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American Natural Energy Corporation  - Exhibit 10.2 - Filed by newsfilecorp.com

Exhibit 10.2 

NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS
SECURITY IS CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO
AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY
ACCEPTABLE TO THE COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON
CONVERSION OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES. 

Original Issue Date: August 13, 2012 
Original Conversion
Price (subject to adjustment herein): $0.10 

$2,000,000.00 

12% CONVERTIBLE DEBENTURE 
DUE AUGUST 13, 2014 

          THIS
12% CONVERTIBLE DEBENTURE is one of a series of duly authorized and validly
issued 12% Convertible Debentures of American Natural Energy Corporation, a
Nevada corporation (the “Company”), having its principal place of
business at 6100 South Yale, Suite 2010, Tulsa, Oklahoma 74136, designated as
its 12% Convertible Debenture due August 13, 2014 (this debenture, the
“Debenture” and, collectively with the other debentures of such series,
the “Debentures”). 

          FOR
VALUE RECEIVED, the Company promises to pay to Palo Verde Acquisitions, LLC or
its registered assigns (the “Holder”), or shall have paid pursuant to the
terms hereunder, the principal sum of TWO MILLION DOLLARS US $2,000,000.00
on August 13, 2014 (the “Maturity Date”) or such earlier date as this
Debenture is required or permitted to be repaid as provided hereunder. Except as
otherwise set forth in this Debenture, the Company may not prepay any portion of
the principal amount of this Debenture without the prior written consent of the
Holder. This Debenture is subject to the following additional provisions: 

Section 1.     
Definitions. For the purposes hereof, in addition to the terms defined
elsewhere in this Debenture, (a) capitalized terms not otherwise defined herein
shall have the meanings set forth in the Purchase Agreement and (b) the
following terms shall have the following meanings: 

          “Affiliate”
means any Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common control with a
Person, as such terms are used in and construed under Rule 405 under the
Securities Act. 

          “Alternate
Consideration” shall have the meaning set forth in Section 5(e). 

          “Bankruptcy
Event” means any of the following events: (a) the Company or any Significant
Subsidiary (as such term is defined in Rule 1-02(w) of Regulation S-X) thereof
commences a case or other proceeding under any bankruptcy, reorganization,
arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or
liquidation or similar law of any jurisdiction relating to the Company or any
Significant Subsidiary thereof, (b) there is commenced against the Company or
any Significant Subsidiary thereof any such case or proceeding that is not
dismissed within 60 days after commencement, (c) the Company or any Significant
Subsidiary thereof is adjudicated insolvent or bankrupt or any order of relief
or other order approving any such case or proceeding is entered, (d) the Company
or any Significant Subsidiary thereof suffers any appointment of any custodian
or the like for it or any substantial part of its property that is not
discharged or stayed within 60 calendar days after such appointment, (e) the
Company or any Significant Subsidiary thereof makes a general assignment for the
benefit of creditors, (f) the Company or any Significant Subsidiary thereof
calls a meeting of its creditors with a view to arranging a composition,
adjustment or restructuring of its debts or (g) the Company or any Significant
Subsidiary thereof, by any act or failure to act, expressly indicates its
consent to, approval of or acquiescence in any of the foregoing or takes any
corporate or other action for the purpose of effecting any of the foregoing.

          “Base
Conversion Price” shall have the meaning set forth in Section 4(b). 

          “Beneficial
Ownership Limitation” shall have the meaning set forth in Section 4(d).

          “Business
Day” means any day except any Saturday, any Sunday, any day which is a
federal legal holiday in the United States or any day on which banking
institutions in the State of Oklahoma are authorized or required by law or other
governmental action to close. 

          “Conversion”
shall have the meaning ascribed to such term in Section 4. 

          “Conversion
Date” shall have the meaning set forth in Section 4(a). 

          “Conversion
Price” shall have the meaning set forth in Section 4(b). 

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          “Conversion
Schedule” means the Conversion Schedule in the form of Schedule 1
attached hereto. 

          “Conversion
Shares” means, collectively, the shares of Common Stock issuable upon
conversion of this Debenture in accordance with the terms hereof. 

          “Debenture
Register” shall have the meaning set forth in Section 3(b). 

          “Dilutive
Issuance” shall have the meaning set forth in Section 5(b). 

          “Dilutive
Issuance Notice” shall have the meaning set forth in Section 5(b). 

          “Event
of Default” shall have the meaning set forth in Section 6(a). 

          “Notice
of Conversion” shall have the meaning set forth in Section 4(a). 

          “Original
Issue Date” means the date of the first issuance of the Debentures,
regardless of any transfers of any Debenture and regardless of the number of
instruments which may be issued to evidence such Debentures. 

          
“Purchase Agreement” means the Securities Purchase Agreement, dated as of
August 13, 2012 among the Company and the original Holder, as amended, modified
or supplemented from time to time in accordance with its terms. 

          “Securities
Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder. 

          “Share
Delivery Date” shall have the meaning set forth in Section 4(c)(ii). 

          “Trading
Day” means a day on which the principal Trading Market is open for trading.

          “Trading
Market” means any of the following markets or exchanges on which the Common
Stock is listed or quoted for trading on the date in question: the TSX Venture
Exchange, NYSE AMEX, the Nasdaq Capital Market, the Nasdaq Global Market, the
Nasdaq Global Select Market, the New York Stock Exchange, the OTC Bulletin
Board, or the “Pink Sheets” published by Pink OTC Markets, Inc. (or any
successors to any of the foregoing). 

          “VWAP”
means, for any date, the price determined by the first of the following clauses
that applies: (a) if the Common Stock is then listed or quoted on a Trading
Market, the daily volume weighted average price of the Common Stock for such
date (or the nearest preceding date) on the Trading Market on which the Common
Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading
Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)
if the OTC Bulletin Board is not a Trading Market, the volume weighted average
price of the Common Stock for such date (or the nearest preceding date) on the OTC
Bulletin Board, (c) if the Common Stock is not then listed or quoted for trading
on the OTC Bulletin Board and if prices for the Common Stock are then reported
in the “Pink Sheets” published by Pink OTC Markets, Inc. (or a similar
organization or agency succeeding to its functions of reporting prices), the
most recent bid price per share of the Common Stock so reported, or (d) in all
other cases, the fair market value of a share of Common Stock as determined by
an independent appraiser selected in good faith by the Purchasers of a majority
in interest of the Securities then outstanding and reasonably acceptable to the
Company, the fees and expenses of which shall be paid by the Company. 

3

Section 2.     
Interest. The Company hereby promises to pay to the Holder, interest on
the outstanding principal amount under this Debenture at a rate of twelve
percent (12%) per annum simple interest on a quarterly basis from the date of
the original issue until paid in full, or converted pursuant to the provision of
Section 4. Interest is payable in immediately available lawful money of the
United States of America or in shares of common stock of the Company, at the
election of the Company. Common shares shall be valued at the average VWAP for
the preceding five (5) trading days prior to such interest payment. 

Section
3.      Registration of Transfers and
Exchanges.

          a)           Investment
Representations. This Debenture has been issued subject to certain
investment representations of the original Holder set forth in the Purchase
Agreement and may be transferred or exchanged only in compliance with the
Purchase Agreement and applicable federal and state securities laws and
regulations.

          b)          
Reliance on Debenture Register. Prior to due presentment to the Company
of this Debenture for transfer, the Company and any agent of the Company may
treat the Person in whose name this Debenture is duly registered on the records
of the Company regarding registration and transfers of this Debenture (the
“Debenture Register”) as the owner hereof for the purpose of receiving
payment as herein provided and for all other purposes, whether or not this
Debenture is overdue, and neither the Company nor any such agent shall be
affected by notice to the contrary. 

Section
4.      Conversion. 

          a)          
Voluntary Conversion. At any time after the Original Issue Date until
this Debenture is no longer outstanding, this Debenture shall be convertible, in
whole or in part, into shares of Common Stock at the option of the Holder, at
any time and from time to time (subject to the conversion limitations set forth
in Section 4(d) hereof). The Holder shall effect conversions by delivering to
the Company a Notice of Conversion, the form of which is attached hereto as
Annex A (each, a “Notice of Conversion”), specifying therein the
principal amount of this Debenture to be converted and the date on which such
conversion shall be effected (such date, the “Conversion Date”). If
no Conversion Date is specified in a Notice of Conversion, the Conversion Date
shall be the date that such Notice of Conversion is deemed delivered hereunder.
To effect conversions hereunder, the Holder shall
not be required to physically surrender this Debenture to the Company unless the
entire principal amount of this Debenture has been so converted. Conversions
hereunder shall have the effect of lowering the outstanding principal amount of
this Debenture in an amount equal to the applicable conversion. The Holder and
the Company shall maintain records showing the principal amount(s) converted and
the date of such conversion(s). The Company may deliver an objection to any
Notice of Conversion within five (5) Business Days of delivery of such Notice of
Conversion.

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          b)           Conversion
Price. The conversion price in effect on any Conversion Date shall be equal
to $0.10, subject to adjustment herein (the “Conversion Price”).

          c)          
Mechanics of Conversion. 

          i.     
Conversion Shares Issuable Upon Conversion of Principal Amount.
The number of Conversion Shares issuable upon a conversion hereunder shall be
determined by the quotient obtained by dividing (x) the outstanding principal
amount of this Debenture to be converted by (y) the Conversion Price. 

          ii.      Delivery
of Certificate Upon Conversion. Not later than three (3) Trading Days after
each Conversion Date (the “Share Delivery Date”), the Company shall
deliver, or cause to be delivered, to the Holder (A) a certificate or
certificates representing the Conversion Shares which, on or after the earlier
of (i) the six month anniversary of the Original Issue Date or (ii) the
Effective Date, shall be free of restrictive legends and trading restrictions
(other than those which may then be required by the Purchase Agreement)
representing the number of Conversion Shares being acquired upon the conversion
of this Debenture. On or after the earlier of (i) the six month anniversary of
the Original Issue Date or (ii) the Effective Date, the Company shall use its
best efforts to deliver any certificate or certificates required to be delivered
by the Company under this Section 4(c) electronically through the Depository
Trust Company or another established clearing corporation performing similar
functions. 

          iii.     
Reservation of Shares Issuable Upon Conversion. The Company covenants
that it will at all times reserve and keep available out of its authorized and
unissued shares of Common Stock for the sole purpose of issuance upon conversion
of this Debenture, each as herein provided, free from preemptive rights or any
other actual contingent purchase rights of Persons other than the Holder (and
the other holders of the Debentures), not less than such aggregate number of
shares of the Common Stock as shall (subject to the terms and conditions set
forth in the Purchase Agreement) be issuable (taking into account the
adjustments and restrictions of Section 5) upon the conversion of the then
outstanding principal amount of this Debenture. The Company covenants that all
shares of Common Stock that shall be so issuable shall, upon issue, be duly
authorized, validly issued, fully paid and nonassessable.

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          iv.     
Fractional Shares. No fractional shares or scrip representing fractional
shares shall be issued upon the conversion of this Debenture. As to any fraction
of a share which the Holder would otherwise be entitled to purchase upon such
conversion, the Company shall at its election, either pay a cash adjustment in
respect of such final fraction in an amount equal to such fraction multiplied by
the Conversion Price or round up to the next whole share. 

          d)          
Holder’s Conversion Limitations. The Company shall not effect any
conversion of this Debenture, and a Holder shall not have the right to convert
any portion of this Debenture, to the extent that after giving effect to the
conversion set forth on the applicable Notice of Conversion, the Holder
(together with the Holder’s Affiliates, and any Persons acting as a group
together with the Holder or any of the Holder’s Affiliates) would beneficially
own in excess of the Beneficial Ownership Limitation (as defined below). For
purposes of the foregoing sentence, the number of shares of Common Stock
beneficially owned by the Holder and its affiliates shall include the number of
shares of Common Stock issuable upon conversion of this Debenture with respect
to which such determination is being made, but shall exclude the number of
shares of Common Stock which are issuable upon (i) conversion of the remaining,
unconverted principal amount of this Debenture beneficially owned by the Holder
or any of its Affiliates and (ii) exercise or conversion of the unexercised or
unconverted portion of any other securities of the Company subject to a
limitation on conversion or exercise analogous to the limitation contained
herein (including, without limitation, any other Debentures or the Warrants)
beneficially owned by the Holder or any of its affiliates. Except as set forth
in the preceding sentence, for purposes of this Section 4(d), beneficial
ownership shall be calculated in accordance with Section 13(d) of the Exchange
Act and the rules and regulations promulgated thereunder. In addition, a
determination as to any group status as contemplated above shall be determined
in accordance with Section 13(d) of the Exchange Act and the rules and
regulations promulgated thereunder. For purposes of this Section 4(d), in
determining the number of outstanding shares of Common Stock, the Holder may
rely on the number of outstanding shares of Common Stock as stated in the most
recent of the following: (i) the Company’s most recent periodic or annual report
filed with the Commission, as the case may be, (ii) a more recent public
announcement by the Company, or (iii) a more recent written notice by the
Company or the Company’s transfer agent setting forth the number of shares of
Common Stock outstanding. Upon the written or oral request of a Holder, the
Company shall within five (5) Trading Days confirm orally and in writing to the
Holder the number of shares of Common Stock then outstanding. In any case, the
number of outstanding shares of Common Stock shall be determined after giving
effect to the conversion or exercise of securities of the Company, including
this Debenture, by the Holder or its Affiliates since the date as of which such
number of outstanding shares of Common Stock was reported. The
“Beneficial Ownership Limitation” shall be no more than 19.9% of
the number of shares of the Common Stock outstanding immediately after giving
effect to the issuance of shares of Common Stock issuable upon conversion of
this Debenture held by the Holder or group of Holders, unless approved by the
shareholders. The Beneficial Ownership Limitation provisions of this paragraph shall be
construed and implemented in a manner otherwise than in strict conformity with
the terms of this Section 4(d) to correct this paragraph (or any portion hereof)
which may be defective or inconsistent with the intended Beneficial Ownership
Limitation contained herein or to make changes or supplements necessary or
desirable to properly give effect to such limitation. The limitations contained
in this paragraph shall apply to a successor holder of this Debenture. 

6

               e)          
Shareholder Vote to Approve Conversion Amounts above the Beneficial
Ownership Limitation. The Company and its Board of Directors shall use
their best efforts to seek the approval of the Company’s shareholders to allow
conversion of all Debentures owned by Holder at the next shareholders meeting. A
shareholders meeting will be called during the fall of 2012.

Section 5.      Certain
Adjustments. 

               a)          
Stock Dividends and Stock Splits. If the Company, at any time while this
Debenture is outstanding: (i) pays a stock dividend or otherwise makes a
distribution or distributions payable in shares of Common Stock on shares of
Common Stock or any Common Stock Equivalents (which, for avoidance of doubt,
such payment or distribution shall not include any shares of Common Stock issued
by the Company upon conversion of the Debentures), (ii) subdivides outstanding
shares of Common Stock into a larger number of shares, (iii) combines (including
by way of a reverse stock split) outstanding shares of Common Stock into a
smaller number of shares or (iv) issues, in the event of a reclassification of
shares of the Common Stock, any shares of capital stock of the Company, then the
Conversion Price shall be multiplied by a fraction of which the numerator shall
be the number of shares of Common Stock (excluding any treasury shares of the
Company) outstanding immediately before such event, and of which the denominator
shall be the number of shares of Common Stock outstanding immediately after such
event. Any adjustment made pursuant to this Section shall become effective
immediately after the record date for the determination of stockholders entitled
to receive such dividend or distribution and shall become effective immediately
after the effective date in the case of a subdivision, combination or
re-classification. 

               b)          
Subsequent Equity Sales. If, at any time while this Debenture is
outstanding, the Company or any Subsidiary, as applicable, sells or grants any
option to purchase or sells or grants any right to reprice, or otherwise
disposes of or issues (or announces any sale, grant or any option to purchase or
other disposition), any Common Stock or Common Stock Equivalents entitling any
Person to acquire shares of Common Stock at an effective price per share that is
lower than the then Conversion Price (such lower price, defined herein as the
“Base Conversion Price” and such issuances, collectively, a “Dilutive
Issuance”) (if the holder of the Common Stock or Common Stock Equivalents so
issued shall at any time, whether by operation of purchase price adjustments,
reset provisions, floating conversion, exercise or exchange prices or otherwise,
or due to warrants, options or rights per share which are issued in connection
with such issuance, be entitled to receive shares of Common Stock at an
effective price per share that is lower than the
Conversion Price, such issuance shall be deemed to have occurred for less than
the Conversion Price on such date of the Dilutive Issuance), then the Conversion
Price shall be reduced to equal the Base Conversion Price. Such adjustment shall
be made whenever such Common Stock or Common Stock Equivalents are issued
provided an adjustment with respect to such securities has not theretofore been
made with respect to the issuance of such Common Stock or Common Stock
Equivalents. Notwithstanding the foregoing, no adjustment will be made under
this Section 5(b) in respect of an Exempt Issuance. If the Company enters into a
Variable Rate Transaction, despite the prohibition set forth in the Purchase
Agreement, the Company shall be deemed to have issued Common Stock or Common
Stock Equivalents at the lowest possible conversion price at which such
securities may be converted or exercised. The Company shall notify the Holder in
writing, no later than the Trading Day following the issuance of any Common
Stock or Common Stock Equivalents subject to this Section 5(b), indicating
therein the applicable issuance price, or applicable reset price, exchange
price, conversion price and other pricing terms (such notice, the “Dilutive
Issuance Notice”). For purposes of clarification, whether or not the
Company provides a Dilutive Issuance Notice pursuant to this Section 5(b), upon
the occurrence of any Dilutive Issuance, the Holder is entitled to receive a
number of Conversion Shares based upon the Base Conversion Price on or after the
date of such Dilutive Issuance, regardless of whether the Holder accurately
refers to the Base Conversion Price in the Notice of Conversion. 

7

          c)          
Subsequent Rights Offerings. If the Company, at any time while the
Debenture is outstanding, shall issue rights, options or warrants to all holders
of Common Stock (and not to the Holders) entitling them to subscribe for or
purchase shares of Common Stock at a price per share that is lower than the VWAP
on the record date referenced below, then the Conversion Price shall be
multiplied by a fraction of which the denominator shall be the number of shares
of the Common Stock outstanding on the date of issuance of such rights, options
or warrants plus the number of additional shares of Common Stock offered for
subscription or purchase, and of which the numerator shall be the number of
shares of the Common Stock outstanding on the date of issuance of such rights,
options or warrants plus the number of shares which the aggregate offering price
of the total number of shares so offered (assuming delivery to the Company in
full of all consideration payable upon exercise of such rights, options or
warrants) would purchase at such VWAP. Such adjustment shall be made whenever
such rights, options or warrants are issued, and shall become effective
immediately after the record date for the determination of stockholders entitled
to receive such rights, options or warrants.

          d)           Pro
Rata Distributions. If the Company, at any time while this Debenture is
outstanding, distributes to all holders of Common Stock (and not to the Holders)
evidences of its indebtedness or assets (including cash and cash dividends) or
rights or warrants to subscribe for or purchase any security (other than the
Common Stock, which shall be subject to Section 5(b)), then in each such case
the Conversion Price shall be adjusted by multiplying such Conversion Price in
effect immediately prior to the record date fixed for determination of
stockholders entitled to receive such distribution by a fraction of which the denominator shall
be the VWAP determined as of the record date mentioned above, and of which the
numerator shall be such VWAP on such record date less the then fair market value
at such record date of the portion of such assets or evidence of indebtedness or
rights or warrants so distributed applicable to one outstanding share of the
Common Stock as determined by the Board of Directors of the Company in good
faith. In either case the adjustments shall be described in a statement
delivered to the Holder describing the portion of assets or evidences of
indebtedness so distributed or such subscription rights applicable to one share
of Common Stock. Such adjustment shall be made whenever any such distribution is
made and shall become effective immediately after the record date mentioned
above. 

8

          e)          
Calculations. All calculations under this Section 5 shall be made to the
nearest cent or the nearest 1/100th of a share, as the case may be. For purposes
of this Section 5, the number of shares of Common Stock deemed to be issued and
outstanding as of a given date shall be the sum of the number of shares of
Common Stock (excluding any treasury shares of the Company) issued and
outstanding. 

          f)     
Notice to the Holder. 

          i.           Adjustment
to Conversion Price. Whenever the Conversion Price is adjusted pursuant to
any provision of this Section 5, the Company shall promptly deliver to each
Holder a notice setting forth the Conversion Price after such adjustment and
setting forth a brief statement of the facts requiring such adjustment.

          ii.          
Notice to Allow Conversion by Holder. If (A) the Company shall declare a
dividend (or any other distribution in whatever form) on the Common Stock, (B)
the Company shall declare a special nonrecurring cash dividend on or a
redemption of the Common Stock, (C) the Company shall authorize the granting to
all holders of the Common Stock of rights or warrants to subscribe for or
purchase any shares of capital stock of any class or of any rights, (D) the
approval of any stockholders of the Company shall be required in connection with
any reclassification of the Common Stock, any consolidation or merger to which
the Company is a party, any sale or transfer of all or substantially all of the
assets of the Company, or any compulsory share exchange whereby the Common Stock
is converted into other securities, cash or property or (E) the Company shall
authorize the voluntary or involuntary dissolution, liquidation or winding up of
the affairs of the Company, then, in each case, the Company shall cause to be
filed at each office or agency maintained for the purpose of conversion of this
Debenture, and shall cause to be delivered to the Holder at its last address as
it shall appear upon the Debenture Register, at least twenty (20) calendar days
prior to the applicable record or effective date hereinafter specified, a notice
stating (x) the date on which a record is to be taken for the purpose of such
dividend, distribution, redemption, rights or warrants, or if a record is not to
be taken, the date as of which the holders of the Common Stock of record to be
entitled to such dividend, distributions, redemption,
rights or warrants are to be determined or (y) the date on which such
reclassification, consolidation, merger, sale, transfer or share exchange is
expected to become effective or close, and the date as of which it is expected
that holders of the Common Stock of record shall be entitled to exchange their
shares of the Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer or share
exchange, provided that the failure to deliver such notice or any defect therein
or in the delivery thereof shall not affect the validity of the corporate action
required to be specified in such notice. To the extent that any notice provided
hereunder constitutes, or contains, material, non-public information regarding
the Company or any of the Subsidiaries, the Company shall simultaneously file
such notice with the Commission pursuant to a Current Report on Form 8-K. The
Holder shall remain entitled to convert this Debenture during the 20-day period
commencing on the date of such notice through the effective date of the event
triggering such notice except as may otherwise be expressly set forth
herein.

9

Section
6.           Events
of Default.

          a)     
“Event of Default” means, wherever used herein, any of the following
events (whatever the reason for such event and whether such event shall be
voluntary or involuntary or effected by operation of law or pursuant to any
judgment, decree or order of any court, or any order, rule or regulation of any
administrative or governmental body): 

          i.     
any default in the payment of (A) the principal amount of any Debenture or (B)
liquidated damages and other amounts owing to a Holder on any Debenture, as and
when the same shall become due and payable (whether on a Conversion Date or the
Maturity Date or by acceleration or otherwise); 

          ii.      the
Company shall fail to observe or perform any other covenant or agreement
contained in the Debentures (other than a breach by the Company of its
obligations to deliver shares of Common Stock to the Holder upon conversion,
which breach is addressed in clause (x) below) which failure is not cured, if
possible to cure, within the earlier to occur of (A) ten (12) Trading Days after
notice of such failure sent by the Holder or by any other Holder to the Company
and (B) twenty (20) Trading Days after the Company has become or should have
become aware of such failure; 

          iii.     
a default or event of default (subject to any grace or cure period provided in
the applicable agreement, document or instrument) shall occur under (A) any of
the Transaction Documents or (B) any other material agreement, lease, document
or instrument to which the Company or any Subsidiary is obligated (and not
covered by clause (vi) below); 

10

          iv.           any
representation or warranty made in this Debenture, any other Transaction
Documents, any written statement pursuant hereto or thereto or any other report,
financial statement or certificate made or delivered to the Holder or any other
Holder shall be untrue or incorrect in any material respect as of the date when
made or deemed made; 

          v.           the
Company or any Significant Subsidiary (as such term is defined in Rule 1-02(w)
of Regulation S-X) shall be subject to a Bankruptcy Event; 

          vi.          
the Company or any Subsidiary shall default on any of its obligations under any
mortgage, credit agreement or other facility, indenture agreement, factoring
agreement or other instrument under which there may be issued, or by which there
may be secured or evidenced, any indebtedness for borrowed money or money due
under any long term leasing or factoring arrangement that (a) involves an
obligation greater than $150,000, whether such indebtedness now exists or shall
hereafter be created, and (b) results in such indebtedness becoming or being
declared due and payable prior to the date on which it would otherwise become
due and payable;

          vii.          
at any time after issuance of the Debentures, the Common Stock shall not be
eligible for listing or quotation for trading on a Trading Market and shall not
be eligible to resume listing or quotation for trading thereon within five
Trading Days; 

          b)     
Remedies Upon Event of Default. If any Event of Default occurs, the
outstanding principal amount of this Debenture, plus interest and other amounts
owing in respect thereof through the date of acceleration, shall become, at the
Holder’s election, immediately due and payable in cash at the Mandatory Default
Amount. Upon the payment in full of the Default Amount, the Holder shall
promptly surrender this Debenture to or as directed by the Company. In
connection with such acceleration described herein, the Holder need not provide,
and the Company hereby waives, any presentment, demand, protest or other notice
of any kind, and the Holder may immediately and without expiration of any grace
period enforce any and all of its rights and remedies hereunder and all other
remedies available to it under applicable law. Such acceleration may be
rescinded and annulled by Holder at any time prior to payment hereunder and the
Holder shall have all rights as a holder of the Debenture until such time, if
any, as the Holder receives full payment pursuant to this Section 6(b). No such
rescission or annulment shall affect any subsequent Event of Default or impair
any right consequent thereon. 

Section 7.     
Miscellaneous.

11

          a)          
Notices. Any and all notices or other communications or deliveries to be
provided by the Holder hereunder, including, without limitation, any Notice of
Conversion, shall be in writing and delivered personally, by facsimile, or sent
by a nationally recognized overnight courier service, or by email, addressed to
the Company, at the address set forth above, or such other facsimile number or
by e-mail delivery of a “.pdf” format data file or other address as the Company
may specify for such purposes by notice to the Holder delivered in accordance
with this Section 7(a). Any and all notices or other communications or
deliveries to be provided by the Company hereunder shall be in writing and
delivered personally, by facsimile, or sent by a nationally recognized overnight
courier service or by email, addressed to each Holder at the facsimile number or
address or email address of the Holder appearing on the books of the Company, or
if no such facsimile number or address appears on the books of the Company, at
the principal place of business of such Holder, as set forth in the Purchase
Agreement. Any notice or other communication or deliveries hereunder shall be
deemed given and effective on the earliest of (i) the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile number
set forth on the signature pages attached hereto prior to 5:30 p.m. (Central
time zone) on any date, (ii) the next Trading Day after the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile number set forth on the signature pages attached hereto on a day that
is not a Trading Day or later than 5:30 p.m. (Central time zone) on any Trading
Day, (iii) the second Trading Day following the date of mailing, if sent by U.S.
nationally recognized overnight courier service or (iv) upon actual receipt by
the party to whom such notice is required to be given. 

          b)           Absolute
Obligation. Except as expressly provided herein, no provision of this
Debenture shall alter or impair the obligation of the Company, which is absolute
and unconditional, to pay the principal and liquidated damages, as applicable,
on this Debenture at the time, place, and rate, and in the coin or currency,
herein prescribed. This Debenture is a direct debt obligation of the
Company.

          c)           Lost
or Mutilated Debenture. If this Debenture shall be mutilated, lost, stolen
or destroyed, the Company shall execute and deliver, in exchange and
substitution for and upon cancellation of a mutilated Debenture, or in lieu of
or in substitution for a lost, stolen or destroyed Debenture, a new Debenture
for the principal amount of this Debenture so mutilated, lost, stolen or
destroyed, but only upon receipt of evidence of such loss, theft or destruction
of such Debenture, and of the ownership hereof, reasonably satisfactory to the
Company. 

          d)          
Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of this Debenture shall be governed by and
construed and enforced in accordance with the internal laws of the State of
Oklahoma, without regard to the principles of conflict of laws thereof. Each
party agrees that all legal proceedings concerning the interpretation,
enforcement and defense of the transactions contemplated by any of the
Transaction Documents (whether brought against a party hereto or its respective
Affiliates, directors, officers, shareholders, employees or agents) shall be commenced in the state and federal
courts sitting in the City of Tulsa, (the “Oklahoma Courts”). Each party hereto
hereby irrevocably submits to the exclusive jurisdiction of the Oklahoma Courts
for the adjudication of any dispute hereunder or in connection herewith or with
any transaction contemplated hereby or discussed herein (including with respect
to the enforcement of any of the Transaction Documents), and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of such Oklahoma Courts,
or such Oklahoma Courts are improper or inconvenient venue for such proceeding.
Each party hereby irrevocably waives personal service of process and consents to
process being served in any such suit, action or proceeding by mailing a copy
thereof via registered or certified mail or overnight delivery (with evidence of
delivery) to such party at the address in effect for notices to it under this
Debenture and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any other manner permitted by
applicable law. Each party hereto 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 Debenture or the
transactions contemplated hereby. If any party shall commence an action or
proceeding to enforce any provisions of this Debenture, then the prevailing
party in such action or proceeding shall be reimbursed by the other party for
its attorneys’ fees and other costs and expenses incurred in the investigation,
preparation and prosecution of such action or proceeding.

12

          e)           Waiver.
Any waiver by the Company or the Holder of a breach of any provision of this
Debenture shall not operate as or be construed to be a waiver of any other
breach of such provision or of any breach of any other provision of this
Debenture. The failure of the Company or the Holder to insist upon strict
adherence to any term of this Debenture on one or more occasions shall not be
considered a waiver or deprive that party of the right thereafter to insist upon
strict adherence to that term or any other term of this Debenture on any other
occasion. Any waiver by the Company or the Holder must be in writing. 

          f)           Severability.
If any provision of this Debenture is invalid, illegal or unenforceable, the
balance of this Debenture shall remain in effect, and if any provision is
inapplicable to any Person or circumstance, it shall nevertheless remain
applicable to all other Persons and circumstances. If it shall be found that any
interest or other amount deemed interest due hereunder violates the applicable
law governing usury, the applicable rate of interest due hereunder shall
automatically be lowered to equal the maximum rate of interest permitted under
applicable law. The Company covenants (to the extent that it may lawfully do so)
that it shall not at any time insist upon, plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay, extension or usury law or
other law which would prohibit or forgive the Company from paying all or any
portion of the principal of or interest on this Debenture as contemplated
herein, wherever enacted, now or at any time hereafter in force, or which may
affect the covenants or the performance of this indenture, and the Company (to
the extent it may lawfully do so) hereby expressly waives all benefits or
advantage of any such law, and covenants that it will not, by resort to any such law,
hinder, delay or impede the execution of any power herein granted to the Holder,
but will suffer and permit the execution of every such as though no such law has
been enacted. 

13

          g)           Next
Business Day. Whenever any payment or other obligation hereunder shall be
due on a day other than a Business Day, such payment shall be made on the next
succeeding Business Day. 

          h)           Headings.
The headings contained herein are for convenience only, do not constitute a part
of this Debenture and shall not be deemed to limit or affect any of the
provisions hereof. 

IN WITNESS WHEREOF, the Company has caused this Debenture to be
duly executed by a duly authorized officer as of the date first above indicated.

AMERICAN NATURAL ENERGY CORPORATION

 

By: /s/ Michael
Paulk 
        Name: Michael
Paulk 
        Title: President 

14

ANNEX A 

NOTICE OF CONVERSION 

          The
undersigned hereby elects to convert principal under the 12% Convertible
Debenture due August 13, 2014 of American Natural Energy Corporation, a Nevada
corporation (the “Company”), into shares of common stock (the “Common
Stock”), of the Company according to the conditions hereof, as of the date
written below. If shares of Common Stock are to be issued in the name of a
person other than the undersigned, the undersigned will pay all transfer taxes
payable with respect thereto and is delivering herewith such certificates and
opinions as reasonably requested by the Company in accordance therewith. No fee
will be charged to the holder for any conversion, except for such transfer
taxes, if any. 

          By
the delivery of this Notice of Conversion the undersigned represents and
warrants to the Company that its ownership of the Common Stock does not exceed
the amounts specified under Section 4 of this Debenture, as determined in
accordance with Section 13(d) of the Exchange Act. 

          The
undersigned agrees to comply with the prospectus delivery requirements under the
applicable securities laws in connection with any transfer of the aforesaid
shares of Common Stock.

Conversion calculations: 

Date to Effect Conversion: 

Principal Amount of Debenture to be
Converted: 

Number of shares of Common Stock to be
issued: 

Signature: 

Name: 

Address for Delivery of Common Stock
Certificates: 

Or 

DWAC Instructions: 

Broker No:
________________________
Account No: ______________________

15

Schedule 1 

CONVERSION SCHEDULE 

The 12% Convertible Debentures due on August 13, 2014 in the
aggregate principal amount of $____________are issued by American Natural Energy
Corporation, a Nevada corporation. This Conversion Schedule reflects conversions
made under Section 4 of the above referenced Debenture. 

Dated:

	Date of Conversion 
(or for first entry,
      
Original Issue Date) 	Amount of 
Conversion 	Aggregate 
Principal
      
Amount 
Remaining 
Subsequent to 
Conversion 
(or original
      
Principal 
Amount) 	Company Attest 
	
       

       
	 	 	 
	
       

       
	 	 	 
	
       

       
	 	 	 
	
       

       
	 	 	 
	
       

       
	 	 	 
	
       

       
	 	 	 
	
       

       
	 	 	 
	
       

       
	 	 	 
	
       

       
	 	 	 

16American Natural Energy Corporation  - Exhibit 10.3 - Filed by newsfilecorp.com

Exhibit 10.3 

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
  UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "U.S. SECURITIES
  ACT") OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THE HOLDER HEREOF,
  BY PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE COMPANY THAT SUCH
  SECURITIES MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED ONLY (A) TO THE COMPANY;
  (B) IN ACCORDANCE WITH RULE 905 OF REGULATION S UNDER THE U.S. SECURITIES ACT;
  (C) IN ACCORDANCE WITH THE EXEMPTION FROM REGISTRATION UNDER THE U.S. SECURITIES
  ACT PROVIDED BY RULE 144 THEREUNDER, IF AVAILABLE, AND IN COMPLIANCE WITH ANY
  APPLICABLE STATE SECURITIES LAWS; OR (D) IN A TRANSACTION THAT DOES NOT REQUIRE
  REGISTRATION UNDER THE U.S. SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES
  LAWS, AND, IN THE CASE OF PARAGRAPH (C) OR (D), UPON REQUEST OF THE COMPANY,
  THE SELLER FURNISHES TO THE COMPANY AN OPINION OF COUNSEL OF RECOGNIZED STANDING
  IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY TO SUCH EFFECT.

WARRANT TO PURCHASE COMMON SHARES 
OF 
AMERICAN
NATURAL ENERGY CORPORATION 
(Incorporated under the laws of State of
Oklahoma) 

Warrant Certificate No: W-08-2012-01 

THIS IS TO CERTIFY THAT, for value received, Palo Verde
Acquisitions, LLC., the holder of this Warrant, is entitled to purchase:

20,000,000 

non-assessable common shares of American Natural Energy
Corporation (hereinafter called the "Company") as such shares were constituted
on August 13, 2012 at any time up to 4:30 p.m. local time at the City of Tulsa,
Oklahoma on August 13, 2014 at and for a price of US $0.23 per share, of lawful
money of the United States, upon and subject to the terms and conditions
attached hereto. 

This Warrant may not be transferred or assigned by the holder.

This Warrant and the common shares to be issued upon its
exercise have not been registered under the United States Securities Act of
1933, as amended (the "U.S. Securities Act") or the securities laws of any state
of the United States. This Warrant may not be exercised unless (i) the common
shares are registered under the U.S. Securities Act and the applicable laws of
any such state, or, (ii) an exemption from such registration requirements is
available. "United States" and "U.S. person" are as defined in Regulation S
under the U.S. Securities Act. 

This Warrant may be exercised only at the offices of the
Company, Suite 2010, 6100 South Yale Avenue, Tulsa, Oklahoma, 74136. 

AMERICAN NATURAL ENERGY CORPORATION 

 

	Per: 	/s/ Michael Paulk 
	  	Director/Officer 
	  	  
	DATE: 	August 13, 2012 
	  	  
	
      NOTE: 
	
      Any share certificates issued upon exercise of this
      Warrant prior to the expiry of the hold periods will be printed with the
      corresponding legends. 

TERMS, CONDITIONS AND INSTRUCTIONS 

	1. 	
      The holder of this Warrant may subscribe for up to the
      number of shares of the Company ("Warrant Shares") indicated on the
      face hereof in accordance with and subject to the terms and conditions set
      out in this Warrant.

	 	 
	2. 	
      For each Warrant Share purchased pursuant to this Warrant
      on or before August 13, 2014, payment must be made in the amount of
      US$0.23 per share (the "Exercise Price"). All payments must be made
      in United States funds, in cash or by certified check, bank draft or money
      order payable, at par, in Tulsa, Oklahoma to "American Natural Energy
      Corporation" If payment is made by way of an uncertified check, the
      Company reserves the right to deem that the payment has not been received
      until the check has cleared the account upon which it has been
    drawn.

	 	 
	3. 	
      To exercise the rights evidenced by this Warrant, this
      Warrant with the Warrant Exercise Form attached hereto completed and
      payment as required for the shares subscribed for, must be delivered or
      mailed to the Company, Suite 2010, 6100 South Yale Avenue, Tulsa,
      Oklahoma, 74136 and received by such company.

	 	 
	4. 	
      The rights evidenced by this Warrant expire at 4:30 p.m.
      local time in Tulsa, Oklahoma, on August 13, 2014.

	 	 
	5. 	
      Any certificate representing common shares issued upon
      the exercise of this Warrant will bear the following legends, unless in
      the opinion of counsel to the Company such legend or legends are not
      required:

  
    
      UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE
        HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE (four
        months and 1 day from issue date). 

      WITHOUT PRIOR WRITTEN APPROVAL OF THE TSX VENTURE
        EXCHANGE AND COMPLIANCE WITH ALL APPLICABLE SECURITIES LEGISLATION, THE
        SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD, TRANSFERRED,
        HYPOTHECATED OR OTHERWISE TRADED ON OR THROUGH THE FACILITIES OF THE TSX
        VENTURE EXCHANGE OR OTHERWISE IN CANADA OR TO OR FOR THE BENEFIT OF A
        CANADIAN RESIDENT UNTIL (four months and 1 day from issue date).
        

    

  

	6. 	
      The certificates representing any Warrant Shares issued
      upon exercise of the Warrants, as well as all certificates issued in
      exchange for or in substitution of the foregoing, until, in the opinion of
      counsel to the Company, such time as is no longer required under the
      applicable requirements of the United States Securities Act of
      1933, as amended (the "U.S. Securities Act") or applicable
      state securities laws, will bear, on the face of such certificate, the
      following legend:

  
    
      THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
        UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "U.S.
        SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES.
        THE HOLDER HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT
        OF THE COMPANY THAT SUCH SECURITIES MAY BE OFFERED, SOLD OR OTHERWISE
        TRANSFERRED ONLY (A) TO THE COMPANY; (B) IN ACCORDANCE WITH RULE 905 OF
        REGULATION S UNDER THE U.S. SECURITIES ACT; (C) IN ACCORDANCE WITH THE
        EXEMPTION FROM REGISTRATION UNDER THE U.S. SECURITIES ACT PROVIDED BY
        RULE 144 THEREUNDER, IF AVAILABLE, AND IN COMPLIANCE WITH ANY APPLICABLE
        STATE SECURITIES LAWS; OR (D) IN A TRANSACTION THAT DOES NOT REQUIRE REGISTRATION
        UNDER THE U.S. SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS,
        AND, IN THE CASE OF PARAGRAPH (C) OR (D), UPON REQUEST OF THE COMPANY,
        THE SELLER FURNISHES TO THE COMPANY AN OPINION OF COUNSEL OF RECOGNIZED
        STANDING IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY TO SUCH EFFECT.
        THE PRESENCE OF THIS LEGEND MAY IMPAIR THE ABILITY OF THE HOLDER HEREOF
        TO EFFECT "GOOD DELIVERY" OF THE SECURITIES REPRESENTED HEREBY ON A CANADIAN
        STOCK EXCHANGE. 

    

  

- 2 - 

	7. 	
      The rights evidenced by this Warrant may not be
      transferred or assigned.

	 	 
	8. 	
      The rights to purchase Warrant Shares granted by this
      certificate may be exercised, subject to the terms and conditions hereof,
      in whole or in part (but not as to a fractional share) from time to
      time.

	 	 
	9. 	
      This Warrant does not entitle the holder to any rights as
      a shareholder of the Company, including, without limitation, voting
      rights.

	 	 
	10. 	
      If this Warrant or the purchase price are forwarded by
      mail, it is suggested that registered mail be used as the Company and
      Computershare Investor Services Inc. will not be responsible for any
      losses which occur through the use of mails.

	 	 
	10. 	
      The Company shall, no more than five business days after
      delivery of this Warrant, together with a duly executed Warrant Exercise
      Form and payment as required hereby for the shares subscribed for, issue
      and deliver to the holder certificates for that number of shares
      subscribed for, at the address shown on the Warrant Exercise
  Form.

	11. 	(a) 	If, prior to the expiry of this
      Warrant, the Company, 

	 	(i) 	
      subdivides, redivides, combines or consolidates its then
      outstanding common shares into a greater or lesser number of common
      shares, or

	 	 	 
	 	(ii) 	
      distributes securities by way of stock dividend or
      otherwise (other than the issuance of common shares to holders of common
      shares who have elected to receive stock dividends in lieu of cash
      dividends) to holders of all or substantially all of its then outstanding
      common shares,

	 		
      (any of such events herein called a "Common Share
      Reorganization"), then the Exercise Price shall be adjusted effective
      immediately after the record date determined for purposes, on the
      effective date, of such Common Share Reorganization by multiplying the
      Exercise Price in effect immediately prior to such record date or
      effective date, as the case may be, by a fraction, the numerator of which
      shall be the number of common shares outstanding on such record date or
      effective date, as the case may be, before giving effect to the Common
      Share Reorganization and the denominator of which shall be the number of
      common shares outstanding immediately after giving effect to such Common
      Share Reorganization including, in the case where securities exchangeable
      for or convertible into common shares are distributed, the number of
      common shares that would be outstanding if such securities were exchanged
      for or converted into common shares. From and after any adjustment of the
      Exercise Price pursuant to this section 11(a), the number of common shares
      issuable pursuant to this Warrant shall also be adjusted by multiplying
      the number of common shares then otherwise issuable by a fraction, the
      numerator of which shall be the Exercise Price in effect immediately prior
      to the adjustment and the denominator of which shall be the Exercise Price
      resulting from such adjustment.

	 	 	 
	 	(b) 	
      If, prior to the expiry of this Warrant, the Company
      fixes a record date for the issue of options, rights or warrants
      exercisable during a period expiring not more than 45 days after the
      record date for such issue (the "Rights Period") to all or
      substantially all the holders of common shares entitling them to acquire
      common shares or other securities convertible or exchangeable into common
      shares at less than 95% of their Current Market Price (as hereinafter
      defined) (any of such events herein called a "Rights
Offering"), then the Exercise Price shall be adjusted effective immediately
after the end of the Rights Period to a price determined by multiplying the
Exercise Price in effect immediately after such record date by a fraction, 

- 3 - 

	 	(i) 	
      the numerator of which shall be the aggregate
  of:

	 	 	 	 	 
	 		(1) 	
      the number of common shares outstanding as of the record
      date for the Rights Offering; and

	 	 	 	 	 
	 		(2) 	
      a number determined by dividing either

	 	 	 	 	 
	 			(A) 	
      the product of the number of common shares issued or
      subscribed for during the Rights Period and the price at which such common
      shares are offered, or

	 	 	 	 	 
	 			(B) 	
      the product of the exchange or conversion price of such
      securities offered and the number of common shares for or into which the
      securities so offered pursuant to the Rights Offering have been exchanged
      or converted during the Rights Period,

	 	 	 	 	 
	 			
      by the Current Market Price of the common shares on the
      record date for the Rights Offering; and

	 	 	 	 	 
	 	(ii) 	
      the denominator of which shall be the number of common
      shares outstanding after giving effect to the Rights Offering, including
      the number of common shares actually issued or subscribed for (or
      securities for or into which the securities so offered pursuant to the
      Rights Offering have been exchanged or converted) during the Rights
      Period.

	 		
      If the holder has exercised this Warrant at any time
      during the period commencing immediately after the record date for a
      Rights Offering and expiring on the last day of the Rights Period, the
      holder shall be entitled to receive from the Company, not later than 30
      days after the end of the Rights Period, an amount equal to the
      difference, if any, between the Exercise Price in effect immediately prior
      to the end of such Rights Period and the Exercise Price as adjusted for
      such Rights Offering pursuant to this section 11(b) multiplied by the
      number of common shares acquired upon such exercise of this Warrant.
      Payment of any such amount shall be mailed to the address to which the
      common shares purchased upon such exercise are to be sent.

	 	 	 
	 	(c) 	
      If, prior to the expiry of this Warrant, the Company
      distributes evidences of its indebtedness or any property or other assets
      (other than by way of a Common Share Reorganization or Rights Offering and
      excluding cash dividends paid in the ordinary course) to holders of all or
      substantially all of its then outstanding common shares, the number of
      common shares to be issued by the Company under this Warrant shall, at the
      time of exercise, be appropriately adjusted and the holder shall receive,
      in lieu of the number of common shares in respect of which the right is
      then being exercised, the aggregate number of common shares or other
      securities or property that the holder would have been entitled to receive
      as a result of such event, if, on the record date therefor, the holder had
      been the registered holder of the number of common shares to which the
      holder was theretofore entitled upon the exercise of this
  Warrant.

	 	 	 
	 	(d) 	
      If, prior to the expiry of this Warrant, there is a
      capital reorganization of the Company or a reclassification or other
      change in the common shares (other than a Common Share Reorganization) or
      a consolidation, merger or amalgamation of the Company with or into any
      other corporation or entity (other than a consolidation, merger or
      amalgamation which does not result in any reclassification of the
      outstanding common shares or a change of the common shares into other
      securities) or a transfer of all or substantially all of the Company's
      undertaking and assets to another corporation or entity in which the
      holders of common shares are entitled to receive shares, other securities
      or property (any of such events being called a "Capital
      Reorganization"), the holder, where the holder has not exercised this Warrant
      prior to the effective date of such Capital Reorganization, shall be
      entitled to receive and shall accept, upon the exercise of such right, on
      such date or any time thereafter, for the same aggregate consideration in
      lieu of the number of common shares to which the holder was theretofore
      entitled to subscribe for and purchase, the aggregate number of shares or
      other securities or property which the holder would have been entitled to
      receive as a result of such Capital Reorganization if, on the effective
      date thereof, the holder had been the registered holder of the number of
      common shares to which the holder was theretofore entitled to acquire
      hereunder.

- 4 - 

	 	(e) 	
      Any adjustments made pursuant to this section 11 shall be
      subject to the following rules and procedures:

	 	(i) 	
      the adjustments provided for in section 11 are cumulative
      and shall be made successively whenever an event referred to herein shall
      occur, provided no adjustment shall be made unless the cumulative effect
      of all such adjustments would change the Exercise Price by at least one
      percent of the current Exercise Price or if the holder is allowed to
      participate in the specified event as though the holder had exercised this
      Warrant prior to such occurrence of such event;

	 	 	 
	 	(ii) 	
      if the Company sets a record date to take any action and
      thereafter and before taking such action abandons its plan to take such
      action, then no adjustment to the Exercise Price shall be required by
      reason of setting such record date;

	 	 	 
	 	(iii) 	
      forthwith after any adjustment to the Exercise Price, the
      number of common shares or the type of securities issuable pursuant to
      this Warrant, the Company shall provide to the holder notice as to the
      amount of such adjustment and, in reasonable detail, describing the event
      requiring and the manner of computing or determining such
    adjustment;

	 	 	 
	 	(iv) 	
      upon the occurrence of each and every event set out in
      this section 11, the provisions of this Warrant, including the Exercise
      Price, shall ipso facto be deemed to be amended accordingly and the
      Company shall take all necessary action to comply with such provisions as
      so amended;

	 	 	 
	 	(v) 	
      "Current Market Price" of the common shares at any
      date means the weighted average trading price per share for the common
      shares for any 20 consecutive trading days (a "trading day" with
      respect to a stock exchange, quotation system or the over-the-counter
      market being a day on which such stock exchange, quotation system or
      over-the-counter market is open for business) selected by the Company
      commencing not more than 30 trading days and ending not less than three
      trading days before such date on such stock exchange or over-the-counter
      market on which the common shares trade (provided that if on any day in
      such period no closing price per share for the common shares is reported
      by such exchange for such day, the average of the reported closing bid and
      asked prices on such exchange on such day shall be deemed to be the
      closing price per share for the common shares for such day). If the common
      shares are not listed on a recognized stock exchange or quoted on the
      over-the-counter market, the Current Market Price of the common shares
      shall be, at any time, the price per common share equal to the fair market
      value thereof as reasonably determined by the board of directors of the
      Company;

	 	 	 
	 	(vi) 	
      if the Company after the date of issuance of this Warrant
      takes any action affecting the common shares, other than any action
      described in this section 11, which in the reasonable opinion of the
      directors would materially affect the rights of holders of this Warrant,
      the Exercise Price and the number of common shares which may be acquired
      upon the exercise of this Warrant shall be adjusted by the directors in
      such manner and at such time as the directors in their sole discretion may
      determine to be equitable in the circumstances; provided that no such
      adjustment will be made unless prior approval of any stock exchange on
      which the common shares are listed for trading has been obtained. Failure
      of the directors to make such an adjustment shall be prima
      facie evidence that the directors have determined that it is equitable
      to make no adjustment in the circumstances. If any such adjustment is
      made, the Company shall deliver a notice to the holder describing such
      adjustment;

- 5 - 

	 	(vii) 	
      in case a state of facts exists to which the provisions
      of this section 11 are not strictly applicable, or, if strictly
      applicable, operate in an unclear manner or in a manner that would not
      fairly adjust the rights of the holder against dilution in accordance with
      the intent and purposes of this section 11, the Company shall execute and
      deliver to the holder an amendment to this section 11 providing for an
      adjustment in the application of such provisions so as to adjust such
      rights in accordance with the advice of legal counsel to whom the Company
      may refer any such question. The Company shall refer such question to
      legal counsel upon the written request of the holder, acting
      reasonably;

	 	 	 
	 	(viii) 	
      in the event of any question arising with respect to the
      adjustments provided in section 11, such question shall be conclusively
      determined by a firm of chartered accountants appointed by the Company,
      acting reasonably (who may be the Company's auditors), such accountants
      shall have access to all necessary records of the Company and such
      determination shall be binding upon the Company and the holder;

	 	 	 
	 	(ix) 	
      as a condition precedent to the taking of any action
      which would result in an adjustment to the number of common shares
      purchasable upon exercise of these Warrants, the Company shall take any
      corporate action which may be necessary in order that the common shares to
      which the holder is entitled on the full exercise of its exercise right in
      accordance with the provisions hereof shall be available for such purpose
      and that such common shares may be validly and legally issued as fully
      paid and non-assessable common shares;

	 	 	 
	 	(x) 	
      if the issuance of any common shares upon the exercise of
      this Warrant requires any filing or registration with or approval of any
      governmental authority or compliance with any other requirement under any
      law before such shares may be validly issued upon such exercise, the
      Company agrees to take such actions as may be necessary to secure such
      filing, registration, approval or compliance, as the case may be; provided
      that, in the event that such filing, registration, approval or compliance
      is required only by reason of the particular circumstances of or actions
      taken by any such person, the Company will not be required to take such
      action;

	 	 	 
	 	(xi) 	
      the Company shall from time to time promptly after the
      occurrence of any event which requires an adjustment in the number of
      common shares purchasable upon exercise of this Warrant as above provided,
      deliver notice to the holder specifying the nature of the event requiring
      the adjustment and the amount of the adjustment thereby necessitated and
      setting forth in reasonable detail the adjusted number of common shares,
      method of calculation and the facts upon which such calculation is based;
      and

	 	 	 
	 	(xii) 	
      the Company will not effect any Capital Reorganization
      which could result in a successor to the Company unless prior to or
      simultaneously with the consummation thereof, the entity succeeding the
      Company acknowledges in writing that it is bound by and will comply with
      the provisions set forth in this Warrant
certificate.

	12. 	
      The Company will at all times before August 13, 2014 keep
      available, and reserve if necessary, out of its authorized shares, solely
      for the purpose of issue upon the exercise of this Warrant, such number of
      Warrant Shares of the Company as shall then be issuable upon the exercise
      of this Warrant. The Company covenants and agrees that all Warrant Shares
      which shall be so issuable will, upon issuance, be issued as fully paid
      and non-assessable and free from all liens, charges and encumbrances. The
      Company will use its commercially reasonable best efforts to maintain the
      listing of its common shares on the TSX Venture Exchange or another
      recognized stock exchange until the expiry date of this
  Warrant.

- 6 - 

	13. 	
      This Warrant certificate is to be governed by and
      construed in accordance with the laws of the State of Oklahoma and the
      laws of United States applicable therein.

WARRANT EXERCISE FORM 

The undersigned, holder of the within Warrant, hereby
subscribes for 20,000,000 common shares of American Natural Energy Corporation
(the "Company"), pursuant to a private placement conditionally approved by the
TSX Venture Exchange on June 29, 2012. If the number of common shares purchased
hereby does not exercise all of the rights evidenced by this Warrant, the holder
requests issuance and delivery to it at the following address of a new Warrant
evidencing the unused rights.

The undersigned directs that the common shares hereby
subscribed for be issued and delivered to it as follows: 

	NAME 	 	ADDRESS 	 	NO. OF SHARES 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 

As at the time of exercise hereunder, the undersigned
represents, warrants and certifies as follows (check one): 

	[   ] 	(A) 	
      the undersigned holder at the time of exercise of the
      Warrants is not in the United States, is not a "U.S. person" as defined in
      Regulation S under the United States Securities Act of 1933, as
      amended (the "U.S. Securities Act") and is not exercising the
      Warrants for the account or benefit of a U.S. person or person in the
      United States and did not execute or deliver this exercise form in the
      United States; OR 

	[   ] 	(B) 	
      (i) the undersigned holder is resident in the United
      States, is a U.S. person, or is exercising the Warrant for the account or
      benefit of a U.S. person or person in the United States, (ii) the holder
      is a resident of the jurisdiction referred to in the address appearing
      above, (iii) the holder was the original subscriber for the Warrant from
      the Company and (iv) the representations, warranties and covenants set
      forth in the Subscription Agreement are true and correct on the date of
      exercise of this Warrant, including specifically, the representations and
      warranties in Schedule D to the Subscription Agreement; OR 

	[   ] 	(C) 	
      if the undersigned holder is resident in the United
      States, is a U.S. person, or is exercising the Warrant for the account or
      benefit of a U.S. Person or person in the United States, the undersigned
      holder either [ ] (i) is an "accredited investor" (as defined in Rule
      501(a) of Regulation D under the U.S. Securities Act) and has completed
      the U.S. Accredited Investor Status Certificate in the form attached to
      this exercise form and hereby makes the representations, warranties and
      acknowledgments as provided below OR [ ] (ii) has delivered to the Company
      and the Company’s transfer agent an opinion of counsel (which will not be
      sufficient unless it is in form and substance satisfactory to the Company)
      or such other evidence satisfactory to the Company to the effect that with
      respect to the common shares to be delivered upon exercise of the
      Warrants, the issuance of such securities has been registered under the
      U.S. Securities Act and applicable state securities laws or an exemption
      from the registration requirements of the U.S. Securities Act and
      applicable state securities laws is available. 

Note: Certificates representing common shares will not be
registered or delivered to an address in the United States unless box (B) or (C)
immediately above is checked. 

The undersigned additionally represents and warrants to the
Company that: 

	1. 	
      the undersigned has such knowledge and experience in
      financial and business matters as to be capable of evaluating the merits
      and risks of an investment in the common shares, and the undersigned is
      able to bear the economic risk of loss of his or her entire
    investment;

	 	 
	2. 	
      the undersigned is: (i) purchasing the common shares for
      his or her own account or for the account of one or more U.S. Accredited
      Investors with respect to which the undersigned is exercising sole
      investment discretion, and not on behalf of any other person; (ii)
      is purchasing the common shares for investment purposes only and not with
      a view to resale, distribution or other disposition in violation of United
      States federal or state securities laws; and (iii) in the case of the
      purchase by the undersigned of the common shares as agent or trustee for
      any other person or persons (each a "Beneficial Owner"), the
      undersigned holder has due and proper authority to act as agent or trustee
      for and on behalf of each such Beneficial Owner in connection with the
      transactions contemplated hereby; provided that: (x) if the undersigned
      holder, or any Beneficial Owner, is a corporation or a partnership,
      syndicate, trust or other form of unincorporated organization, the
      undersigned holder or each such Beneficial Owner was not incorporated or
      created solely, nor is it being used primarily to permit purchases without
      a prospectus or registration statement under applicable law; and (y) each
      Beneficial Owner, if any, is a U.S. Accredited Investor; and

2

	3. 	
      the undersigned has not exercised the Warrants as a
      result of any form of general solicitation or general advertising,
      including advertisements, articles, notices or other communications
      published in any newspaper, magazine or similar media or broadcast over
      radio, television or other form of telecommunications, or any seminar or
      meeting whose attendees have been invited by general solicitation or
      general advertising.

The undersigned also acknowledges and agrees that: 

	1. 	
      the Company has provided to the undersigned the
      opportunity to ask questions and receive answers concerning the terms and
      conditions of the offering, and the undersigned has had access to such
      information concerning the Company as the undersigned has considered
      necessary or appropriate in connection with the undersigned's investment
      decision to acquire the common shares;

	 	 	 
	2. 	
      if the undersigned decides to offer, sell or otherwise
      transfer any of the common shares, the undersigned must not, and will not,
      offer, sell or otherwise transfer any of such common shares directly or
      indirectly, unless:

	 	 	 
		(a) 	
      the sale is to the Company;

	 	 	 
		(b) 	
      the sale is made outside the United States in a
      transaction meeting the requirements of Rule 905 of Regulation S under the
      U.S. Securities Act and in compliance with applicable local laws and
      regulations;

	 	 	 
		(c) 	
      the sale is made pursuant to the exemption from the
      registration requirements under the U.S. Securities Act provided by Rule
      144 thereunder and in accordance with any applicable state securities or
      "blue sky" laws; or

	 	 	 
		(d) 	
      the common shares are sold in a transaction that does not
      require registration under the U.S. Securities Act or any applicable state
      laws and regulations governing the offer and sale of securities, and it
      has prior to such sale furnished to the Company an opinion of counsel
      reasonably satisfactory to the Company;

	 	 	 
	3. 	
      the common shares are "restricted securities" under
      applicable federal securities laws and that the U.S. Securities Act and
      the rules of the United States Securities and Exchange Commission provide
      in substance that the undersigned may dispose of the common shares only
      pursuant to an effective registration statement under the U.S. Securities
      Act or an exemption therefrom;

	 	 	 
	4. 	
      the Company has no obligation to register any of the
      common shares or to take action so as to permit sales pursuant to the U.S.
      Securities Act (including Rule 144 thereunder);

	 	 	 
	5. 	
      the certificates representing the common shares (and any
      certificates issued in exchange or substitution for the common shares)
      will bear a legend stating that such securities have not been registered
      under the U.S. Securities Act or the securities laws of any state of the
      United States and may not be offered for sale or
sold unless registered under the U.S. Securities Act and the
      securities laws of all applicable states of the United States or an
      exemption from such registration requirements is available;

3

	6. 	
      delivery of certificates bearing such a legend may not
      constitute "good delivery" in settlement of transactions on Canadian stock
      exchanges or over-the-counter markets,; and

	 	 
	7. 	
      the undersigned consents to the Company making a notation
      on its records or giving instructions to any transfer agent of the Company
      in order to implement the restrictions on transfer set forth and described
      in this Warrant Exercise Form.

In the absence of instructions to the contrary, the securities
or other property will be issued in the name of or to the holder hereof and will
be sent by first class mail to the last address of the holder appearing on the
register maintained for the Warrants. 

DATED this ____ day of ______________, 20____. 

_______________________________________________________
Signature

_______________________________________________________
Name
(please print) 

_______________________________________________________
Address

_______________________________________________________

 

 

Instructions: 

	1. 	
      The registered holder may exercise its right to receive
      Warrant Shares by completing this form and surrendering this form and the
      Warrant Certificate representing the Warrants being exercised together
      with payment of the aggregate Exercise Price, by certified check, bank
      draft or money order payable in U.S. dollars to the order of "American
      Natural Energy Corporation", to the Company, Suite 2010, 6100 South Yale
      Avenue, Tulsa, Oklahoma, 74136, and such other documents as the Company
      may reasonably require. Certificates for Warrant Shares will be delivered
      or mailed within five business days after the exercise of the Warrants.
      The rights of the registered warrant holder hereof cease if the Warrants
      are not exercised on or prior to August 13, 2014.

	 	 
	2. 	
      If the Warrant Exercise Form indicates that common shares
      are to be issued to a person or persons other than the registered holder
      of the Warrant Certificate, the signature of such holder of the Warrant
      Exercise Form must be guaranteed by an authorized officer of a chartered
      bank, trust company or medallion guaranteed by an investment dealer who is
      a member of a recognized stock exchange.

4

	3. 	
      If the Warrant Exercise Form is signed by a trustee,
      executor, administrator, curator, attorney, officer of a Company or any
      person acting in a judiciary or representative capacity, the certificate
      must be accompanied by evidence of authority to sign satisfactory to the
      Company.

U.S. ACCREDITED INVESTOR STATUS CERTIFICATE 

  	
        In connection with the exercise of certain outstanding
          warrants of AMERICAN NATURAL ENERGY CORPORATION (the "Company")
          by the holder, the holder hereby represents and warrants to the Company
          that the holder, and each beneficial owner (each a "Beneficial Owner"),
          if any, on whose behalf the holder is exercising such warrants, satisfies
          one or more of the following categories of Accredited Investor (please
          write "W/H" for the undersigned holder, and "B/O" for each beneficial
          owner, if any, on each line that applies): 

	 	  	 

	 ____	(1) 	 Any bank as defined in Section 3(a)(2) of the United States
          Securities Act of 1933, as amended (the "U.S. Securities Act")
          or any savings and loan association or other institution as defined
          in Section 3(a)(5)(A) of the U.S. Securities Act whether acting in its
          individual or fiduciary capacity; any broker or dealer registered pursuant
          to Section 15 of the U.S. Securities Exchange Act of 1934 or any insurance
          company as defined in Section 2(a)(13) of the U.S. Securities Act; any
          investment company registered under the U.S. Investment Company Act
          of 1940 or a business development company as defined in Section 2(a)(48)
          of that Act; any Small Business Investment Company licensed by the U.S.
          Small Business Administration under Section 301(c) or (d) of the U.S.
          Small Business Investment Act of 1958; any plan established and maintained
          by a state, its political subdivisions, or any agency or instrumentality
          of a state or its political subdivisions, for the benefit of its employees
          if such plan has total assets in excess of US$5,000,000; any employee
          benefit plan within the meaning of the U.S. Employee Retirement Income
          Security Act of 1974 if the investment decision is made by a plan fiduciary,
          as defined in Section 3(21) of such Act, which is either a bank, savings
          and loan association, insurance company, or registered investment adviser,
          or if the employee benefit plan has total assets in excess of US$5,000,000,
          or, if a self-directed plan, with investment decisions made solely by
          persons that are "accredited investors" (as such term is defined in
          Rule 501 of Regulation D of the U.S. Securities Act); 

	 	  	 

	 ____	(2) 	 Any private business development company as defined in
          Section 202(a)(22) of the U.S. Investment Advisers Act of 1940; 

	 	  	 

	 ____	(3) 	 Any organization described in Section 501(c)(3) of the
          U.S. Internal Revenue Code, corporation, Massachusetts or similar business
          trust, or partnership, not formed for the specific purpose of acquiring
          the securities offered, with total assets in excess of US$5,000,000;
        

	 	  	 

	 ____	(4) 	 Any trust with total assets in excess of US$5,000,000,
          not formed for the specific purpose of acquiring the securities offered,
          whose purchase is directed by a sophisticated person (being defined
          as a person who has such knowledge and experience in financial and business
          matters that he or she is capable of evaluating the merits and risks
          of the prospective investment); 

	 	  	 

	 ____	(5) 	 Any natural person whose individual net worth, or joint
          net worth with that person’s spouse, at the time of his purchase
          exceeds US$1,000,000, exclusive of the person’s primary residence;
        

	 	  	 

	 ____	(6) 	 Any natural person who had an individual income in excess
          of US$200,000 in each of the two most recent years or joint income with
          that person’s spouse in excess of US$300,000 in each of those years,
          and has a reasonable expectation of reaching the same income level in
          the current year; 

	 	  	 

	 ____	(7) 	 Any director or executive officer of the Issuer; or 

	 	  	 

	 ____	(8) 	 Any entity in which all of the equity owners meet the requirements
          of at least one of the above categories.

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