursuant to Section 1.03(d)
hereof or any other Loan Document to require JPMorgan Chase Bank, N.A. or BNP
Paribas (as appropriate) (or such other financial institution with which any
Collection Account is maintained) to cease honoring instructions from the
Borrower and retain all funds deposited in each Collection Account, and (c) at
any time after an Event of Default referred to in clause (f) or (g) of Section 10 has
occurred and is continuing unwaived, or at any time after any other Event of
Default referred to in Section 10 has
occurred and either all or any portion of the Loans shall have been declared to
be due and payable pursuant to ‎Section 10 and/or the
Administrative Agent shall have given notice to the Borrower that the
Commitments have been terminated.  No deposit account may be opened or
maintained in substitution for, or as an alternate to, a Collection Account
without the Administrative Agent’s prior written consent and without the
Administrative Agent having received a duly executed account pledge agreement
(in form and substance satisfactory to the Administrative Agent) granting in
favor of the Administrative Agent for the ratable benefit of the Secured Parties
a first-priority security interest in such substitute or alternate deposit
account and all amounts standing to the credit thereof from time to
time.

    
      
         

      

      
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    9.12  Lines of
Business.  The Borrower shall not, nor shall it permit any of
its Restricted Subsidiaries to, engage to any substantial extent in any line or
lines of business activity other than the business of the acquisition,
exploration, development, gathering, production (excluding refining, but
including for the avoidance of doubt any customary field processing with respect
to the Borrower’s or its Restricted Subsidiaries’ own production), processing,
marketing or sale of Hydrocarbons or products derived from any of the foregoing
and transactions reasonably associated therewith or reasonably required to
support such activities; provided that the
foregoing shall not prohibit (a) service agreements or similar agreements
entered into between Obligors in the normal course of business in each case
related to activities described in this Section 9.12, and (b)
other transactions expressly permitted by this Agreement.

     

    9.13  Transactions with
Affiliates.  Except as expressly permitted by this Agreement
(or as set forth in Schedule IX), the Borrower shall not, and shall not permit
any Restricted Subsidiaries to, directly or indirectly:  (a) make any
Investment in an Affiliate; (b) transfer, sell, lease, assign or otherwise
dispose of any Property to an Affiliate; (c) merge into or consolidate with or
purchase or acquire Property from an Affiliate; or (d) enter into any other
transaction directly or indirectly with or for the benefit of an Affiliate
(including, without limitation, Guarantees and assumptions of obligations of an
Affiliate); provided that (i) any
Affiliate who is an individual may serve as a director, officer or employee of
any of the Borrower and its Subsidiaries and receive reasonable compensation for
his or her services in such capacity; (ii) any of the Borrower and its
Restricted Subsidiaries may enter into transactions with Affiliates (other than
extensions of credit to Affiliates) in the ordinary course of business if the
monetary or business consideration arising therefrom would be substantially as
advantageous to the Borrower and its Restricted Subsidiaries as the monetary or
business consideration which would obtain in a comparable transaction with a
Person not an Affiliate; and (iii) the foregoing shall not prohibit service
agreements or similar agreements entered into between Obligors in the normal
course of business and consistent with similar agreements entered into by other
similarly situated oil and gas exploration and production companies, in each
case related to activities described in Section
9.12.

     

    9.14  Use of
Proceeds.

     

    (a)           The
Borrower shall use the proceeds of the Loans and the Letters of Credit to fund
expenditures incurred in connection with (i) the exploitation, development or
production of Hydrocarbons from the Colombian Hydrocarbon Properties, (ii)
Investments made directly or through any of its Restricted Subsidiaries in
connection with the acquisition, exploration and development of interests in
Hydrocarbon Properties as permitted by this Agreement and tangibles relating
thereto and the payment of any costs, fees or expenses required in connection
therewith, (iii) exploration, exploitation, transportation or marketing of
Hydrocarbons from properties included in the Borrowing Base and their general
corporate purposes, and (iv) other transactions expressly permitted by this
Agreement.

    
      
         

      

      
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    (b)           None
of the Administrative Agent, the Issuing Bank nor any Bank shall have any
responsibility to monitor or verify the application by the Borrower of any
amounts borrowed pursuant to this Agreement.

     

    9.15  Certain Obligations
Respecting Subsidiaries.  Except as permitted by Section 9.05 hereof,
the Borrower shall, and shall cause each of its Restricted Subsidiaries to, take
such action from time to time as shall be necessary to ensure that the Borrower
and each of its Restricted Subsidiaries at all times own (subject only to the
Lien of the Security Documents and Liens permitted by Section 9.06) at least the
same percentage of the issued and outstanding shares of each class of stock of
each of such Restricted Subsidiaries the stock of which is subject to the Lien
of the Security Documents as is owned on the date of this Agreement or, in the
case of New Wholly Owned Subsidiaries which are Restricted Subsidiaries created
or acquired after the date of this Agreement (other than any Wholly Owned
Subsidiaries of such Persons), the stock of which are required to be subject to
the Lien of the Security Documents, 100% of each class of stock of each of such
Subsidiaries (each of the Subsidiaries referred to above being herein called, a
“Pledged
Subsidiary”).  Without limiting the generality of the foregoing
and except as permitted by Section 9.05, none of
the Borrower and its Restricted Subsidiaries shall sell, transfer or otherwise
dispose of any shares of stock in any Pledged Subsidiary owned by it, nor permit
any Pledged Subsidiary to issue any shares of stock of any class whatsoever to
any Person (other than to the Borrower or another Obligor).  In the
event that any such additional shares of stock are issued by any Pledged
Subsidiary, the respective Obligor agrees forthwith to deliver to the
Administrative Agent pursuant to the Security Documents the certificates
evidencing such shares of stock, accompanied by undated stock powers executed in
blank and shall take such other action as the Administrative Agent shall request
to perfect the security interest created therein pursuant to the Security
Documents.  Except as expressly permitted by this Agreement, the
Borrower shall not and shall not permit any of its Restricted Subsidiaries to
enter into any indenture, agreement, instrument or other arrangement (other than
this Agreement and the other Loan Documents) that, directly or indirectly,
prohibits or restrains, or has the effect of prohibiting or restraining, or
imposes conditions upon the incurrence or payment of Indebtedness of the
Borrower and its Restricted Subsidiaries, or the declaration or payment of
dividends to the Borrower or any of its Restricted Subsidiaries.

     

    9.16  Additional Subsidiary
Guarantors.  The Borrower shall take such action, and shall
cause each of its Subsidiaries formed or acquired after the date of this
Agreement to take such action from time to time as shall be necessary to ensure
that each of such Subsidiaries (other than Unrestricted Subsidiaries) with
Tangible Net Worth of more than 5% of the Tangible Net Worth of the Borrower
determined on a consolidated basis in accordance with GAAP is a Subsidiary
Guarantor hereunder and an Obligor hereunder.  Each Subsidiary of the
Borrower that is required to become a Subsidiary Guarantor after the date of
this Agreement shall execute such instruments and agreements, in form and
substance satisfactory to, and as required by the Administrative Agent, acting
reasonably, to acknowledge that such Subsidiary has all of the obligations of a
Subsidiary Guarantor pursuant to this Agreement and to confirm that the Security
Documents constitute a Lien on its Properties free of any other encumbrances
except those described in Section
9.06.

    
      
         

      

      
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    9.17  Unrestricted
Subsidiaries.  The Borrower:

     

    (a)           shall
cause the management, business and affairs of each of the Borrower and its
Subsidiaries to be conducted in such a manner (including, without limitation, by
keeping separate books of account, furnishing separate financial statements of
Unrestricted Subsidiaries to creditors and potential creditors thereof and by
not permitting Properties of the Borrower and its respective Subsidiaries to be
commingled) so that each Unrestricted Subsidiary that is a corporation shall be
treated as a corporate entity separate and distinct from the Borrower and the
Restricted Subsidiaries;

     

    (b)           except
for Indebtedness permitted pursuant to Section 9.07 hereof
and Investments permitted pursuant to Section 9.08 hereof,
shall not, and shall not permit any of the Restricted Subsidiaries to, incur,
assume, Guarantee or be or become liable for any Indebtedness or other
obligations of any of the Unrestricted Subsidiaries; and

     

    (c)           shall
not permit any Unrestricted Subsidiary to hold any capital stock of or other
ownership interest in, or any Indebtedness of, any Restricted
Subsidiary.

     

    9.18  Limitations on Sale and
Leaseback Transactions.  The Borrower shall not, nor shall it
permit any of its Restricted Subsidiaries to, enter into, renew or extend any
transaction or series of related transactions pursuant to which the Borrower or
any such Restricted Subsidiary sells or transfers any Property in connection
with the leasing, or the release against installment payments, or as part of an
arrangement involving the leasing or release against installment payments, of
such Property to the Borrower or any of its Restricted Subsidiaries (“Sale and Leaseback
Transaction”), other than any such Sale and Leaseback Transaction which
constitutes non-recourse debt and which was entered into by a Restricted
Subsidiary prior to the designation of such Subsidiary as a Restricted
Subsidiary (or acquisition of such Restricted Subsidiary) and recourse, in all
events, is only to the assets subject to such sale leaseback (and does not
provide for recourse to any assets of such Restricted Subsidiary, other than the
assets subject to such sale leaseback, for any reason, including without
limitation pursuant to any tax indemnification or similar
agreement).

     

    9.19  Environmental
Matters.

     

    (a)           The
Borrower shall, and shall cause each of its Subsidiaries to comply in all
material respects with all Environmental Laws now or hereafter applicable to the
Borrower or its Subsidiaries, and shall obtain, at or prior to the time required
by applicable Environmental Laws, all environmental, health and safety permits,
licenses and other authorizations necessary for its operations and maintain such
authorizations in full force and effect, except to the extent failure to have
any such permit, license or authorization could not reasonably be expected to
have a Material Adverse Effect.

    
      
         

      

      
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    (b)           The
Borrower shall, and shall cause each of its Subsidiaries to, promptly furnish to
the Administrative Agent all requests for information, notices of claim, demand
letters, and other notifications, received by the Borrower or its Subsidiaries,
to the effect that, in connection with its ownership or use of any of its
Properties or the conduct of any of its business, it may be potentially
responsible in any material amount with respect to any investigation or clean-up
of Hazardous Material at any location.

     

    9.20  No Action to Affect Security
Documents.  Except for transactions expressly permitted hereby,
the Borrower shall not, nor shall it permit its Subsidiaries to, do anything to
adversely affect the priority of any Lien created pursuant to any Security
Document.

     

    9.21  Visits to
Properties.  The Borrower shall, and shall cause each of its
Restricted Subsidiaries to, permit representatives of the Administrative Agent
to visit and inspect any of its Properties (including any Hydrocarbon Property)
and examine and make abstracts from any of its books and records on reasonable
notice at any reasonable time (but, so long as no Event of Default shall have
occurred and be continuing, no more than twice in any calendar year) and to
discuss the business, operations, properties and financial and other condition
of the Borrower and its Restricted Subsidiaries with officers and employees of
the Borrower and its Restricted Subsidiaries and, together with representatives
of the Borrower, with its independent certified public
accountants.  The Borrower shall, and shall cause each of its
Restricted Subsidiaries to, pay all costs and expenses incurred by the
Administrative Agent in connection with any such visit, inspection or
examination pursuant to this Section; provided, that so
long as no Event of Default shall have occurred and be continuing, the Borrower
shall not be obliged to pay such costs and expenses for more than one such visit
and inspection in any calendar year.

     

    9.22  Title
Defects.  The Borrower shall, promptly upon becoming aware of
the existence of any title defect or any encumbrance (other than Permitted
Liens) affecting any Hydrocarbon Property which has been given material value in
the most recent Reserve Evaluation Report (other than title defects which do not
materially and adversely impact the value of such Hydrocarbon Property), give
the Administrative Agent prompt written notice of such title defect or
encumbrance, and in such case, the Borrower shall or shall cause the applicable
Subsidiary to undertake to take all steps necessary to cure such title defect or
discharge such encumbrance; provided that if the
Borrower or the applicable Subsidiary is unable or unwilling to cure such title
defect or discharge such encumbrance to the reasonable satisfaction of the
Administrative Agent within 60 days following the date on which the Borrower
shall have given the notice referred to in this Section 9.22, then
the remedy of the Administrative Agent and the Banks shall be to cause the
Borrowing Base to be reduced by an amount equal to the value (or such portion
thereof which has been impaired) assigned to such Hydrocarbon Property in the
most recent Borrowing Base which reductions may lead to the provisions of Section 2.10(a)
becoming applicable and actions taken by the Administrative Agent and the Banks
in that regard.

    
      
         

      

      
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    9.23  Offtake
Agreements.

     

    (a)           The
Borrower shall not, nor shall it permit its Restricted Subsidiaries to, amend,
modify, supplement or terminate any material Offtake Agreement or joint
operating agreement governing the Hydrocarbon Properties without the prior
written consent of the Majority Banks, such consent not to be unreasonably
withheld or delayed, unless such amendment, modification, supplement or
termination could not reasonably be expected to have a Material Adverse
Effect.

     

    (b)           Within
30 days of the Closing Date of this Agreement, but only to the extent such
consent has not previously been delivered to the Administrative Agent, the
Borrower shall ensure that a duly executed irrevocable consent of the Offtaker
under each material Offtake Agreement in effect on the Closing Date in form and
substance reasonably satisfactory to the Administrative Agent, is delivered to
the Administrative Agent, pursuant to which such Offtaker shall agree to make
all payments under such Offtake Agreement to the Collection Accounts; provided that in the
case of any Offtake Agreement with a national oil company, the 30 day deadline
may be extended with the prior written consent of the Majority
Banks.

     

    9.24  Further
Assurances.  Each Obligor shall, after notice thereof from the
Administrative Agent, do all such further acts and things and execute and
deliver all such further documents as shall be reasonably requested by the
Administrative Agent in order to give effect to this Agreement and the Loan
Documents and shall cause the same to be registered wherever, in the opinion of
the Administrative Agent, such registration may be required or advisable to
preserve, perfect or validate or continue the perfected status of any deemed or
other Lien granted pursuant to a Security Document or to enable such Bank to
exercise and enforce its rights hereunder with respect to such deemed or other
Lien.

     

    9.25  Activities of Holding
Companies.  Each of GTE Colombia, Gran Tierra Energy Cayman
Islands II Inc., a corporation organized under the laws of the Cayman Islands
(“Cayman Two”),
Gran Tierra Energy Canada ULC, an unlimited liability company organized under
the laws of the Province of Alberta, Canada (the “ULC”), shall not (a)
conduct, transact or otherwise engage in, or commit to conduct, transact or
otherwise engage in, any material business or operations other than (i) holding
(A) with respect to GTE Colombia only, the Capital Stock of the GP or the
Partnership and their respective Subsidiaries, and (B) with respect to Cayman
Two only, the Capital Stock of the ULC, (ii) performing its obligations and
activities under its organizational documents, (iii) issuing its own Capital
Stock subject to the terms hereof, (iv) preparing reports to its equity holders,
(v) holding board of directors and equity holders meetings, preparing
partnership, corporate or limited liability company records and other
partnership, corporate or limited liability company activities required to
maintain its separate partnership, corporate or limited liability company
structure or to comply with applicable requirements of law or the terms of its
organizational documents, and (vi) activities and assets incidental to the
foregoing clauses (i) through (v); (b) incur, create, assume or suffer to exist
any Indebtedness or other liabilities or financial obligations; (c) incur,
create, assume or suffer to exist any Lien upon any of its property, whether now
owned or hereafter acquired, other than pursuant to the Loan Documents; (d) own,
lease, manage or otherwise operate any material properties or assets; or (e)
directly own assets constituting an operating business; provided that the
foregoing shall not prevent (x) GTE Colombia, Cayman Two or the ULC from
complying with any obligation under that certain participation agreement, dated
as of June 22, 2006 (as amended through December 30, 2008, and as further
amended from time to time, so long as each such further amendment is not, taken
as a whole, materially adverse to the Banks, the “Participation
Agreement”), by and among the Partnership, the Borrower and Crosby
Capital LLC, or (y) the ULC from acting as an employer and engaging in and
performing such activities incidental thereto.

    
      
         

      

      
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    SECTION
10.

    EVENTS
OF DEFAULT.

     

    If one or
more of the following events (herein called “Events of Default”)
shall occur and be continuing:

     

    (a)           The
Borrower shall default in the payment when due (whether at stated maturity or
upon mandatory prepayment) of any principal of or interest on any Loan or
Reimbursement Obligation, any fee or any other amount payable by it hereunder or
under any other Loan Document and, where its failure to pay is caused solely by
administrative or technical error, such failure shall continue unremedied for a
period of three (3) Business Days (other than any default in a payment due on
the Maturity Date, which shall be an immediate Event of Default upon such
failure); or

     

    (b)           The
Borrower or any of its Restricted Subsidiaries shall default in the payment when
due of any principal of or interest on any of its other Indebtedness aggregating
$2,000,000 or more (or its equivalent in any other currency), or in the payment
when due of $2,000,000 or more (or its equivalent in any other currency) under
any Hedging Agreement, and such default shall continue unremedied for any
applicable grace period; or any event specified in any note, agreement,
indenture or other document evidencing or relating to any such Indebtedness or
any event specified in any such Hedging Agreement shall occur if the effect of
such event is to cause, or (with the giving of any notice or the lapse of time
or both) to permit the holder or holders of such Indebtedness (or a trustee or
agent on behalf of such holder or holders) to cause, such Indebtedness to become
due, or to be prepaid in full (whether by redemption, purchase, offer to
purchase or otherwise), prior to its stated maturity in an amount aggregating
$2,000,000 or more (or its equivalent in any other currency) or to have the
interest rate thereon reset to a level so that securities evidencing such
Indebtedness trade at a level specified in relation to the par value thereof;
or

    
      
         

      

      
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    (c)           Any
representation, warranty or certification made or deemed made herein or in any
other Loan Document (or in any modification or supplement hereto or thereto) by
any Obligor, or any certificate furnished to any Bank, the Issuing Bank or the
Administrative Agent pursuant to the provisions hereof or thereof, shall prove
to have been false or misleading as of the time made or furnished in any
material respect and such representation or warranty, if capable of cure,
remains uncured for 30 or more days following any Obligor’s knowledge thereof;
or

     

    (d)           Any
Obligor shall default in the performance of any of its obligations under any of
(i) Sections
2.10(a), 9.01, 9.05, 9.06 or 9.11 (to the extent
any such default continues unremedied for a period of 5 Business Days after the
earlier of (A) the notification of such default to such Obligor by the
Administrative Agent and (B) the date such Obligor knows or becomes aware of (or
ought reasonably to have known, or have become aware of the occurrence of such
default) or (ii) Sections 9.07, 9.08, 9.09, 9.10, 9.12, 9.14, 9.15, 9.18 or 9.22 (but subject to
the proviso thereof); or any Obligor shall default in the performance of any of
its other obligations in this Agreement or any other Loan Document and such
default shall continue unremedied for a period of 30 days after the earlier of
(i) the notification of such default to such Obligor by the Administrative Agent
and (ii) the date such Obligor knows or becomes aware of (or ought reasonably to
have known, or have become aware of) the occurrence of such default;
or

     

    (e)           The
Borrower or any of its Restricted Subsidiaries shall admit in writing its
inability to, or be generally unable to, pay its debts as such debts become due;
or

     

    (f)           The
Borrower or any of its Restricted Subsidiaries shall (i) apply for or consent to
the appointment of, or the taking of possession by, a receiver, custodian,
trustee, examiner or liquidator of itself or of all or a substantial part of its
Property, (ii) make a general assignment for the benefit of its creditors, (iii)
commence a voluntary proceeding for bankruptcy under any bankruptcy or
insolvency law, (iv) file a petition or take any other action seeking to take
advantage of any other law relating to bankruptcy, insolvency, reorganization
relating to the relief of debtors, liquidation, dissolution, arrangement
relating to the relief of debtors or winding-up, or composition or readjustment
of debts, (v) fail to controvert in a timely and appropriate manner, or
acquiesce in writing to, any petition or any other action filed against it in an
involuntary case under bankruptcy or insolvency law in its jurisdiction of
organization or where any material assets are located, or (vi) threaten or take
any corporate action for the purpose of effecting any of the foregoing or fail
to act in defense therefor; or

    
      
         

      

      
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    (g)           Except
as permitted by Section 9.05, a
proceeding or case shall be commenced, without the application or consent of the
Borrower or any of its Restricted Subsidiaries, in any court of competent
jurisdiction, seeking (i) its reorganization, liquidation, dissolution or
winding-up, or the composition or readjustment of its debts, (ii) the
appointment of a receiver, custodian, trustee, examiner, liquidator or the like
of the Borrower or such Restricted Subsidiary or of all or any substantial part
of its Property, or (iii) similar relief in respect of the Borrower or such
Restricted Subsidiary under any law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or adjustment of debts, and such
proceeding or case shall continue undismissed, or an order, judgment or decree
approving or ordering any of the foregoing shall be entered and continue
unstayed and in effect, for a period of 60 or more days; or an order for relief
against the Borrower or such Restricted Subsidiary shall be entered in an
involuntary case under the bankruptcy or insolvency law in its jurisdiction of
organization or where any material assets are located; or

     

    (h)           A
final judgment or judgments for the payment of money in excess of $2,000,000 in
the aggregate (or its equivalent in any other currency) shall be rendered by a
one or more courts, administrative tribunals or other bodies having jurisdiction
against the Borrower or any of its Restricted Subsidiaries and the same shall
not be discharged (or provision shall not be made for such discharge), or a stay
of execution thereof shall not be procured, within 60 days from the date of
entry thereof and the Borrower or the relevant Restricted Subsidiary shall not,
within said period of 60 days, or such longer period during which execution of
the same shall have been stayed, appeal therefrom and cause the execution
thereof to be stayed during such appeal; or

     

    (i)           Any
Property of any Obligor is seized pursuant to legal process and not bonded,
discharged or released within 30 days, and material value has been ascribed to
such property in the most recent Reserve Evaluation Report; or

     

    (j)           Any
Governmental Authority shall take any action to condemn, seize, nationalize or
appropriate any portion of the Property of any Obligor (either with or without
payment of compensation) used in the exploration or development of properties
and the fair market value of such Property constitutes greater than 20% of the
then-current Borrowing Base; or

     

    (k)           The
Liens created by the Security Documents shall at any time not constitute a valid
Lien perfected as required hereunder on the collateral intended to be covered
thereby (to the extent perfection by filing, registration, recordation or
possession is required herein or therein) in favor of the Secured Parties
specified to be benefited by such Security Document, free and clear of all other
Liens (other than Permitted Liens or except as and to the extent provided in
Section 9.22),
or, except for expiration, termination or satisfaction of the obligations
thereunder in accordance with its terms, any of the Security Documents shall for
whatever reason be terminated or cease to be in full force and effect, or the
enforceability thereof shall be contested by any Obligor; provided that such
termination, cessation, invalidity or imperfection is not attributable to any
action or inaction of the Administration Agent; provided further that
the Obligors shall use all reasonable commercial efforts to cure such
termination, cessation, invalidity or imperfection promptly upon being notified
thereof by the Administrative Agent; or

    
      
         

      

      
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    (l)           Any
Obligor defaults on any of its obligations under an Offtake Agreement where the
effect of such default is to entitle the Offtaker under such Offtake Agreement,
either immediately or with the giving of notice, the lapse of time or a
combination thereof, (i) to terminate such Offtake Agreement, or to take any
other course of action with respect thereto and (ii) such action could
reasonably be expected to have a Material Adverse Effect; or

     

    (m)          A
Change of Control occurs.

     

    THEREUPON:  (1)
in the case of an Event of Default other than one referred to in clause (f) or
(g) of this Section
10 with respect to any Obligor, the Administrative Agent may and, upon
request of the Majority Banks, shall, by notice to the Borrower, terminate the
Commitments and/or declare the principal amount then outstanding of, and the
accrued interest on, the Loans, the Reimbursement Obligations and all other
amounts payable by the Obligors hereunder and under the Notes to be forthwith
due and payable, whereupon such amounts shall be immediately due and payable
without presentment, demand, protest or other formalities of any kind, all of
which are hereby expressly waived by each Obligor; and (2) in the case of the
occurrence of an Event of Default referred to in clause (f) or (g) of this Section 10 with
respect to any Obligor, the Commitments shall automatically be terminated and
the principal amount then outstanding of, and the accrued interest on, the
Loans, the Reimbursement Obligations and all other amounts payable by the
Obligors hereunder and under the Notes shall automatically become immediately
due and payable without presentment, demand, protest or other formalities of any
kind, all of which are hereby expressly waived by each Obligor.

     

    In
addition, upon the occurrence and during the continuance of any Event of Default
(if the Administrative Agent has declared the principal amount then outstanding
of, and accrued interest on, the Loans and all other amounts payable by the
Borrower hereunder and under the Notes to be due and payable), the Obligors
agree that they shall, if requested by the Administrative Agent or the Majority
Banks through the Administrative Agent (and, in the case of any Event of Default
referred to in clause (f) or (g) of this Section 10 with
respect to any Obligor, forthwith, without any demand or the taking of any other
action by the Administrative Agent or such Banks) provide cash collateral for
all Letters of Credit by paying to the Administrative Agent in immediately
available funds an amount equal to the then aggregate undrawn face amount of all
Letters of Credit, which funds shall be held by the Administrative Agent, as
collateral security in the first instance for the Letter of Credit
Liabilities.

     

    All
monies received by the Administrative Agent or any Bank from the exercise of
remedies hereunder, under the Security Documents or under any other Loan
Documents shall, unless otherwise required by the terms of the other Loan
Documents or by applicable law, be applied as follows:

    
      
         

      

      
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    first, to the payment
of all expenses (to the extent not otherwise paid by any Obligor) incurred by
the Administrative Agent and the Banks in connection with the exercise of such
remedies, including, without limitation, all costs and expenses of collection,
attorneys’ fees and disbursements, court costs and any foreclosure
expenses;

     

    second, to the
payment of all accrued and unpaid interest on the Loans, pro rata to each Bank
according to the amount of accrued and unpaid interest then owing to such
Bank;

     

    third, to the payment
pro rata of any fees
then accrued and payable to each Bank under this Agreement in respect of the
Loans;

     

    fourth, to the
payment pro rata of the
respective outstanding principal amounts of the Loans and Letter of Credit
Liabilities;

     

    fifth, to the payment
pro rata of all amounts
owed to each Designated Hedging Counterparty under the Designated Hedging
Agreements;

     

    sixth, to the payment
of all other amounts owed by the Borrower to the Administrative Agent or any
Bank under this Agreement or any other Loan Document, and if such proceeds are
insufficient to pay such amounts in full, to the payment of such amounts pro rata; and

     

    seventh, any surplus
remaining after the indefeasible payment in full in cash of all of the above
amounts shall be distributed to the Borrower or to whomsoever shall be lawfully
entitled thereto.

     

    SECTION
11.

    THE
ADMINISTRATIVE AGENT.

     

    11.01  Appointment, Powers and
Immunities.  Each Bank hereby irrevocably appoints and
authorizes the Administrative Agent to act as its agent hereunder and under the
other Loan Documents with such powers as are specifically delegated to such
Administrative Agent by the terms of this Agreement and of the other Loan
Documents, to which such Administrative Agent is a party, together with such
other powers as are reasonably incidental thereto.  The Administrative
Agent (which term as used in this sentence and in Section 11.05 and the
first sentence of Section 11.06 hereof
shall include reference to its Affiliates and its own and its Affiliates’
officers, directors, employees and agents):  (a) shall have no duties
or responsibilities (including fiduciary or implied duties) except those
expressly set forth in this Agreement and in the other Loan Documents, to which
such Administrative Agent is a party, and shall not by reason of this Agreement
or any other Loan Document be a trustee for any Bank; (b) shall not be
responsible to the Banks for any recitals, statements, representations or
warranties contained in this Agreement or in any other Loan Document, or in any
certificate or other document referred to or provided for in, or received by any
of them under, this Agreement or any other Loan Document, or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of any
collateral security provided for by any of the Security Documents, or of this
Agreement, any Note or any other Loan Document or any other document referred to
or provided for herein or therein, or for any failure by the Borrower, any other
Obligor or any other Person to perform any of its obligations hereunder or
thereunder; (c) shall not be required to initiate or conduct any litigation or
collection proceedings hereunder or under any other Loan Document; (d) shall not
be responsible for any action taken or omitted to be taken by it hereunder or
under any other Loan Document or under any other document or instrument referred
to or provided for herein or therein or in connection herewith or therewith,
except for its own gross negligence or willful misconduct; and (e) shall not
have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights or powers expressly contemplated by this
Agreement and the other Loan Documents that the Administrative Agent is required
to exercise following its receipt of written instructions from the Majority
Banks, as the case may be, in accordance with the provisions of this Agreement
and the other Loan Documents.  The Administrative Agent may employ
agents and attorneys-in-fact and shall not be responsible for the negligence or
misconduct of any such agents or attorneys-in-fact selected by it in good
faith.  The Administrative Agent may deem and treat the payee of any
Note as the holder thereof for all purposes hereof unless and until a notice of
the assignment or transfer thereof shall have been filed with the Administrative
Agent, together with the consent of the Borrower to such assignment or transfer
(to the extent provided in Section 12.06(b)
hereof).

    
      
         

      

      
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    11.02  Reliance by Administrative
Agent.  The Administrative Agent shall be entitled to rely upon
any certification, notice or other communication (including, without limitation,
any thereof by telephone, fax, telex, electronic mail or other electronic means)
believed by it to be genuine and correct and to have been signed or sent by or
on behalf of the proper Person or Persons, and upon advice and statements of
legal counsel, independent accountants and other experts selected by the
Administrative Agent.  As to any matters not expressly provided for by
this Agreement or any other Loan Document, the Administrative Agent shall in all
cases be fully protected in acting, or in refraining from acting, hereunder or
thereunder in accordance with instructions given by the Majority Banks, and any
action taken or failure to act pursuant thereto shall be binding on all of the
Banks.

     

    11.03  Defaults.  The
Administrative Agent shall not be deemed to have knowledge or notice of the
occurrence of a Default (other than the non-payment of principal of or interest
on Loans, Reimbursement Obligations or of commitment fees) unless the
Administrative Agent has received notice from a Bank or any Obligor specifying
such Default and stating that such notice is a “Notice of
Default”.  In the event that the Administrative Agent receives
such a notice of the occurrence of a Default, the Administrative Agent shall
give prompt notice thereof to the Banks.  The Administrative Agent
shall (subject to Section 11.07 hereof)
take such action with respect to such Default as shall be directed by the
Majority Banks; provided that, unless
and until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default as it shall deem
advisable in the best interest of the Banks, except to the extent that this
Agreement expressly requires that such action be taken, or not be taken, only
with the consent or upon the authorization of the Majority Banks or all of the
Banks, as the case may be.

    
      
         

      

      
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    11.04  Rights as a
Bank.  The Bank serving as Administrative Agent hereunder shall
have the same rights and powers in its capacity as a Bank as any other Bank and
may exercise the same as though it were not the Administrative Agent, and such
Bank and its Affiliates may accept deposits from, lend money to and generally
engage in any kind of business with the Borrower or any Subsidiary or Affiliate
thereof as if it were not the Administrative Agent hereunder.

     

    11.05  Indemnification.  The
Banks agree to indemnify the Administrative Agent (to the extent not reimbursed
under Sections
12.03 and 12.07 hereof, but
without limiting the obligations of the Obligors under said Sections 12.03 and
12.07), ratably
in accordance with the aggregate principal amount of the Loans and Reimbursement
Obligations held by the Banks (or, if no Loans or Reimbursement Obligations are
at the time outstanding, ratably in accordance with their respective Commitments
or, if no Loans, Reimbursement Obligations or Commitments are at the time
outstanding or in effect, ratably in accordance with their respective
Commitments as most recently in effect) for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind and nature whatsoever that may be imposed
on, incurred by or asserted against the Administrative Agent (including by any
Bank) arising out of or by reason of any investigation in or in any way relating
to or arising out of this Agreement or any other Loan Document or any other
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby (including, without limitation, the costs and
expenses that the Obligors are obligated to pay under Sections 12.03 and
12.07 hereof,
but excluding, unless a Default has occurred and is continuing, normal
administrative costs and expenses incident to the performance of its agency
duties hereunder) or the enforcement of any of the terms hereof or thereof or of
any such other documents; provided that no Bank
shall be liable for any of the foregoing to the extent they arise from the gross
negligence or willful misconduct of the party to be indemnified.

     

    11.06  Non-Reliance on Agent and
Other Banks.  Each Bank agrees that it has, independently and
without reliance on the Administrative Agent or any other Bank, and based on
such documents and information as it has deemed appropriate, made its own credit
analysis of the Borrower and its Subsidiaries and decision to enter into this
Agreement and that it shall, independently and without reliance upon the
Administrative Agent or any other Bank, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
analysis and decisions in taking or not taking action under this
Agreement.  The Administrative Agent shall not be required to keep
itself informed as to the performance or observance by any Obligor of this
Agreement or any of the other Loan Documents or any other document referred to
or provided for herein or therein or to inspect the Properties or books of the
Borrower or any of its Subsidiaries.  Except for notices, reports and
other documents and information expressly required to be furnished to the Banks
by the Administrative Agent hereunder, the Administrative Agent shall not have
any duty or responsibility to provide any Bank with any credit or other
information concerning the affairs, financial condition or business of the
Borrower or any of its Subsidiaries (or any of their Affiliates) that may come
into the possession of the Administrative Agent or any of its
affiliates.

    
      
         

      

      
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    11.07  Failure to
Act.  Except for action expressly required of the
Administrative Agent hereunder and under the other Loan Documents, the
Administrative Agent shall in all cases be fully justified in failing or
refusing to act hereunder and thereunder unless it shall receive further
assurances to its satisfaction from the Banks of their indemnification
obligations under Section 11.05 hereof
against any and all liability and expense that may be incurred by it by reason
of taking or continuing to take any such action.

     

    11.08  Resignation or Removal of
Agent.  Subject to the appointment and acceptance of a
successor Administrative Agent as provided below, the Administrative Agent may
resign at any time by giving notice thereof to the Banks and the Borrower, and
the Administrative Agent may be removed at any time with or without cause by the
Majority Banks.  Upon any such resignation or removal, the Majority
Banks shall have the right to appoint a successor Administrative
Agent.  If no successor Administrative Agent shall have been so
appointed by the Majority Banks and shall have accepted such appointment within
30 days after the retiring Administrative Agent’s giving of notice of
resignation or the Majority Banks’ removal of the retiring Administrative Agent,
then the retiring Administrative Agent may, on behalf of the Banks, appoint a
successor Administrative Agent, that shall be a bank experienced in transactions
of the type contemplated by this Agreement and which has an office in New York,
New York or London, England with a combined capital and surplus of at least
$500,000,000 (or an equivalent amount in other currencies).  Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent, and such retiring Administrative Agent
shall be discharged from its duties and obligations hereunder.  After
any retiring Administrative Agent’s resignation or removal hereunder as
Administrative Agent, the provisions of this Section 11 shall continue in effect
for its benefit in respect of any actions taken or omitted to be taken by it
while it was acting as Administrative Agent.

     

    11.09  Consents under Other Loan
Documents.  The Administrative Agent may, with the prior
written consent of the Majority Banks (but not otherwise) consent to any
modification, supplement or waiver under any of the Loan Documents other than
this Agreement, to which the Administrative Agent is a party; provided that without
the prior consent of each Bank, the Administrative Agent shall not (except as
provided herein or in the Security Documents to which the Administrative Agent
is a party) release any collateral or otherwise terminate any Lien under any
Loan Document providing for collateral security, or agree to additional
obligations being secured by such collateral security, except that no such
consent shall be required, and the Administrative Agent is hereby authorized, to
release any Lien covering Property which is the subject of a disposition of
Property permitted hereunder.

    
      
         

      

      
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    11.10  Collateral
Sub-Agents.  Each Bank by its execution and delivery of this
Agreement agrees that, in the event it shall hold any Permitted Investments
referred to therein, such Permitted Investments shall be held in the name and
under the control of such Bank, and such Bank shall hold such Permitted
Investments as a collateral sub-agent for the Administrative Agent
thereunder.  Each Obligor by its execution and delivery of this
Agreement hereby consents to the foregoing.

     

    11.11  Dealings With the
Administrative Agent.  In the absence of written notice or any
actual knowledge of a lack of authority of the Administrative Agent to act for
and on behalf of the Banks in respect of any matter hereunder or under the Loan
Documents, the Obligors shall be entitled to conclusively assume that any
certificate, directive or other writing of the Administrative Agent in
connection with such matter has been duly authorized by the Banks in accordance
with this Agreement.

     

    SECTION
12.

    MISCELLANEOUS.

     

    12.01  Waiver.  No
failure on the part of the Administrative Agent or any Bank to exercise and no
delay in exercising, and no course of dealing with respect to, any right, power
or privilege under this Agreement or any Note shall operate as a waiver thereof,
nor shall any single or partial exercise of any right, power or privilege under
this Agreement or any Note preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.  The remedies
provided herein are cumulative and not exclusive of any remedies provided by
law.

     

    12.02  Notices.  All
notices, requests and other communications provided for herein and under the
Security Documents (including, without limitation, any modifications of, or
waivers or consents under, this Agreement) may be given or made by fax or other
writing and faxed, mailed or delivered to the intended recipient:

     

    (a)           in
the case of any Obligor, at the “Address for Notices” specified below the name
of such Obligor on the signature pages hereof;

     

    (b)           in
the case of the Administrative Agent, at the “Address for Notices” specified
below its name on the signature pages hereof;

    
      
         

      

      
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    (c)           in
the case of each Issuing Bank, at the “Address for Notices” specified below the
name of the Issuing Bank on the signature pages hereof; and

     

    (d)           in
the case of any Bank, at its address (or fax number) set forth in its
Administrative Questionnaire;

     

    or, as to
any party, at such other address as shall be designated by such party in a
notice to the Borrower and the Administrative Agent given in accordance with
this Section
12.02.  Except as otherwise provided in this Agreement, all
such communications shall be deemed to have been duly given when transmitted by
fax (and receipt is electronically confirmed), personally delivered or, in the
case of a mailed notice, upon receipt, in each case given or addressed as
aforesaid.  Notwithstanding the foregoing, any notice or other
communication provided for herein and under the Security Documents may be given
or made by electronic mail, if the Administrative Agent agrees that this is to
be an accepted form of communication and if the Administrative Agent and each
Obligor has notified the other in writing of its electronic mail address and/or
any other information required to enable the sending and receipt of information
by that means and promptly following any changes thereto; provided that, except
as provided in Section
9.01, the
foregoing shall not apply to any notice or other communication to a Secured
Party which has notified the Administrative Agent that it does not wish to
receive any notice or other communication by electronic mail.  Unless
the Administrative Agent otherwise prescribes, notices and other communications
sent to an e-mail address shall be deemed received upon the sender’s receipt of
an acknowledgement from the intended recipient (such as by the “return receipt
requested” function, as available, return e-mail or other written
acknowledgement); provided that if such
notice or other communication is not sent during the normal business hours of
the recipient, such notice or communication shall be deemed to have been sent at
the opening of business on the next business day for the recipient; provided further that
such notice or other communication is actually received in readable form by the
intended recipient.

     

    12.03  Expenses.  The
Obligors hereby jointly and severally agree to pay or reimburse each of the
Banks and the Administrative Agent for paying:  (a) all reasonable and
documented out-of-pocket costs and expenses of the Administrative Agent
(including, without limitation, the reasonable fees and expenses of Jones Day,
special New York counsel to the Administrative Agent, and Gómez-Pinzón Abogados,
Colombian counsel to the Administrative Agent), in connection with (A) the
negotiation, preparation, execution and delivery of this Agreement and the other
Loan Documents and the extensions of credit hereunder; provided that in no
event shall the foregoing include any costs or expenses in respect of in-house
counsel or advisors of the Administrative Agent or of any Bank or Participant
(as defined below) and (B) any modification, supplement or waiver of any of the
terms of this Agreement or any of the other Loan Documents; (b) all reasonable
out-of-pocket costs and expenses of the Banks and the Administrative Agent
(including, without limitation, reasonable counsel fees and expenses) in
connection with (i) any Default and any enforcement or collection proceedings
resulting therefrom or in connection with the negotiation of any restructuring
or “work-out” (whether or not consummated), or the obligations of the Obligors
hereunder and (ii) the enforcement of this Section 12.03 or
Section 12.07;
and (c) all transfer, stamp, documentary or other similar taxes, assessments or
charges levied by any governmental or revenue authority in respect of this
Agreement or any of the other Loan Documents or any other document referred to
herein or therein and all costs, expenses, taxes, assessments and other charges
incurred in connection with any filing, registration, recording or perfection of
any security interest contemplated by any Loan Document or any other document
referred to therein; provided that in no
event shall the Obligors be responsible for paying any amounts or costs incurred
as a result of the gross negligence or willful misconduct of the Administrative
Agent or any Bank.

    
      
         

      

      
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    12.04  Amendments,
Etc.  Except as otherwise expressly provided in this Agreement,
any provision of this Agreement may be modified or supplemented only by an
instrument in writing signed by the Obligors, the Administrative Agent and the
Majority Banks (and if such amendment relates to the rights or obligations of
the Issuing Bank or any Letter of Credit, the Issuing Bank) and any provision of
this Agreement may be waived by the Majority Banks (and if such amendment
relates in any way to any Letter of Credit, the Issuing Bank); provided that no
modification, supplement or waiver shall, unless by an instrument signed by all
of the affected Banks or by the Administrative Agent acting with the consent of
all of the Banks whose rights or interests are affected thereby:  (i)
increase, or extend the term of any of the Commitments, or extend the time or
waive any requirement for the reduction or termination of any of the
Commitments, (ii) extend the date fixed for the payment of principal of or
interest on the Loans, the Reimbursement Obligations or any fee hereunder, (iii)
reduce the amount of any such payment of principal, (iv) reduce the rate at
which interest is payable thereon or any fee is payable hereunder, (v) alter the
rights or obligations of the Obligors to prepay Loans under Section 2.10, (vi) alter
the terms of this Section 12.04, (vii)
change the currency of any payment required hereunder or under the other Loan
Documents or (viii) modify the definition of the term “Majority Banks” or modify
in any other manner the number or percentage of the Banks required to make any
determinations or waive any rights hereunder or waive or modify any provision
hereof.  Any modification or supplement of this Agreement that
increases any of the obligations or reduces or impairs any of the rights of, or
otherwise adversely affects the interests of, the Administrative Agent or the
Issuing Bank under this Agreement or any of the other Loan Documents shall
require the consent of the Administrative Agent or the Issuing Bank (as the case
may be).

     

    Anything
in this Agreement to the contrary notwithstanding, if:

     

    
      	
               
      

            	
              (x)

            	
              at
      a time when the conditions precedent set forth in Section 7
      hereof to any Loans or other extension of credit hereunder are, in the
      opinion of the Majority Banks satisfied, any Bank shall fail to fulfill
      its obligations to make the Loan to be made by it;
  or

            

    

     

    
      
         

      

      
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              (y)

            	
              any
      Bank shall fail to pay to the Administrative Agent for the account of the
      Issuing Bank the amount of such Bank’s Commitment Percentage of the
      Commitments of any payment under a Letter of Credit pursuant to Section
      2.03(b)(v) hereof;

            

    

     

    then, for
so long as such failure shall continue, such Bank shall (unless the Majority
Banks, determined, in either case, as if such Bank were not a “Bank” hereunder,
shall otherwise consent in writing) be deemed for all purposes relating to
amendments, modifications, waivers or consents under this Agreement or any of
the other Loan Documents (including, without limitation, under this Section 12.04 and
under Section
11.09 hereof) to have no Loans, Letter of Credit Liabilities or
Commitments, shall not be treated as a “Bank” hereunder when performing the
computation of Majority Banks, and shall have no rights under the preceding
paragraph of this Section 12.04 or
under Section
11.09 hereof; provided that any
action taken by the other Banks with respect to the matters referred to in the
preceding paragraph shall not be effective as against such Bank.

     

    12.05  Successors and
Assigns.  This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.

     

    12.06  Assignments and
Participations.

     

    (a)           No
Obligor may assign any of its rights or obligations hereunder or under the Notes
without the prior consent of the Majority Banks and the Administrative
Agent.

     

    (b)           Each
Bank may (with the prior consent of the Borrower, not to be unreasonably
withheld, conditioned or delayed) assign and, so long as no Default shall have
occurred and be continuing, if required by the Borrower in accordance with Section 5.07 upon at
least five (5) Business Days’ notice to such Bank and the Administrative Agent,
shall, assign any of its Loans, its Note, its Commitment and its Letter of
Credit Interest (but only with the consent of, in the case of an outstanding
Commitment, the Administrative Agent and, in the case of a Commitment or a
Letter of Credit Interest in connection with Letters of Credit, the Issuing
Bank); provided
that

     

    (i)           no
such consent by the Borrower or the Administrative Agent or the Issuing Bank
shall be required in the case of any assignment to another Bank;

     

    (ii)          any
such partial assignment (other than to another Bank) shall be in an amount at
least equal to $1,000,000; provided that in each
case unless a Bank is assigning all of its Loans, Letter of Credit Interests and
Commitments, the assigning Bank shall maintain a Commitment of not less than
$1,000,000;

    
      
         

      

      
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    (iii)           each
such permitted assignment by a Bank of its Loans, Note, Commitment and Letter of
Credit Interest shall be made in such manner so that the same portion of its
Loans, Note, Commitment and Letter of Credit Interest is assigned to the
respective assignee;

     

    (iv)          each
such assignment made as a result of a demand by the Borrower pursuant to this
Section
12.06(b) shall be arranged by the Borrower after consultation with the
Administrative Agent and shall be either an assignment of all of the rights and
obligations of the assigning Bank under this Agreement or an assignment of a
portion of such rights and obligations made concurrently with another such
assignment or other such assignments that together cover all of the rights and
obligations of the assigning Bank under this Agreement; and

     

    (v)           no
Bank shall be obligated to make any such assignment as a result of a demand by
the Borrower pursuant to this Section 12.06(b)
unless and until such Bank shall have received one or more payments from either
the Borrower or one or more assignees in an aggregate amount at least equal to
the aggregate outstanding principal amount of the Loans and Reimbursement
Obligations owing to such Bank (or that such Reimbursement Obligations have been
irrevocably assumed by the assignee Bank), together with accrued interest
thereon to the date of payment of such principal amount and all other amounts
payable to such Bank under this Agreement.

     

    Upon
execution and delivery by the assignee to the Borrower, the Administrative Agent
and the Issuing Bank, to the extent required above, of an instrument in writing
pursuant to which such assignee agrees to become a “Bank” hereunder (if not
already a Bank) having the Commitment, Loans and, if applicable, the Letter of
Credit Interest specified in such instrument, and upon consent thereto by the
Administrative Agent as provided in this Section 12.06(b) and
the Issuing Bank, the assignee shall have, to the extent of such assignment
(unless provided in such assignment with the consent of the Administrative Agent
and the Issuing Bank), the obligations, rights and benefits of a Bank hereunder
holding the Commitment, Loans and, if applicable, the Letter of Credit Interest
(or portions thereof) assigned to it (in addition to the Commitment, Loans and
Letter of Credit Interest theretofore held by such assignee) and the assigning
Bank shall, to the extent of such assignment, be released from the Commitment,
Loans and Letter of Credit Interest (or portion thereof) so
assigned.  Upon each such assignment, the assigning Bank shall pay the
Administrative Agent an assignment fee of $3,000.

    
      
         

      

      
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    (c)           Each
Bank may sell or agree to sell to one or more other Persons (a “Participant”) a
participation in all or any portion of its rights and obligations under this
Agreement (including, without limitation, all or any portion of its Commitment
and the Loans and/or Letter of Credit Interest held by it).  In the
event of any such participation by a Bank of participating interests to a
Participant, such Bank’s obligations under this Agreement shall remain
unchanged, such Bank shall remain solely responsible for the performance thereof
and the Obligors shall continue to deal solely and directly with such “Bank” for
all purposes hereunder and such Participant shall not have any other rights or
benefits under this Agreement, any Note or any other Loan Document, except as
provided in Section
4.08(c) hereof (the Participant’s rights against such Bank in respect of
such participation to be those set forth in the agreements executed by such Bank
in favor of the Participant).  All amounts payable by the Obligors to
any Bank under Section 5 hereof in respect of Loans, Letter of Credit Interests
and its Commitment, shall be determined as if such Bank had not sold or agreed
to sell any participations in such Loans, Letter of Credit Interest and
Commitment, and as if such Bank were funding each of such Loans, Letter of
Credit Interests and Commitment in the same way that it is funding the portion
of such Loans, Letter of Credit Interests and Commitment in which no
participations have been sold.  In no event shall a Bank that sells a
participation agree with the Participant to take or refrain from taking any
action hereunder or under any other Loan Document except that such Bank may
agree with the Participant that it shall not, without the consent of the
Participant, agree to any of the following (to the extent the rights or interest
of the Participant are adversely affected thereby):  (A) increase or
extend the term, or extend the time or waive any requirement for the reduction
or termination, of such Bank’s Commitment, (B) extend the date fixed for the
payment of principal of or interest on the related Loan or Loans, Reimbursement
Obligations or any portion of any fee hereunder, (C) reduce the amount of any
such payment of principal, (D) reduce the rate at which interest is payable
thereon, or any fee hereunder payable to the Participant, to a level below the
rate at which the Participant is entitled to receive such interest or fee, (E)
alter the rights or obligations of the Borrower to prepay the related Loans or
(F) consent to any other modification, supplement or waiver hereof or of any of
the other Loan Documents to the extent that the same, under Section 11.09 or
12.04 hereof, requires the consent of each Bank.

     

    (d)           In
addition to the assignments and participations permitted under the foregoing
provisions of this Section 12.06,
including, without limitation, Section 12.06(c)
hereof, any Bank may assign and pledge all or any portion of its Loans and its
Notes to any Federal Reserve Bank as collateral security pursuant to Regulation
A and any Operating Circular issued by such Federal Reserve Bank.  No
such assignment shall release the assigning Bank from its obligations
hereunder.

     

    (e)           A
Bank may furnish any information concerning the Borrower or any of its
Subsidiaries in the possession of such Bank from time to time to assignees and
participants (including prospective assignees and participants), subject,
however, to the provisions of Section 12.13
hereof.

     

    (f)           Anything
in this Section
12.06 to the contrary notwithstanding, no Bank may assign or participate
any interest in any Loan or Reimbursement Obligation held by it hereunder to the
Obligors or any of their Affiliates or Subsidiaries without the prior written
consent of each Bank.

     

    
      
        
        

      

      
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    (g)           The
Administrative Agent shall provide copies to the Borrower from time to time (and
promptly following any request from the Borrower for such copies) of the
Administrative Questionnaire as completed by each Bank.

     

    12.07  Indemnification.  Each
Obligor hereby jointly and severally agrees (i) to indemnify each Secured Party
and their respective directors, officers, employees, attorneys and agents from,
and hold each of them harmless against, any and all losses, liabilities, claims,
damages or expenses incurred by any of them (including, without limitation, any
and all losses, liabilities, claims, damages or expenses incurred by each
Secured Party, whether or not such Secured Party is a party thereto)
(collectively, “Damages”) arising out
of or by reason of any investigation or litigation or other proceedings
(including any threatened investigation or litigation or other proceedings)
relating to the extensions of credit hereunder or any actual or proposed use by
each Obligor of the proceeds of any of the extensions of credit hereunder,
including, without limitation, the reasonable fees and disbursements of counsel
incurred in connection with any such investigation or litigation or other
proceedings (but excluding any such losses, liabilities, claims, damages or
expenses incurred by reason of the gross negligence, bad faith or willful
misconduct of the Person to be indemnified) and (ii) not to assert any claim
against a Secured Party, any of its affiliates, or any of its respective
directors, officers, employees, attorneys and agents, on any theory of
liability, for special, indirect, consequential or punitive damages arising out
of or otherwise relating to any of the transactions contemplated herein or in
any other Loan Document; provided that each
Obligor may enforce the obligations, if applicable, of the Banks and the Issuing
Bank hereunder.  Without limiting the generality of the foregoing,
each Obligor shall indemnify each Secured Party from, and hold each Secured
Party harmless against, any losses, liabilities, claims, damages or expenses
described in the preceding sentence (but excluding, as provided in the preceding
sentence, any loss, liability, claim, damage or expense incurred by reason of
the gross negligence, bad faith or willful misconduct of the Person to be
indemnified) arising under any Environmental Law as a result of the past,
present or future operations of the Borrower or any of its Subsidiaries (or any
predecessor in interest to the Borrower or any of its Subsidiaries), or the
past, present or future condition of any site or facility owned, operated or
leased by the Borrower or any of its Subsidiaries (or any such predecessor in
interest), or any Release or threatened Release of any Hazardous Materials from
any such site or facility, including any such Release or threatened Release
which shall occur during any period when the Administrative Agent or any Bank
shall be in possession of any such site or facility following the exercise by
the Administrative Agent or any Bank of any of its rights and remedies hereunder
or under any of the Security Documents other than any Release caused by the
gross negligence, bad faith or willful misconduct of the Administrative Agent or
any Bank or any agent, security agent or receiver acting on behalf of the
Administrative Agent or any Bank.

     

    
      
        
        

      

      
        101

        
          

        

      

      
        
        

      

    

    

    12.08  
 Survival.  The
obligations of the Obligors under Sections 2.03, 5.01, 5.04, 5.05, 5.06, 12.03 and 12.07 hereof, the
obligations of the Subsidiary Guarantors under Section 6.03 hereof
and the obligations of the Banks under Section 11.05 hereof
shall survive the repayment of the Loans and Reimbursement Obligations and the
termination of the Commitments.  In addition, each representation and
warranty made, or deemed to be made by a notice of any extension of credit
(whether by means of a Loan or a Letter of Credit), herein or pursuant hereto
shall survive the making of such representation and warranty, and no Bank shall
be deemed to have waived, by reason of making any extension of credit hereunder
(whether by means of a Loan or a Letter of Credit), any Default which may arise
by reason of such representation or warranty proving to have been false or
misleading, notwithstanding that such Bank or the Administrative Agent may have
had notice or knowledge or reason to believe that such representation or
warranty was false or misleading at the time such extension of credit was
made.

     

    12.09   
Captions.  The
table of contents and captions and section headings appearing herein are
included solely for convenience of reference and are not intended to affect the
interpretation of any provision of this Agreement.

     

    12.10  
 Counterparts.  This
Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument and any of the parties
hereto may execute this Agreement by signing any such counterpart, including by
facsimile or pdf (with an original subsequently delivered).

     

    12.11   
Governing Law;
Submission to Jurisdiction; Waiver of Immunity.  This Agreement
shall be governed by, and construed in accordance with, the law of the State of
New York.  Each Obligor hereby submits to the nonexclusive
jurisdiction of the United States District Court for the Southern District of
New York and of any New York state court sitting in The Borough of Manhattan,
New York City for the purposes of all legal proceedings arising out of or
relating to this Agreement or the transactions contemplated
hereby.  Each Obligor irrevocably waives, to the fullest extent
permitted by applicable law, any objection which it may now or hereafter have to
the laying of the venue of any such proceeding brought in such a court and any
claim that any such proceeding brought in such a court has been brought in an
inconvenient forum.  In addition, to the extent that any Obligor may
be entitled, in any jurisdiction in which judicial proceedings may at any time
be commenced with respect to this Agreement or any other Loan Document, to claim
for itself or its revenues, assets or properties any immunity from suit, the
jurisdiction of any court, attachment prior to judgment, attachment in aid of
execution of a judgment, set-off, execution of a judgment or any other legal
process, and to the extent that in any such jurisdiction there may be attributed
such immunity (whether or not claimed), such Obligor irrevocably agrees not to
claim and hereby irrevocably waives such immunity to the fullest extent
permitted by the laws of such jurisdiction and hereby agrees that the foregoing
waiver shall be enforced to the fullest extent permitted under the Foreign
Sovereign Immunities Act of 1976 of the United States of America, as amended,
and is intended to be irrevocable for the purpose of such Act.

    
      
         

      

      
        102

        
          

        

      

      
         

      

    

    12.12  
 Waiver of Jury
Trial.  EACH OF THE OBLIGORS, THE ADMINISTRATIVE AGENT, THE
BANKS AND THE ISSUING BANK HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.

     

    12.13   
Treatment of Certain
Information.

     

    (a)           Each
of the Banks and the Administrative Agent agrees (on behalf of itself and each
of its affiliates, directors, officers, employees and representatives) to keep
confidential, in accordance with their customary procedures for handling
confidential information of the same nature and in accordance with safe and
sound banking practices, any non-public information supplied by any Obligor or
any of its Subsidiaries pursuant to this Agreement; provided that nothing
herein shall limit the disclosure of any such information (i) to the extent
required by statute, rule, regulation or judicial process, (ii) to counsel for
any of the Banks or Administrative Agent, (iii) to bank examiners, auditors or
accountants, (iv) to the Administrative Agent or any other Bank, (v) in
connection with any litigation in respect of the Loan Documents to which any one
or more of the Banks or the Administrative Agent is a party or (vi) subject to
the terms of this Section 12.13(a), to
any assignee or participant (or prospective assignee or participant) or to any
actual or prospective counterparty (or its advisors) to any securitization, swap
or derivative transaction relating to the Obligors and the obligations created
or incurred under the Loan Documents; provided that such
assignee, participant or counterparty agrees to comply with this Section
12.13.

     

    (b)           In
the event a Bank or the Administrative Agent is required to disclose
confidential information pursuant to this Section 12.13, it
shall only disclose such information as it is legally required to disclose or it
would customarily disclose under similar circumstances to any Governmental
Authority (in each case, without requiring any additional consent from or the
giving of notice to any Obligor) and shall use reasonable efforts to obtain
confidential treatment for any information so disclosed.  In addition,
it shall if legally permitted promptly provide notice of the requirement to the
Borrower setting out the requirements and circumstances surrounding the required
disclosure and any other information it deems relevant so that the Borrower may
take any appropriate steps on behalf of itself and any Obligor to protect such
confidential information.

    
      
         

      

      
        103

        
          

        

      

      
         

      

    

    12.14   
Judgment
Currency.  This is an international loan transaction in which
the specification of US Dollars is of the essence, and the stipulated currency
shall in each instance be the currency of account and payment in all
instances.  A payment obligation in one currency hereunder (the “Original Currency”)
shall not be discharged by an amount paid in another currency (the “Other Currency”),
whether pursuant to any judgment expressed in or converted into any Other
Currency or in another place except to the extent that such tender or recovery
results in the effective receipt by the payee of the full amount of the Original
Currency payable by it under this Agreement.  If for the purpose of
obtaining judgment in any court it is necessary to convert a sum due hereunder
in the Original Currency into the Other Currency, the rate of exchange that
shall be applied shall be that at which in accordance with normal banking
procedures the Administrative Agent or any Bank hereunder could purchase
Original Currency with the Other Currency on the Business Day next preceding the
day on which such judgment is rendered.  The obligation of each
Obligor in respect of any such sum due from it to the Administrative Agent or
under any other Loan Document (in this Section 12.14 called
an “Entitled
Person”) shall, notwithstanding the rate of exchange actually applied in
rendering such judgment, be discharged only to the extent that on the Business
Day following receipt by such Entitled Person of any sum adjudged to be due
hereunder in the Other Currency such Entitled Person may in accordance with
normal banking procedures purchase and transfer the Original Currency to New
York with the amount of the judgment currency so adjudged to be due; and each
Obligor hereby, as a separate obligation and notwithstanding any such judgment,
agrees jointly and severally to indemnify such Entitled Person against, and to
pay such Entitled Person on demand, in the Original Currency, the amount (if
any) by which the sum originally due to such Entitled Person in the Original
Currency hereunder exceeds the amount of the Original Currency so purchased and
transferred.

     

    12.15  
 Agent for
Service of Process.  EACH OBLIGOR HEREBY IRREVOCABLY
DESIGNATES, APPOINTS AND EMPOWERS C T CORPORATION SYSTEM, 111 EIGHTH AVENUE, NEW
YORK, NEW YORK 10011, AS ITS DESIGNEE, APPOINTEE AND AGENT TO RECEIVE, FOR AND
ON ITS BEHALF, AND IN RESPECT OF ITS PROPERTY, SERVICE OF ANY AND ALL LEGAL
PROCESS, SUMMONS, NOTICES AND DOCUMENTS WHICH MAY BE SERVED IN ANY ACTION OR
PROCEEDING RELATING TO THE LOAN DOCUMENTS.  IF FOR ANY REASON SUCH
DESIGNEE, APPOINTEE AND AGENT SHALL CEASE TO BE AVAILABLE TO ACT AS SUCH, EACH
OBLIGOR, AGREES TO DESIGNATE A NEW DESIGNEE, APPOINTEE AND AGENT IN NEW YORK
CITY ON THE TERMS AND FOR THE PURPOSES OF THIS PROVISION SATISFACTORY TO THE
ADMINISTRATIVE AGENT.  EACH OBLIGOR AND THE ADMINISTRATIVE AGENT
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED
COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID TO THE ADMINISTRATIVE AGENT AND
SUCH OBLIGOR AT ITS RESPECTIVE ADDRESS REFERRED TO IN Section
12.02.

     

    12.16 
  Entire
Agreement.  This Agreement and the other Loan Documents
constitute the entire agreement among the parties with respect to the subject
matter of this Agreement and such other Loan Documents and supersede all prior
agreements and understandings, both oral and written, between the parties with
respect to the subject matter of this Agreement.

    
      
         

      

      
        104

        
          

        

      

      
         

      

    

    12.17 
  USA
PATRIOT Act Notice.  Each Bank and the Administrative Agent
(for itself and not on behalf of any Bank) hereby notifies the Obligors that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (the “Act”), it is required
to obtain, verify and record information that identifies each Obligor, which
information includes the name and address of each Obligor and other information
that will allow such Bank or the Administrative Agent, as applicable, to
identify such Obligor in accordance with the Act.  Each Obligor shall,
and shall cause each of its Subsidiaries to, provide, to the extent commercially
reasonable, such information and take such actions as are reasonably requested
by each Bank and the Administrative Agent to maintain compliance with the
Act.

     

    12.18 
  English
Language.  This Agreement has been negotiated and executed in
the English language.  All certificates, reports, notices and other
documents and communications given or delivered pursuant to this Agreement shall
be in the English language or, if not in English and if requested by the
Administrative Agent, accompanied by a certified English translation
thereof.  The English language version of any such document for
purposes of this Agreement shall control the meaning of the matters set forth
herein.

     

    12.19 
  Amended
and Restated Credit Agreement.  The parties hereto agree that,
on the date of this Agreement, this Agreement shall be deemed to amend, restate
and replace the Original Credit Agreement in its entirety.  Each
Obligor acknowledges and agrees that from and after the date of this Agreement,
(i) all Loan Documents (as defined in the Original Credit Agreement) shall
remain in full force and effect and shall be deemed to constitute Loan Documents
hereunder, (ii) all Loans made and outstanding pursuant to the Original Credit
Agreement shall be deemed to be Loans made under this Agreement, (iii) all
Letters of Credit issued pursuant to the Original Credit Agreement shall be
deemed to be Letters of Credit issued under this Agreement, (iv) each reference
in the Loan Documents (as defined in the Original Credit Agreement) to “Loans”, “Reimbursement
Obligations” and any other term defined in the Original Credit Agreement
shall be deemed to be a reference to such term as defined in this Agreement, and
(v) each reference in the Loan Documents (as defined in the Original Credit
Agreement) to the Original Credit Agreement shall be deemed to be a reference to
this Agreement (as amended, restated, replaced, supplemented or otherwise
modified from time to time).

     

    [Remainder of page left blank
intentionally]

    
      
         

      

      
        105

        
          

        

      

      
         

      

    

     

    IN WITNESS WHEREOF, the parties hereto
have caused this Agreement to be duly executed and delivered as of the day and
year first above written.

     

    
      
        
          
            	
                    BORROWER

                  
	 
	
                    GRAN
      TIERRA ENERGY CAYMAN ISLANDS INC.

                  
	 
	
                    By:

                  	
                    /s/ Martin Eden

                  
	 
      	
                    Name:
      Martin Eden

                  
	 
      	
                    Title:  
      Director

                  

          

        

      

    

     

    
      
        
          
            	
                    Address
      for Notices:

                  
	 
	
                    c/o
      Gran Tierra Energy Inc.

                  
	
                    300,
      611 10th Avenue SW

                  
	
                    Calgary,
      Alberta

                  
	
                    Canada
      T2R 0B2

                  
	
                    Attention:

                  	
                    Chief
      Financial Officer

                  
	
                    Tel:

                  	
                    (403)
      265 3221

                  
	
                    Fax:

                  	
                    (403)
      265 3242

                  
	
                    Email:

                  	
                    martineden@grantierra.com

                  

          

        

      

    

    

    Amended
and Restated Credit Agreement

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    
      
        
          	
                  ORIGINAL
      GUARANTORS

                
	 
	
                  GRAN
      TIERRA ENERGY COLOMBIA, LTD.

                
	
                  by
      Argosy Energy, LLC, its General Partner

                
	 
      	 
      
	
                  By:

                	
                  /s/ Edgar Louis Dyes

                
	 
      	
                  Name: 
      Edgar Louis Dyes

                
	 
      	
                  Title:   
      Manager

                

        

      

    

     

    
      
        
          
            
              
                
                  
                    
                      	
                              Address
      for Notices:

                            
	 
      
	
                              c/o
      Gran Tierra Energy Inc.

                            
	
                              300,
      611 10th Avenue SW

                            
	
                              Calgary,
      Alberta

                            
	
                              Canada
      T2R 0B2

                            
	
                              Attention:

                            	
                              Chief
      Financial Officer

                            
	
                              Tel:

                            	
                              (403)
      265 3221

                            
	
                              Fax:

                            	
                              (403)
      265 3242

                            
	
                              Email:

                            	
                              martineden@grantierra.com

                            

                    

                  

                

              

            

          

        

      

    

     

    
      
        
          	
                  ARGOSY
      ENERGY, LLC

                
	 
      	 
      
	
                  By:

                	
                  Edgar Louis Dyes

                
	 
      	
                  Name: 
      Edgar Louis Dyes

                
	 
      	
                  Title:   
      Manager

                

        

      

    

     

    
      
        
          	
                  Address
      for Notices:

                
	 
      
	
                  c/o
      Gran Tierra Energy Inc.

                
	
                  300,
      611 10th Avenue SW

                
	
                  Calgary,
      Alberta

                
	
                  Canada
      T2R 0B2

                
	
                  Attention:

                	
                  Chief
      Financial Officer

                
	
                  Tel:

                	
                  (403)
      265 3221

                
	
                  Fax:

                	
                  (403)
      265 3242

                
	
                  Email:

                	
                  martineden@grantierra.com

                

        

      

    

    

    Amended
and Restated Credit Agreement

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    
      
        	
                SOLANA
      PETROLEUM EXPLORATION (COLOMBIA) LIMITED

              
	 
      
	
                By:

              	
                /s/ Martin Eden

              
	 
      	
                Name: 
      Martin Eden

              
	 
      	
                Title:   
      Director and Treasurer

              

      

       

      
        
          
            
              
                
                  
                    
                      	
                              Address
      for Notices:

                            
	 
      
	
                              c/o
      Gran Tierra Energy Inc.

                            
	
                              300,
      611 10th Avenue SW

                            
	
                              Calgary,
      Alberta

                            
	
                              Canada
      T2R 0B2

                            
	
                              Attention:

                            	
                              Chief
      Financial Officer

                            
	
                              Tel:

                            	
                              (403)
      265 3221

                            
	
                              Fax:

                            	
                              (403)
      265 3242

                            
	
                              Email:

                            	
                              martineden@grantierra.com

                            

                    

                  

                

              

            

          

        

      

    

     

    
      
        
          
            	
                    SOLANA
      RESOURCES LIMITED

                  
	 
      	 
      
	
                    By:

                  	
                    /s/ Martin Eden

                  
	
                     

                  	
                    
                      Name:
      Martin Eden

                    

                  
	
                     

                  	
                    
                      Title:  
      Chief Financial Officer and
  Director

                    

                  

          

        

         

        
          
            
              
                
                  
                    
                      
                        	
                                Address
      for Notices:

                              
	 
      
	
                                c/o
      Gran Tierra Energy Inc.

                              
	
                                300,
      611 10th Avenue SW

                              
	
                                Calgary,
      Alberta

                              
	
                                Canada
      T2R 0B2

                              
	
                                Attention:

                              	
                                Chief
      Financial Officer

                              
	
                                Tel:

                              	
                                (403)
      265 3221

                              
	
                                Fax:

                              	
                                (403)
      265 3242

                              
	
                                Email:

                              	
                                martineden@grantierra.com

                              

                      

                    

                  

                

              

            

          

        

      

    

     

    Amended
and Restated Credit Agreement

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                	
                                        ARRANGER,
      ADMINISTRATIVE AGENT AND

                                        ISSUING
      BANK

                                      
	 
      
	
                                        STANDARD
      BANK PLC

                                      
	 
      
	
                                        By:

                                      	
                                        /s/ Martin Revoredo

                                      
	 	 
	Name:    
      Martin
      Revoredo
	Title:      
      Director
	 
      
	
                                        By:

                                      	
                                        /s/ Roderick L. Fraser

                                      
	 
      
	Name:  
        Roderick
      L. Fraser
	Title:      
      Global
      Head of Oil & Gas, Renewables
	 
      
	
                                        Address
      for Notices:

                                      
	 
      
	
                                        Standard
      Bank Plc

                                      
	
                                        c/o
      Standard Americas, Inc.

                                      
	
                                        Business
      Analytics & Transaction Management Group

                                      
	
                                        320
      Park Avenue, 19th Floor

                                      
	
                                        New
      York, NY 10022

                                      
	
                                        United
      States of America

                                      
	 
      
	
                                        Attention:
      Maria Ivulic

                                      
	
                                        Tel:
      +1 (212) 407 5164

                                      
	
                                        Fax:
      +1 (212) 407 5178

                                      
	
                                        Email:
      maria.ivulic@standardnewyork.com

                                      
	 
      
	
                                        With
      a copy to:

                                      
	 
      
	
                                        1211
      Avenue of the Americas

                                      
	
                                        New
      York, NY 10036

                                      
	
                                        United
      States of America

                                      
	
                                        Attention:  Jose
      Estanislao

                                      
	
                                        Tel:
      +1 (212) 407 5064

                                      
	
                                        Fax:
      +1 (212) 407 5178

                                      
	
                                        Email:
      jose.estanislao@standardny.com

                                      

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    

    Amended
and Restated Credit Agreement

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          	
                                  BANKS

                                
	 
      
	
                                  STANDARD
      BANK PLC

                                
	 
	
                                  By:

                                	
                                  /s/ Martin Revoredo

                                
	 	 
	Name:    
      Martin
      Revoredo
	Title:      
      Director
	 
      
	
                                  By:

                                	
                                  /s/ Roderick L. Fraser

                                
	 
      
	Name:    
      Roderick
      L. Fraser
	Title:      
      Global
      Head of Oil & Gas, Renewables
	 
      
	
                                  Address
      for Notices:

                                
	 
      
	
                                  Standard
      Bank Plc

                                
	
                                  c/o
      Standard Americas, Inc.

                                
	
                                  Business
      Analytics & Transaction Management Group

                                
	
                                  320
      Park Avenue, 19th Floor

                                
	
                                  New
      York, NY 10022

                                
	
                                  United
      States of America

                                
	 
      
	
                                  Attention:
      Maria Ivulic

                                
	
                                  Tel:
      +1 (212) 407 5164

                                
	
                                  Fax:
      +1 (212) 407 5178

                                
	
                                  Email:
      maria.ivulic@standardnewyork.com

                                
	 
      
	
                                  With
      a copy to:

                                
	 
      
	
                                  1211
      Avenue of the Americas

                                
	
                                  New
      York, NY 10036

                                
	
                                  United
      States of America

                                
	
                                  Attention:  Jose
      Estanislao

                                
	
                                  Tel:
      +1 (212) 407 5064

                                
	
                                  Fax:
      +1 (212) 407 5178

                                
	
                                  Email:
      jose.estanislao@standardny.com

                                

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    Amended and Restated
Credit Agreement

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    ANNEX
I

     

    BANKS
AND COMMITMENTS

     

    
      
        
          
            
              
                	
                        Bank

                      	 	
                        Amount of Commitment 

                        (as of the Closing Date)

                      	 
	
                        Standard
      Bank Plc

                      	 	$	7,000,000	 

              

            

          

        

      

    

    
      
         

      

      
        Annex
I-1

        
          

        

      

      
         

      

    

    ANNEX
II

     

    MANDATORY
COST FORMULA

     

    
      	
              1.

            	
              The
      Mandatory Cost is an addition to the interest rate to compensate Bank for
      the cost of compliance with (a) the requirements of the Bank of England
      and/or the Financial Services Authority (or, in either case, any other
      authority which replaces all or any of its functions) or (b) the
      requirements of the European Central
Bank.

            

    

     

    
      	
              2.

            	
              On
      the first day of each Interest Period (or as soon as possible thereafter)
      the Administrative Agent shall calculate, as a percentage rate, a rate
      (the “Additional Cost Rate”) for each Bank, in accordance with the
      paragraphs set out below.  The Mandatory Cost shall be
      calculated by the Administrative Agent as a weighted average of the Banks’
      Additional Cost Rates (weighted in proportion to the percentage
      participation of each Bank in the relevant Loan) and shall be expressed as
      a percentage rate per annum.

            

    

     

    
      	
              3.

            	
              The
      Additional Cost Rate for any Bank lending from an Applicable Lending
      Office in a Participating Member State shall be the percentage notified by
      that Bank to the Administrative Agent.  This percentage shall be
      certified by that Bank in its notice to the Administrative Agent to be its
      reasonable determination of the cost (expressed as a percentage of that
      Bank’s participation in all Loans made from such Applicable Lending
      Office) of complying with the minimum reserve requirements of the European
      Central Bank in respect of loans made from such Applicable Lending
      Office.

            

    

     

    
      	
              4.

            	
              The
      Additional Cost Rate for any Bank lending from an Applicable Lending
      Office in the United Kingdom shall be calculated by the Administrative
      Agent as follows:

            

    

     

    
      
        
          
            	
                      

                  	
                     percent
      per annum.

                  

          

        

      

    

     

    Where:

     

    
      	
               
      

            	
              E

            	
              is
      designed to compensate Banks for amounts payable under the Fees Rules and
      is calculated by the Administrative Agent as being the average of the most
      recent rates of charge supplied by the Reference Banks to the
      Administrative Agent pursuant to paragraph 6 below and expressed in pounds
      per £1,000,000.

            

    

     

    
      	
              5.

            	
              For
      the purposes of this Annex:

            

    

     

    
      	
               
      

            	
              (a)

            	
              “Special
      Deposits” has the meaning given to it from time to time under or
      pursuant to the Bank of England Act 1998 or (as may be appropriate) by the
      Bank of England;

            

    

    
      
         

      

      
        Annex
II-1

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              (b)

            	
              “Reference
      Banks” means the banks customarily referred to as reference banks
      for the purpose of calculating the Additional Cost Rate as determined by
      the Administrative Agent acting
reasonably;

            

    

     

    
      	
               
      

            	
              (c)

            	
              “Fees Rules”
      means the rules on periodic fees contained in the FSA Supervision Manual
      or such other law or regulation as may be in force from time to time in
      respect of the payment of fees for the acceptance of
    deposits;

            

    

     

    
      	
               
      

            	
              (d)

            	
              “Fee Tariffs”
      means the fee tariffs specified in the Fees Rules under the activity group
      A.1 Deposit acceptors (ignoring any minimum fee or zero rated fee required
      pursuant to the Fees Rules but taking into account any applicable discount
      rate);

            

    

     

    
      	
               
      

            	
              (e)

            	
              “Tariff Base”
      has the meaning given to it in, and shall be calculated in accordance
      with, the Fees Rules; and

            

    

     

    
      	
               
      

            	
              (f)

            	
              “Participating Member
      State” means any member state of the European Communities that
      adopts or has adopted the euro as its lawful currency in accordance with
      legislation of the European Community relating to Economic and Monetary
      Union.

            

    

     

    
      	
              6.

            	
              The
      Administrative Agent shall obtain from each Reference Bank as soon as
      practicable the rate of charge payable by that Reference Bank to the
      Financial Services Authority pursuant to the Fees Rules in respect of the
      relevant financial year of the Financial Services Authority (calculated
      for this purpose by that Reference Bank as being the average of the Fee
      Tariffs applicable to that Reference Bank for that financial year) and
      expressed in pounds per £1,000,000 of the Tariff Base of that Reference
      Bank.

            

    

     

    
      	
              7.

            	
              Each
      Bank shall supply any information required by the Administrative Agent for
      the purpose of calculating its Additional Cost Rate.  In
      particular, but without limitation, each Bank shall supply the following
      information on or prior to the date on which it becomes a
      Bank:

            

    

     

    
      	
               
      

            	
              (a)

            	
              the
      jurisdiction of its Applicable Lending Office;
  and

            

    

     

    
      	
               
      

            	
              (b)

            	
              any
      other information that the Administrative Agent may reasonably require for
      such purpose.

            

    

     

    Each Bank
shall promptly notify the Administrative Agent of any change to the information
provided by it pursuant to this paragraph.

    
      
         

      

      
        Annex
II-2

        
          

        

      

      
         

      

    

    
      	
              8.

            	
              The
      rates of charge of each Reference Bank for the purpose of “E” above shall
      be determined by the Administrative Agent based upon the information
      supplied to it pursuant to the paragraphs above and on the assumption
      that, unless a Bank notifies the Administrative Agent to the contrary,
      each Bank’s obligations in relation to cash ratio deposits and Special
      Deposits are the same as those of a typical bank from its jurisdiction of
      incorporation with an Applicable Lending Office in the same jurisdiction
      as its Applicable Lending Office.

            

    

     

    
      	
              9.

            	
              The
      Administrative Agent shall have no liability to any person if such
      determination results in an Additional Cost Rate which over or under
      compensates any Bank and shall be entitled to assume that the information
      provided by any Bank or Reference Bank pursuant to the paragraphs above is
      true and correct in all respects.

            

    

     

    
      	
              10.

            	
              The
      Administrative Agent shall distribute the additional amounts received as a
      result of the Mandatory Cost to the Banks on the basis of the Additional
      Cost Rate for each Bank based on the information provided by each Bank and
      each Reference Bank pursuant to the paragraphs
  above.

            

    

     

    
      	
              11.

            	
              Any
      determination by the Administrative Agent pursuant to this Annex in
      relation to a formula, the Mandatory Cost, an Additional Cost Rate or any
      amount payable to a Bank shall, in the absence of manifest error, be
      conclusive and binding on all
parties.

            

    

     

    
      	
              12.

            	
              The
      Administrative Agent may from time to time, after consultation with the
      Borrower and the Banks, determine and notify to all parties any amendments
      which are required to be made to this Annex in order to comply with any
      change in law, regulation or any requirements from time to time imposed by
      the Bank of England, the Financial Services Authority or the European
      Central Bank (or, in any case, any other authority which replaces all or
      any of its functions) and any such determination shall, in the absence of
      manifest error, be conclusive and binding on all
  parties.

            

    

    
      
         

      

      
        Annex
II-3

        
          

        

      

      
         

      

    

    SCHEDULE
I

     

    Offtakers

     

    
      	
              1.

            	
              Empresa
      Colombiana de Petróleos - Ecopetrol
S.A.

            

    

     

    
      	
              2.

            	
              Ecopetrol
      S.A.

            

    

     

    
      	
              3.

            	
              Surtigas
      S.A. E.S.P.

            

    

    
      
         

      

      
        Schedule
I-1

        
          

        

      

      
         

      

    

    SCHEDULE
II

     

    Liens

     

    1.           Farmout
Agreement between Solana Petroleum Exploration Colombia Limited and CEPSA
Colombia S.A. dated November 17, 2007 regarding Garibay Exploration and
Production Contract whereby upon the completion of certain conditions, Solana,
as Farmor, will have to open an escrow account in favor of CEPSA Colombia
S.A.

    

    2.           Otrosi Contrato de Obras,
Construcción y Trabajos para el pozo Búcaro-1 between Petroleum Equipment
Limitada, dated May 16, 2006, whereby Solana shall deposit in favor
of Petroleum Equipment Limitada, 10% of Solana’s net participation interest in
Yalea-1 well until the workover of Búcaro-1 well is paid.

    
      
         

      

      
        Schedule
II-1

        
          

        

      

      
         

      

    

    SCHEDULE
III

     

    Subsidiaries

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                	
                                                        No.

                                                      	 	
                                                        Name of Subsidiary 

                                                      	 	
                                                        Direct or

                                                        Indirect

                                                        Subsidiary

                                                      	 	
                                                        Jurisdiction of

                                                        Organization

                                                      	 	
                                                        Owner of Shares / Ownership

                                                        Percentage 

                                                      	 	
                                                        Type of

                                                        Subsidiary 

                                                      
	 	 	 	 	 	 	 	 	 	 	 
	
                                                        1.

                                                      	 	
                                                        GTE
      Colombia Holdings LLC

                                                      	 	
                                                        Direct

                                                      	 	
                                                        Delaware

                                                      	 	
                                                        Borrower

                                                        (Series
      1, 2 and 3)

                                                         

                                                        Gran
      Tierra Energy Inc.

                                                        (Series
      4, 5, 6, 7, 8 and  9)

                                                      	 	
                                                        Restricted

                                                      
	 	 	 	 	 	 	 	 	 	 	 
	
                                                        2.

                                                      	 	
                                                        Argosy
      Energy, LLC

                                                      	 	
                                                        Indirect

                                                         

                                                      	 	
                                                        Delaware

                                                      	 	
                                                        GTE
      Colombia Holdings LLC 

                                                        (100%)

                                                      	 	
                                                        Restricted

                                                      
	 	 	 	 	 	 	 	 	 	 	 
	
                                                        3.

                                                      	 	
                                                        Gran
      Tierra Energy Colombia, Ltd.

                                                      	 	
                                                        Indirect

                                                      	 	
                                                        Utah

                                                      	 	
                                                        GTE
      Colombia Holdings LLC

                                                        (99.2857%)

                                                         

                                                        Argosy
      Energy, LLC

                                                        (0.7143%)

                                                      	 	
                                                        Restricted

                                                      
	 	 	 	 	 	 	 	 	 	 	 
	
                                                        4.

                                                      	 	
                                                        Gran
      Tierra Energy Cayman Islands II Inc.

                                                      	 	
                                                        Direct

                                                      	 	
                                                        Cayman
      Islands

                                                      	 	
                                                        Borrower
      (100%)

                                                      	 	
                                                        Restricted

                                                      
	 	 	 	 	 	 	 	 	 	 	 
	
                                                        5.

                                                      	 	
                                                        Gran
      Tierra Energy Canada ULC

                                                      	 	
                                                        Indirect

                                                      	 	
                                                        Alberta

                                                      	 	
                                                        Gran
      Tierra Energy Cayman

                                                        Islands
      II Inc.

                                                        (100%)

                                                      	 	
                                                        Restricted

                                                      
	 	 	 	 	 	 	 	 	 	 	 
	
                                                        6.

                                                      	 	
                                                        Solana
      Petroleum Exploration (Colombia) Limited

                                                      	 	
                                                        N.A.

                                                      	 	
                                                        Cayman
      Islands

                                                      	 	
                                                        Solana
      Resources Limited

                                                        (100%)

                                                      	 	
                                                        Restricted

                                                      
	 	 	 	 	 	 	 	 	 	 	 
	
                                                        7.

                                                      	 	
                                                        Solana
      Resources Limited

                                                      	 	
                                                        N.A.

                                                      	 	
                                                        Alberta

                                                      	 	
                                                        Gran
      Tierra Exchangeco Inc.

                                                        (100%)

                                                      	 	
                                                        Restricted

                                                      

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    
      
         

      

      
        Schedule
III-1

        
          

        

      

      
         

      

    

    SCHEDULE
IV

    Capitalization

     

    
      	
              No.

            	 
      	
              Name of Company

            	 
      	
              Jurisdiction of

              Organization

            	 
      	
              Type of

              Subsidiary 

            	 
      	
              Issued

              Shares

            	 
      	
              Par

              Value

            	 
      	
              Owner of Shares /

              Ownership

              Percentage 

            
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
              1.

            	 
      	
              GTE
      Colombia Holdings LLC

            	 
      	
              Delaware

            	 
      	
              Restricted

            	 
      	
              N/A

            	 
      	
              N/A

            	 
      	
              Borrower

              (Series
      1, 2 and 3)

              Gran
      Tierra Energy Inc.

              (Series
      4, 5, 6, 7, 8 and  9)

            
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
              2.

            	 
      	
              Argosy
      Energy, LLC

            	 
      	
              Delaware

            	 
      	
              Restricted

            	 
      	
              N/A

            	 
      	
              N/A

            	 
      	
              GTE
      Colombia Holdings LLC (100%)

            
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
              3.

            	 
      	
              Gran
      Tierra Energy Colombia, Ltd.

            	 
      	
              Utah

            	 
      	
              Restricted

            	 
      	
              N/A

            	 
      	
              N/A

            	 
      	
              GTE
      Colombia 

              Holdings
      LLC

              (99.2857%)

               
      

              Argosy
      Energy, LLC

              (0.7143%)

            
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
              4.

            	 
      	
              Gran
      Tierra Energy Cayman Islands II Inc.

            	 
      	
              Cayman
      Islands

            	 
      	
              Restricted

            	 
      	
              1

            	 
      	
              US$1.00

            	 
      	
              Borrower

              (100%)

            
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
              5.

            	 
      	
              Gran
      Tierra Energy Canada ULC

            	 
      	
              Alberta

            	 
      	
              Restricted

            	 
      	
              100

            	 
      	
              N/A

            	 
      	
              Gran
      Tierra Energy 

              Cayman
      Islands II Inc.

              (100%)

            
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
              6.

            	 
      	
              Solana
      Petroleum Exploration (Colombia) Limited

            	 
      	
              Cayman
      Islands

            	 
      	
              Restricted

            	 
      	
              1448

            	 
      	
              US$1.00

            	 
      	
              Solana
      Resources 

              Limited

              (100%)

            
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
              7.

            	
                

            	
              Solana
      Resources Limited

            	
                

            	
              Alberta

            	
                

            	
              Restricted

            	
                

            	
              126,426,792

            	
                

            	
              N/A

            	
                

            	
              Gran
      Tierra 

              Exchangeco
      Inc.

              (100%)

            

    

    
      
         

      

      
        Schedule
IV-1

        
          

        

      

      
         

      

    

    SCHEDULE
V

     

    Environmental
Matters

     

    None.

     

    
      
         

      

      
        Schedule
V-1

        
          

        

      

      
         

      

    

    SCHEDULE
VI

     

    Offtake
Agreements

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          	
                                  Contract No.

                                	 
      	
                                  Offtake

                                  Agreements

                                  Regarding

                                	 
      	
                                  Block/Contract

                                	 
      	
                                  Parties

                                	 
      	
                                  Participation

                                  Interest*

                                	 
      	
                                  Termination

                                  Date

                                
	
                                  Contract
      No.

                                  VSM-GPS-011-2006
      (December 1, 2006)

                                   

                                  Addendum
      No. 1 (December 1, 2007)

                                   

                                  Addendum
      No. 2

                                  (May
      7, 2008)

                                	 
      	
                                  All
      crude produced in the Santana block and the Guayuyaco block owned by the
      Partnership

                                	 
      	
                                  Guayuyaco
      Association Agreement;

                                  Santana
      Risk Participation

                                  Contract

                                	 
      	
                                  Ecopetrol
      S.A. and the Partnership

                                	 
      	
                                  Guayuyaco
      block: 35%

                                   

                                  Santana
      block 35%

                                	 
      	
                                  July
      31, 2010

                                
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                  Contract
      No.

                                  VSM-GPS-011-2009

                                  (February
      12, 2009)

                                	 
      	
                                  All
      crude produced in Chaza block owned by the Partnership

                                	 
      	
                                  Chaza
      Exploration and Production Agreement

                                	 
      	
                                  Ecopetrol
      S.A. and the Partnership

                                	 
      	
                                  50%

                                	 
      	
                                  December
      31, 2009

                                
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                  Contract
      No.

                                  VSM-GPS-012-2009

                                  (February
      12, 2009)

                                	 
      	
                                  All
      crude produced in Chaza block owned by Solana Petroleum

                                	 
      	
                                  Chaza
      Exploration and Production Agreement

                                	 
      	
                                  Ecopetrol
      S.A. and Solana Petroleum

                                	 
      	
                                  50%

                                	 
      	
                                  December
      31, 2009

                                
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                  Contract
      No.

                                  VSM-GPS-013-2009

                                  (January
      12, 2009)

                                	
                                    

                                	
                                  All
      crude produced in the Guayuyaco block owned by Solana
      Petroleum|

                                	
                                    

                                	
                                  Guayuyaco
      Association Agreement

                                	
                                    

                                	
                                  Ecopetrol
      S.A. and Solana Petroleum

                                	
                                    

                                	
                                  35%

                                	
                                    

                                	
                                  December
      31,
2009

                                

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      	
              *

            	
              Participation
      interest before deductions of royalties and governmental rights, which
      deductions vary each month depending on the hydrocarbon production
      obtained.

            

    

     

    
      
         

      

      
        Schedule
VI-1

        
          

        

      

      
         

      

    

    SCHEDULE
VII

     

    Unrestricted
Subsidiaries

     

    None.

     

    
      
         

      

      
        Schedule
VII-1

        
          

        

      

      
         

      

    

    SCHEDULE
VIII

     

    Existing
Indebtedness

     

    None.

    
      
         

      

      
        Schedule
VIII-1

        
          

        

      

      
         

      

    

    SCHEDULE
IX

     

    Transactions with
Affiliates

     

    None.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    SCHEDULE
X

     

    Other Hydrocarbon
Properties

     

    Hydrocarbon
Properties that are the subject of the following exploration and production
contracts by Solana Petroleum:

    

    
      	
               
      

            	
              1.

            	
              Magangué
      Association Agreement executed with Ecopetrol S.A. (“Ecopetrol”) on
      December 5, 1989

            

    

    
      	
               
      

            	
              2.

            	
              Catguas
      Exploration and Production Agreement executed with the Agencia Nacional de
      Hidrocarburos (“ANH”) on
      November 17, 2005

            

    

    
      	
               
      

            	
              3.

            	
              San
      Pablo Exploration and Production Agreement executed with ANH on June 25,
      2007

            

    

    
      	
               
      

            	
              4.

            	
              Garibay
      Exploration and Production Agreement executed with ANH on October 25,
      2005

            

    

    
      	
               
      

            	
              5.

            	
              Chaza
      Exploration and Production Agreement executed with ANH on June 27,
      2005

            

    

    
      	
               
      

            	
              6.

            	
              Guayuyaco
      Association Agreement executed with Ecopetrol  on August 2,
      2002

            

    

    
      	
               
      

            	
              7.

            	
              Inchiyaco
      Commercial Agreement executed with the Partnership on March 26,
      2003

            

    

    

    Hydrocarbon
Properties that are the subject of the following exploration and production
contracts by the Partnership:

    

    
      	
               
      

            	
              1.

            	
              Putumayo
      Piedemonte Norte Exploration and Production Agreement executed with ANH on
      June 17, 2009

            

    

    
      	
               
      

            	
              2.

            	
              Putumayo
      Piedemonte Sur Exploration and Production Agreement executed with ANH on
      June 17, 2009

            

    

    
      	
               
      

            	
              3.

            	
              Rumiyaco
      Exploration and Production Agreement executed with ANH on June 5,
      2009

            

    

    
      	
               
      

            	
              4.

            	
              Mecaya
      Exploration and Production Agreement executed with ANH on June 14,
      2006

            

    

    
      	
               
      

            	
              5.

            	
              Rio
      Magdalena Association Agreement executed with Ecopetrol on December 10,
      2001

            

    

    
      	
               
      

            	
              6.

            	
              Azar
      Exploration and Production Agreement executed with ANH on October 12,
      2006

            

    

    
      	
               
      

            	
              7.

            	
              Guayuyaco
      Association Contract executed with Ecopetrol on August 2,
    2002

            

    

    
      	
               
      

            	
              8.

            	
              Santana
      Risk Participation Contract executed with Ecopetrol on July 27,
      1987

            

    

    
      	
               
      

            	
              9.

            	
              Talora
      Exploration and Production Agreement executed with ANH on September 16,
      2004

            

    

    
      	
               
      

            	
              10.

            	
              Chaza
      Exploration and Production Agreement executed with ANH on June 27,
      2005Unassociated Document

    Exhibit
10.3    

    

    FIRST
PRIORITY OPEN PLEDGE AGREEMENT OVER CREDIT RIGHTS DERIVED FROM HYDROCARBON
COMMERCIAL SALES AGREEMENTS

    

    
      	
               
      

            	
              1.

            	
              Edgar
      Louis Dyes of age, domiciled in the city of Bogota, identified with I.D.
      no. 223.325 issued in Bogota, acting on behalf of SOLANA PETROLEUM
      EXPLORATION COLOMBIA LIMITED (hereinafter the “PLEDGOR”), a
      corporation organized and existent under the laws of the Cayman Islands,
      in his capacity of [---], duly authorized to execute this Pledge
      Agreement, as evidenced in the PLEDGOR’s Board of Director’s Resolution
      dated August 24, 2009, a copy of which is here enclosed and is integral
      part of this Pledge Agreement, and;

            

    

    

    
      	
               
      

            	
              2.

            	
              Martin
      Revoredo and Roderick L. Fraser of age, acting in name and representation
      of STANDARD BANK PLC (hereinafter the “PLEDGEE”), a
      company duly organized and existent under the laws of England and Wales
      (Company No. 2130447) and having its registered office at Canon Bridge
      House, 25 Dowgate Hill, London EC4R 2SB, with main domicile in the United
      Kingdom, have executed the following Open Pledge Agreement (hereinafter
      the “Pledge
      Agreement”)  in their capacities as director and
      executive director:

            

    

     

    A.
WHEREAS an AMENDED AND RESTATED CREDIT AGREEMENT dated  August
24,  2009 (as amended, restated, supplemented or otherwise modified
from time to time, the “Credit Agreement”;
all capitalized terms used and not otherwise defined herein have the meanings
given to such terms in the Credit Agreement), was executed among GRAN TIERRA
ENERGY COLOMBIA, LTD (formerly Argosy Energy International), ARGOSY ENERGY LLC
(formerly Argosy Energy Corp.), a limited liability company organized under the
laws of the State of Delaware (Registered No. 3234977), the PLEDGOR, SOLANA
RESOURCES LIMITED, a limited company organized under the laws of Province of
Alberta, Canada, GRAN TIERRA ENERGY CAYMAN ISLANDS INC., a corporation organized
under the laws of the Cayman Islands (the “Borrower”), each of
the Banks party thereto from time to time; and STANDARD BANK PLC as Issuing
Bank, Arranger and as Administrative Agent (in such capacity, together with its
successors in such capacity, the “Administrative
Agent”) by means of which a loan facility for a sum of up to
US$200,000,000 was granted by the Banks to the Borrower on the terms and subject
to the conditions set forth therein

    

    B.
WHEREAS the PLEDGOR is a company dedicated to the exploration and production of
hydrocarbons in Colombia and in order to develop its corporate purpose has
established in Colombia a  branch denominated SOLANA PETROLEUM
EXPLORATION COLOMBIA LIMITED, located in Bogotá D.C., duly registered before
Bogotá’s Chamber of Commerce (hereinafter the “Branch”), as
evidenced in the certificate issued by said entity, which will be attached to
this Pledge Agreement and forms integral part thereof

    

    C.
WHEREAS for the fulfillment of its purpose, the PLEDGOR has and will enter into
different Hydrocarbon Commercial Sales Agreements (as defined
below);

    

    D.
WHEREAS in order to secure the prompt payment and performance in full of the
Secured Obligations, the Parties have agreed to execute this Pledge Agreement in
virtue of which the PLEDGOR hereby creates an open pledge, in favor of PLEDGEE,
over all rights described in the First Clause of this Pledge
Agreement.

    

    NOW,
THEREFORE, the parties agree to enter this Pledge Agreement governed by the
following clauses:

    

    FIRST CLAUSE. PURPOSE: PLEDGOR
hereby creates a first priority open pledge, in favor of PLEDGEE over all the
present and future rights, titles and interests of PLEDGOR or its Branch to
receivables and credits payable from time to time by the buyers under the Crude
Oil Commercial Sales Agreements executed until the moment of this Pledge, which
are listed and identified in Annex 1, and those entered into by the PLEDGOR or
its Branch in the future, but limited to those included in the definition of
“Offtake Agreements”
under the Credit Agreement (collectively, the “Hydrocarbon Commercial Sales
Agreements”).

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    The
pledge created hereunder, includes the rights of PLEDGOR or its Branch, directly
or indirectly to receive under the Hydrocarbon Commercial Sales Agreements any
of the following (collectively “Pledged Assets”): (i)
the full price of the hydrocarbons agreed between PLEDGOR and the buyers (ii)
all the default interest derived by the PLEDGOR from the Hydrocarbon Commercial
Sales Agreements, if any; (iii) all the fines, compensations or indemnifications
of any nature to which PLEDGOR may be entitled to by virtue of breaches of the
Hydrocarbon Commercial Sales Agreements; (iv) all the indemnifications paid by
insurance companies or banks, to which PLEDGOR is entitled to, derived from or
related to the Hydrocarbon Commercial Sales Agreements; and (v) all and any
other amounts to which PLEDGOR may be entitled to by virtue of the Hydrocarbon
Commercial Sales Agreements

    

    SECOND CLAUSE. SECURITY FOR OBLIGATIONS: The
pledge created by means of this Pledge Agreement is an open pledge, that secures
the payment and performance in full by the Obligors of all principal of and
interest on the Loans made by the Banks to, and the Notes held by each Bank
from, and Reimbursement Obligations in respect of Letters of Credit issued for
the account of, and the Designated Hedging Obligations of, the Borrower and all
other amounts from time to time owing to the Secured Parties by the Borrower
under the Credit Agreement, under the Notes, under each Designated Hedging
Agreement and by any other Obligor under any of the other Loan Documents to
which such Obligor is a party, in each case strictly in accordance with the
terms hereof and thereof (hereinafter the “Secured Obligations”).

    

    Notwithstanding
the above, the Parties hereto agree that the amount of the Secured Obligations
will correspond to the sum of up to USD$200,000,000 for principal plus any
interest and any other costs, expenses, fees, commissions, indemnifications and
other amounts due from any Obligor pursuant to the Credit Agreement and the
other Loan Documents.

    

    THIRD CLAUSE. COLLECTIONS: All
and any payments denominated in US Dollars to be made under the Hydrocarbon
Commercial Sales Agreements shall be made by the relevant buyers by means of
transference and deposit of those payments in the bank account named “---”,
Account Number [---], [Country]1, opened by PLEDGOR with
[---] Bank (the “
Collection Account”) to the fullest extent permitted under applicable
Colombian law.

    

     The
PLEDGEE will only be able to enforce the security granted under this Pledge
Agreement following the established procedures in Colombian legislation and any
other regulation, as well as any of the following events: (i) when an Event of
Default occurs, (ii) when a default occurs under this Pledge Agreement or (iii)
any representation or warranty made by the Pledgor under this Pledge Agreement
proves to be false, inaccurate or incorrect.

    

    FOURTH CLAUSE. SERVICES AND
INSTRUCTIONS: PLEDGOR shall notify in writing the buyers under the
Hydrocarbon Commercial Sales Agreements existing on the date of this Pledge
Agreement, within the three (3) working days following the date of execution of
this Pledge Agreement, in the manner indicated in Annex No. 2 to this Pledge
Agreement, that from the date on which this Pledge Agreement is entered into all
the rights of PLEDGOR to receive payments under the Hydrocarbon Commercial Sales
Agreements have been pledged in favor of PLEDGEE. Additionally, PLEDGOR shall
instruct irrevocably the buyers under the Hydrocarbon Commercial Sales
Agreements to make all the US Dollars payments derived from the Hydrocarbon
Commercial Sales Agreements, through a transfer and deposit of those payments in
the  Collection Account in accordance with the provisions of the
FOURTH CLAUSE.  Such instructions shall be irrevocable by the PLEDGOR
from and after the date of the issuance thereof unless otherwise agreed to by
the PLEDGEE.  For each Hydrocarbon Commercial Sales Agreement entered
into after the date of this Pledge Agreement, PLEDGOR shall similarly notify the
relevant buyer and the Collection Account bank in accordance with the procedures
set forth in the preceding provisions of this FOURTH CLAUSE regarding
Hydrocarbon Commercial Sales Agreements existing on the date of this Pledge
Agreement.

     

    
      
        

      

      1 The
account to be used as the US Collection account will be the same account opened
by Solana with BNP under the Solana / BNP credit agreement.

      

        
          
             

          

          
            2

            
              

            

          

          
             

          

        

      

    

    

    FIFTH CLAUSE. ADDITIONAL
OBLIGATIONS: In addition to the obligations stipulated in all other
clauses of this Pledge Agreement and in any applicable regulations, PLEDGOR
undertakes the following specific obligations: (i) be liable for the existence,
validity and duly and timely compliance with the Hydrocarbon Commercial Sales
Agreements, (ii) abstain from fully or partially assigning, selling,
transferring or executing any other type of agreement which will in any form
affect its participation in the Hydrocarbon Commercial Sales Agreements or the
rights derived there from without prior, specific and written authorization of
the PLEDGEE; (iii) promptly inform PLEDGEE about any breach of the Hydrocarbon
Commercial Sales Agreements regardless of its cause, by PLEDGOR or buyers; (iv)
maintain in force and without any liens or limitations all its rights under the
Hydrocarbon Commercial Sales Agreements other than Permitted Liens; and (v)
promptly inform PLEDGEE about any claim, lawsuit, seizure or precautionary
measure of any nature instituted or intended to be instituted by any person in
regards to the rights of PLEDGOR under the Hydrocarbon Commercial Sales
Agreements (vi) PLEDGOR is obliged to provide to PLEDGEE copy of all of the
Hydrocarbon Commercial Sales Agreements executed to date, or any future
Agreements executed, which are pledged under this Pledge Agreement, within the
following two (2) working days of the execution of this Pledge Agreement, or
within the following two (2) working days from the execution of the Hydrocarbon
Commercial Sales Agreement, as applicable as well as to keep the documents in
the offices located in Bogota D.C. (vii) not to modify, amend or renegotiate the
instructions and the form of payment under the Hydrocarbon Commercial Sales
Agreements, unless such re negotiation increases, in US Dollars, the returned
percentages; consequently the amendments to the Hydrocarbon Commercial sales
agreements may not increase the returned percentage in Colombian
pesos.

    

    SIXTH CLAUSE. TERM: This
Pledge Agreement will have the same term as the Credit Agreement, which is until
February 22, 2010, or any of its extensions in accordance to the Credit
Agreement. However, this pledge will serve as a security for the Secured
Obligations until they are cancelled in full. Once all of the Secured
Obligations have been paid or discharged in full, the PLEDGOR will be entitled,
at its sole cost and expense, to receive from the PLEDGEE the execution of a
document canceling the pledge created under this Pledge Agreement; provided always that
if any payment in respect of the Secured Obligations is avoided or reduced as a
result of the insolvency of the PLEDGOR or any analogous event, such pledge
shall to the fullest extent permitted by law be reinstated as if the payment and
discharge of the Secured Obligations had not occurred, and the liability of the
PLEDGOR will continue as if the payment in respect of the Secured Obligations
had not occurred, and the PLEDGEE shall be entitled to recover the amount of
such payment from the PLEDGOR as if such payment had not been made.

    

    SEVENTH  CLAUSE.
REPRESENTATIONS AND WARANTEES: PLEDGOR hereby represents and warrants in
favor of the PLEDGEE, the following:

    

    
      	
               
      

            	
              (i)

            	
              That
      all the rights of PLEDGOR under the Hydrocarbon Commercial Sales
      Agreements are of its exclusive property, have not been previously
      assigned or transferred and are free from any seizures, pledges, lawsuits,
      and in general from any other types of liens and limitations to ownership
      other than Permitted Liens.

            

    

    

    
      	
               
      

            	
              (ii)

            	
              That
      each of the Hydrocarbon Commercial Sales Agreements is valid and binding
      upon each of PLEDGOR and the buyers and enforceable against each of them,
      in accordance with the terms and conditions stipulated
      therein.

            

    

     

    
      	
               
      

            	
              (iii)

            	
              That
      PLEDGOR has no knowledge of any fact or event that could imply or produce
      a breach of the Hydrocarbon Commercial Sales
  Agreements.

            

    

    

    
      	
               
      

            	
              (iv)

            	
              That
      it is legally empowered to enter into and perform this Pledge Agreement
      and that for its execution and performance there are no legal, contractual
      or statutory restrictions applicable to
PLEDGOR

            

    

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    
      	
               
      

            	
              (v)

            	
              That
      all the actions and conditions (statutory or of any other type) required
      for the execution and performance of this Pledge Agreement, have been duly
      and fully obtained, performed, fulfilled with and
    satisfied.

            

    

    

    
      	
               
      

            	
              (vi)

            	
              That
      this Pledge Agreement creates valid and binding obligations upon PLEDGOR
      enforceable against it, according to the terms and conditions provided
      herein.

            

    

    

    
      	
               
      

            	
              (vii)

            	
              That
      except for the authorizations already received, the entering into and
      perfecting of this Pledge Agreement as well as its compliance and
      performance, does not breach or imply a non-compliance, neither requires
      any consent or authorization under: (a) the constituent documents of
      PLEDGOR; (b) any law, decree, resolution, agreement, order, judicial
      decision, writ, administrative decision, license or permit applicable to
      PLEDGOR or to which PLEDGOR is bound, or (c) any contract or document to
      which PLEDGOR is a party or is
obligated.

            

    

    

    EIGHTH CLAUSE. EXPENSES AND
TAXES: All the expenses and taxes that may be caused or derived from the
execution and compliance of this Pledge Agreement shall be fully assumed and
paid by PLEDGOR. Moreover, the PLEDGEE represents, warrants and declares that
this Pledge Agreement requires no registration before any authority in
Colombia.

    

    NINTH CLAUSE. COSTS AND FEES:
The expenses and costs to be incurred by PLEDGEE in case this pledge is
made effective, including lawyer’s fees, will be fully assumed by
PLEDGOR.

    

    TENTH CLAUSE. APPLICABLE LAW:
This Pledge Agreement is governed by, and shall be construed and
interpreted in accordance with, the laws of the Republic of
Colombia.

    

    ELEVENTH CLAUSE. USE OF SPANISH LANGUAGE: The
Spanish text of this Pledge Agreement shall be controlling in all
cases,.

    

    TWELFTH CLAUSE. NOTICES: Any
message, notification or summon required, demanded or permitted by this Pledge
Agreement to be delivered to PLEDGOR or PLEDGEE shall be made in writing and
shall be given in accordance with Section 12.02 of the Credit
Agreement:

    

    THIRTEENTH
CLAUSE. MISCELLANEOUS:

    
      

    

    
      
        	
                (a)

              	
                Each
      agreement, representation, warranty, and covenant contained or referred to
      in this Pledge Agreement shall survive any investigation at any time made
      by the PLEDGOR and shall survive any disbursement under the loans, except
      for changes permitted hereby and, except as otherwise provided in this
      article, shall terminate only when all amounts due or to become due under
      the Credit Agreement are indefeasibly
paid.

              

      

    

    
      

    

    
      
        	
                (b)

              	
                The
      meanings given to terms defined herein shall be equally applicable to both
      the singular and plural forms of such
terms.

              

      

    

    
      

    

    
      
        	
                (c)

              	
                No
      failure or delay by PLEDGEE in exercising any right, power, or remedy
      shall operate as a waiver thereof or otherwise impair any of its other
      rights, powers, or remedies. No single or partial exercise of any such
      right, power, or remedy shall preclude any other or further exercise
      thereof or the exercise of any other legal right, power, or remedy. No
      waiver of any right, power, or remedy by PLEDGEE shall be effective unless
      given in writing by PLEDGEE.

              

      

    

    
      

    

    
      
        	
                (d)

              	
                If
      any provision, term, obligation or prohibition of this Pledge Agreement is
      held to be invalid, illegal, or unenforceable in any jurisdiction, then to
      the fullest extent permitted by law, such invalidity, illegality, or
      unenforceability shall not affect the validity, legality, and
      enforceability of the other provisions of this Pledge Agreement and shall
      not render such provision prohibited, invalid, illegal, or unenforceable
      in any other jurisdiction. Moreover the aforementioned provision, term,
      obligation or prohibition  can only be modified in case in which
      it is strictly necessary for the performance of the agreement in
      accordance with the intention of the
parties.

              

      

    

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    
      

    

    
      
        	
                (e)

              	
                This
      Pledge Agreement and the other Loan Documents embodies the entire
      understanding of the Parties and supersedes all prior negotiations,
      understandings, and agreements between them with respect to the subject
      matter hereof. The provisions of this Pledge Agreement and of its Annexes
      may be waived, supplemented, or amended only by an instrument in writing
      signed by the Parties hereto.

              

      

    

    
      

    

    
      
        	
                (f)

              	
                This
      Pledge Agreement may only be amended by written consent, duly signed by
      the Parties’ authorized
representatives.

              

      

    

    

    In
witness whereof, this Agreement is signed in multiple original copies, of the
same contents on August 24, 2009 by:

    

    SOLANA
PETROLEUM EXPLORATION COLOMBIA LIMITED

    

    Firma:  /s/ Edgar Louis
Dyes                       

    Nombre: Edgar
Louis Dyes

    C.E.:        223.325

    Poisicion:
Representante Legal Principal

    

    STANDARD
BANK PLC

    

    
      
        	
                By:

              	
                /s/ Martin Revoredo

              
	
                Name:

              	
                Martin
      Revoredo

              
	
                Title:

              	
                Director

              
	 
      	 
      
	
                By:

              	
                /s/ Roderick L. Fraser

              
	
                Name:

              	
                 
          Roderick L. Fraser

              
	
                Title:

              	
                   
      Global Head of Oil & Gas,
Renewables

              

      

    

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    

    ANNEX
1

    HYDROCARBON
PURCHASE AGREEMENTS

    SOLANA
PETROLEUM EXPLORATION (COLOMBIA) LIMITED

     

    
      
        
          
            
              	
                      PURPOSE

                    	 
      	
                      BLOCK/

                      CONTRACT

                    	 
      	
                      PARTIES

                    	 
      	
                      NET PARTICIPATION OF

                      SOLANA

                    	 
      	
                      EXECUTION DATE

                    	 
      	
                      TERMINATION DATE

                    
	
                      Hydrocarbons
      produced in the Chaza block.

                    	 
      	
                      Chaza

                    	 
      	
                      Ecopetrol  S.A.
      / Solana

                    	 
      	
                      50%

                    	 
      	
                      February
      12, 2009

                    	 
      	
                      December
      31, 2009

                    
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                      Hydrocarbons
      produced in the Inchiyaco-1 well and in Guayuyaco Association
      Contract.

                    	
                        

                    	
                      Association
      Contract Guayuyaco

                    	
                        

                    	
                      Ecopetrol
      S.A. / Gran Tierra Energy Limited

                    	
                        

                    	
                      35%

                    	
                        

                    	
                      January
      12, 2009

                    	
                        

                    	
                      December
      31, 2009

                    

            

          

        

      

    

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    

    ANNEX NO.
2

    

    FORM OF
NOTIFICATIONS AND INSTRUCTIONS TO [BUYER] AND ANY OTHER OFFTAKER PURCHASING
HYDROCARBONS FROM SOLANA PETROLEUM EXPLORATION COLOMBIA LIMITED

    

    Bogotá,
_________of _________ 2009

    

    Messrs.

    [BUYER]

    Attention:
(           )

    (Address)

    

    Dear
sirs:

    

    We refer
to the Hydrocarbon Commercial Sales Agreement entered into by between SOLANA
PETROLEUM EXPLORATION COLOMBIA LIMITED and [buyer], on [month] [day] of
[year].

    

    We are
hereby notifying you that by virtue of a pledge agreement entered into on
_____________ of 2009 by SOLANA PETROLEUM EXPLORATION COLOMBIA LIMITED, a
corporation organized and existent in accordance to the laws of the Cayman
Islands (hereinafter the “PLEDGOR”) and STANDARD BANK PLC a company organized
and existent in accordance to the laws of England and Wales a first priority
open pledge over all the rights of PLEDGOR to receive payments under the
Hydrocarbon Commercial Sales Agreement referred in the first paragraph
above.

    

    The above
referred pledge includes all the rights of the PLEDGOR to receive price,
interests, fines, indemnifications or compensations of any nature, and other
credit rights derived from the Hydrocarbon Commercial Sales
Agreement.

    

    In
conformity with the mentioned pledge, we are irrevocably instructing [BUYER] to
deposit all and any amounts to which the PLEDGOR may be entitled to under or as
consequence of the Hydrocarbon Commercial Sales Agreement paid in US Dollars, in
the bank account named [“---”], Account Number [---], maintained with STANDARD
BANK PLC in [---], [---], [COUNTRY] (the “Collection Account”) to the fullest
extent permitted under applicable Colombian law; and

    

    For the
avoidance of doubt, the instructions granted by the PLEDGOR by virtue of this
communication are irrevocable and can only be amended or modified with the
express prior consent of the PLEDGEE.

    

    Please
return a copy of this letter, duly signed in sign of acceptance.

    

    Best
regards,

    

    SOLANA
PETROLEUM EXPLORATION COLOMBIA LIMITED

    

    _________________________

    

    Name:

    ID:

    Title:

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    

    Served
upon and accepted:

    

    [BUYER]
..

    

    ________________________

    

    Name:

    ID:

    Title:

    
      
         

      

      
        8

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