Document:

Participation Agreement

 Exhibit 10.44 
  
 PARTICIPATION AGREEMENT 
  
 FOR 
  
 OIL MINING LEASE 113, FEDERAL REPUBLIC OF NIGERIA 
  
 AMONG 
  
 YINKA FOLAWIYO PETROLEUM COMPANY LIMITED 
  
 SYNTROLEUM NIGERIA LIMITED 
  
 AND

  
 LUNDIN PETROLEUM B.V. 
  
 PALACE EXPLORATION COMPANY 
  
 CHALLENGER MINERALS INC. 
  
 PROVIDENCE RESOURCES P.L.C. 
  
 HOWARD ENERGY CO., INC. 
  
 AS FARMEES 
  
 DATED 12 JANUARY 2005 
  

  
 TABLE
OF CONTENTS 
  

					
		
	 ARTICLE 1 DEFINITIONS
	  	1
		
	 ARTICLE 2 ASSIGNMENT OF INTEREST
	  	6
			
	 2.1
	  	Grant	  	6
			
	 2.2
	  	Reservation	  	7
			
	 2.3
	  	Deed of Assignment	  	8
			
	 2.4
	  	Joint Operating Agreement	  	8
			
	 2.5
	  	Operator and Technical Advisor	  	8
			
	 2.6
	  	Technical Assistance Agreement	  	8
			
	 2.7
	  	Parent Company Guarantee	  	8
			
	 2.8
	  	AMI Agreement	  	8
			
	 2.9
	  	Submission to Ministry	  	9
			
	 2.10
	  	Ownership	  	9
			
	 2.11
	  	Binding Effect	  	9
		
	 ARTICLE 3 CONDITIONS PRECEDENT TO ASSIGNMENT
	  	9
			
	 3.1
	  	Conditions	  	9
			
	 3.2
	  	Termination / Withdrawal	  	9
			
	 3.3
	  	Acts to be Performed	  	10
		
	 ARTICLE 4 CONSIDERATION
	  	10
			
	 4.1
	  	Consideration	  	10
			
	 4.2
	  	Work Commitments	  	10
			
	 4.3
	  	Deemed Completion	  	17
			
	 4.4
	  	Right to Audit	  	17
			
	 4.5
	  	Transfer Fees	  	17
			
	 4.6
	  	Indemnification	  	18
		
	 ARTICLE 5 OBLIGATIONS UNDER CONTRACT
	  	18
			
	 5.1
	  	Acceptance of Terms	  	18
		
	 ARTICLE 6 UNDERTAKING OF THE PARTIES
	  	18
			
	 6.1
	  	YFP Obligations	  	18
			
	 6.2
	  	Mutual Obligations	  	20
		
	 ARTICLE 7 REPRESENTATIONS AND WARRANTIES OF THE PARTIES
	  	20
			
	 7.1
	  	YFP and Syntroleum Representations and Warranties	  	20

  

 i 

					
	 7.2
	  	Farmees’s Representations and Warranties	  	22
			
	 7.3
	  	Mutual Representations and Warranties	  	22
			
	 7.4
	  	Disclaimer of Other Representations and Warranties	  	23
		
	 ARTICLE 8 AREA OF MUTUAL INTEREST
	  	23
		
	 ARTICLE 9 TAX
	  	23
			
	 9.1
	  	Tax Obligations	  	23
			
	 9.2
	  	Joint Levy	  	24
			
	 9.3
	  	United States Tax Election	  	24
		
	 ARTICLE 10 CONFIDENTIALITY
	  	25
			
	 10.1
	  	Confidential Information	  	25
			
	 10.2
	  	No Disclosure	  	25
		
	 ARTICLE 11 NOTICES
	  	26
		
	 ARTICLE 12 LAW AND DISPUTE RESOLUTION
	  	27
			
	 12.1
	  	Governing Law	  	27
			
	 12.2
	  	Dispute Resolution	  	27
		
	 ARTICLE 13 FORCE MAJEURE
	  	27
			
	 13.1
	  	Right to Suspend Obligations	  	27
			
	 13.2
	  	Definition	  	28
		
	 ARTICLE 14 GENERAL PROVISIONS
	  	28
			
	 14.1
	  	Relationship of Parties	  	28
			
	 14.2
	  	Assignment	  	28
			
	 14.3
	  	Further Assurances	  	28
			
	 14.4
	  	Waiver	  	28
			
	 14.5
	  	Joint Preparation	  	29
			
	 14.6
	  	Severance of Invalid Provisions	  	29
			
	 14.7
	  	Modifications	  	29
			
	 14.8
	  	Priority of Agreement	  	29
			
	 14.9
	  	Interpretation	  	29
			
	 14.10
	  	Counterpart Execution	  	30
			
	 14.11
	  	Public Announcements	  	30
			
	 14.12
	  	Third Parties	  	30
			
	 14.13
	  	Consequential Loss	  	30
			
	 14.14
	  	Entirety	  	30

  

 ii 

 ATTACHMENTS 
  

			
	 A.
	  	COPY OF OML 113 LEASE INSTRUMENT
		
	 B.
	  	FORM OF DEED OF ASSIGNMENT
		
	 C.
	  	FORM OF JOINT OPERATING AGREEMENT
		
	 D.
	  	FORM OF TECHNICAL ASSISTANCE AGREEMENT
		
	 E.
	  	FORM OF GUARANTEE
		
	 F.
	  	FORM OF LETTER OF CREDIT
		
	 G.
	  	FORM OF CONVEYANCE OF OVERRIDING ROYALTY INTEREST
		
	 H.
	  	ADTI TURNKEY DRILLING PROPOSAL
		
	 I.
	  	FORM OF AREA OF MUTUAL AGREEMENT

  
 SCHEDULES 
 2.1(A) 
  
 2.2(B)(iii) 
  
 4.1 
  

 iii 

  
 PARTICIPATION AGREEMENT

  
 This Participation Agreement is entered into on the
         day of January 2005 by and among: 
  
 Yinka Folawiyo Petroleum Company Limited, a company existing under the laws of the Federal Republic of Nigeria, (“YFP”); 
  
 Syntroleum Nigeria Limited, a company existing under the laws of the Federal Republic of Nigeria (“Syntroleum”);

  
 Lundin Petroleum B.V., a company existing under the laws of
The Netherlands (“Lundin”); 
  
 Palace Exploration
Company, a company incorporated in the State of Oklahoma, USA (“Palace”); 
  
 Challenger Minerals Inc., a company existing under the laws of the State of California USA (“Challenger”); 
  
 Providence Resources p.l.c., a company existing under the laws of Ireland (“Providence”); and 
  
 Howard Energy Co., Inc., a company incorporated in the State of Delaware,
USA (“Howard”), (Lundin, Palace, Challenger, Providence and Howard, if not a Nigerian company intend to incorporate a subsidiary in Nigeria to hold its interest in the Lease and the JOA, are collectively referred to as
“Farmees”), 
  
 And is premised on the fact that: 
  
 The Lease was granted by the Ministry to YFP; and 
  
 As of the date of this Agreement, YFP holds one hundred percent (100%) of the legal and
beneficial interest in the Lease and the Lease Area; and 
  
 YFP is willing to
assign and transfer certain undivided interests in their rights and obligations under the Lease, to Farmees and Syntroleum, and Farmees and Syntroleum wish to acquire such interests in accordance with the terms and conditions set out in this
Agreement. 
  
 In consideration of the premises set out above and the provisions
set out below, YFP, Syntroleum and Farmees agree as follows: 
  
 ARTICLE 1 
 DEFINITIONS 
  
 As used in this Agreement, the following capitalized words and terms shall have the meaning ascribed to them below. Any capitalized term used in this Agreement and not
specifically defined in this Agreement shall have the same meaning as in the Lease or the JOA. 
  
 Additional Wells means up to four additional wells which may be drilled on the Lease after the plugging and abandonment or temporary abandonment of the Second Well. 
  
 ADTI Proposal shall have the meaning ascribed in Schedule 2.1(A)(i)(x). 
  
 Affiliate means in relation to any Party, any company, partnership or other entity
that Controls or is Controlled by that Party or is Controlled by a company, partnership or other entity which Controls that Party. 
  
 Agreement means this Participation Agreement together with the attachments appended to this document, and any extension, renewal or amendment hereof agreed to in
writing by the Parties. 
  
 Aje Commercial Bonus means the amount paid by
Syntroleum and the Farmees to YFP after the first Declaration of Commerciality for the Lease as provided under Schedule 4.1(D). 
  
 Aje Field means the Hydrocarbon accumulation located within the boundaries of the Lease as more particularly described in Attachment B to the JOA. 
  

 1 

	AMI	Agreement means the Area of Mutual Interest Agreement attached as Attachment I. 

  

	Approval	Date means the date on which the Conditions Precedent are satisfied. 

  

	Available	Production means the total quantity of Hydrocarbons produced and saved from all fields in the Lease Area, less the 

	quantities	used, reinjected or lost in operations with respect to the Lease or taken as Royalty in kind. 

  
 Capital Expenditures mean all costs and expenses related to Joint Operations, which are qualifying capital expenditures under the
provisions of the PPTA or CITA, including without limitation expenditures of a capital nature including, inter alia both tangible and intangible expenditures incurred for the acquisition, constructions, and erection of Joint Property, the
drilling and completion of wells, the acquisition and processing (and reprocessing) of seismic and geological and geophysical studies by third parties. 
  
 Capex Paying Interest means as to each Party its percentage share of all obligations and liabilities for Capital Expenditures. 
  
 CITA means the Companies Income Tax Act, Cap.60 Laws of the Federal Republic of
Nigeria, as amended from time to time. 
  
 Commercial Discovery means any
Discovery located in the Lease Area that the Parties deem to have sufficient commercial worth to such Parties to warrant the preparation of a Development Plan for such Hydrocarbon accumulation and the submission of such Development Plan to the
applicable Government authorities for authorization to commence exploitation. 
  
 Commercial Production means the production of Hydrocarbons from a Commercial Discovery under a Development Plan approved by the Government. 
  
 Conditions Precedent means the conditions set out in Article 3.1. 
  
 Consideration has the meaning given in Article 4. 
  
 Continuing Participants shall have the meaning ascribed in Article 3.2(A). 
  

Control means the right to exercise, directly or indirectly, more than fifty percent (50%) of the voting rights of a company or other entity, and
Controlled shall be construed accordingly. 
  
 Cost Bearing
Participation means as to each Party its Capex Paying Interest and its Opex Paying Interest. 
  
 Cost Recovery Account means an account established and maintained by the Technical Advisor in accordance with this Agreement into which eighty percent (80%) of the Net Proceeds from each sale of Hydrocarbons
shall be paid, and from which the Parties shall be entitled to recover their respective allocations of Prior Costs and their respective Cost Recovery Interest shares of Capital Expenditures and Operating Expenditures, actually incurred, plus
interest. 
  
 Cost Recovery Interest means as to each Party its percentage
share of the Cost Recovery Account. 
  
 Crude Oil means hydrocarbons that
at atmospheric temperature and pressure are in a liquid state, including crude mineral oil, asphalt, and ozokerites, and liquid hydrocarbons that are obtained by separation, treatment, processing or extraction, including in any event all condensates
and Natural Gas liquids, and which liquids are subject to and covered by the Lease and including any Hydrocarbons which are not Natural Gas. 
  
 Cumulative Expenditures mean as to each Party the total costs and expenses attributable to such Party’s Cost Bearing Participation that such Party has
actually incurred, including Capital Expenditures, Operating Expenditures, Royalty and Taxes, plus such Party’s share of Prior Costs, including any adjustment, plus interest on YFP’s Carried Participation, but excluding any amounts such
Party paid as Signature Bonus, Development Bonus, or Aje Commercial Bonus. 
  
 Deed of Assignment means the document, attached as Attachment B, by which YFP will transfer and convey to Syntroleum and to the Farmees the Participating Interests in the Lease as provided under this Agreement. 
  

 2 

 Declaration of Commerciality means the written declaration to YFP made in the sole discretion of Syntroleum and
the Farmees after the completion of the drilling of the Initial Well, the Second Well, or any of the Additional Wells that the Aje Field or another field in the Lease Area is a Commercial Discovery and warrants the preparation and submission of a
plan of development to the Ministry for its approval. 
  
 Development Bonus
means the amount of USD$11,250,000.00 paid by the Farmees to YFP and Syntroleum as provided under Schedule 4.1(E). 
  
 Development Plan means a plan for the development of Hydrocarbons from an Exploitation Area. 
  
 Discovery means the discovery of an accumulation of Hydrocarbons whose existence in the Lease Area was previously unproven by
drilling, including without limitation the Aje Field. 
  
 Extension Bonus
means the amount of USD$2,000,000.00 paid by Syntroleum and the Farmees to YFP as provided under Schedule 4.1(C). 
  
 Effective Date means the date this Agreement comes into effect as set out in Article 2.11. 
  
 Electromagnetic Survey means an electromagnetic survey the conduct of which is commenced in accordance with and subject to the
provisions of Article 4.2. 
  
 Government means the government of the
Federal Republic of Nigeria and of any political subdivision of the Federal Republic of Nigeria, including without limitation any ministry, department, agency, state owned or operated company or organization, such as the Nigerian National Petroleum
Corporation and its Affiliates, or any other instrumentality of any such government. 
  
 Governmental Delay means any delay suffered by a Party in the performance of its obligations under this Agreement caused by the relevant agencies of the Government failing to grant timely approval of the environmental impact
assessment or any other permits or approvals required in order for such Party to perform its obligations under this Agreement. 
  
 HOA means the Heads of Agreement dated 27 August 2004 between YFP and Syntroleum. 
  
 Hydrocarbons mean Crude Oil and Natural Gas, including without limitation the products resulting from the processing of Natural Gas
using the Syntroleum GTL Process. 
  
 Initial Well means a well within the
Aje Field, the drilling of which is commenced in accordance with and subject to the provisions of Article 4.2. 
  
 Interim Period means the period commencing from the date of the execution of this Agreement until the Approval Date. 
  
 JOA means the Joint Operating Agreement attached as Attachment C. 
  
 Joint Operations means those operations and activities carried out by Operator and/or Technical Advisor pursuant to the JOA, the costs of which are chargeable to
all Parties in accordance with their respective Cost Bearing Participations. 
  
 Joint Property means, at any point in time, all wells, facilities, equipment, materials, information, funds and property held for use in Joint Operations. 
  
 JVA means the Joint Venture Agreement dated 7 October 2004 between YFP and Syntroleum. 
  
 Laws/Regulations mean those laws, statutes, rules and regulations governing activities
under the Lease. 
  
 Lease means the Oil Mining Lease No. 113
concluded between the Government and YFP and any extension, renewal or amendment thereof and those laws, statutes, rules and regulations with respect to the exploration, development and production of Hydrocarbons that govern such instrument or are
incorporated by the terms of such instrument, a copy of which instrument is set out in Attachment A. 
  

 3 

 Lease Area means as of the Effective Date the surface area which is described in Attachment B to the JOA. The
perimeter or perimeters of the Lease Area shall correspond to that area covered by the Lease, as the area may vary from time to time during the term of validity of the Lease. 
  
 Letter of Credit means a letter of credit in the form and amount and on the terms and conditions set out in Attachment F. 

 
 Ministry means the Ministry of Petroleum Resources of the Government, and any
successor in interest under the applicable Laws/Regulations pertaining to Crude Oil and Natural Gas. 
  
 Natural Gas means hydrocarbons that at a standard temperature of sixty degrees Fahrenheit (60°F) and a standard pressure of one atmosphere are in a gaseous state, including wet mineral gas and dry mineral
gas, casinghead gas, wet gas and residual gas remaining after separation, treatment, processing, or extraction of liquid hydrocarbons, as well as non-hydrocarbon gas or gases produced in association with liquid or gaseous hydrocarbons, which
hydrocarbon and non-hydrocarbon gases are subject to and covered by the Lease. 
  
 Net Proceeds means an amount equal to the proceeds for the Hydrocarbons produced from the Lease Area and sold (including Hydrocarbon products and liquids separated, extracted, or manufactured through treatment or processing,
including the Syntroleum GTL Process), less all payments with respect to such Hydrocarbons for Royalties, Taxes assessed for the Lease Area under the PPTA, Taxes assessed for the Lease Area under the CITA, Taxes assessed for the Lease Area otherwise
related to production, any production bonuses, and Lease rentals. 
  
 Operating
Expenditures mean all costs and expenses related to Joint Operations, other than Capital Expenditures. 
  
 Operator means a Party to this Agreement designated as such in accordance with Article 4 of the JOA. 
  
 Opex Paying Interest means as to each Party its percentage share of all obligations and liabilities for Operating Expenditures. 
  
 ORIs means the overriding royalty interests granted pursuant to Article 4.1(D).

  
 Parent Company Guarantee means as to each Party a guarantee in the form
set out in Attachment E in which the Nigerian subsidiary of such Party that signs the JOA and the TAA is the guaranteed party and the ultimate parent company is the guaranteeing party. 
  
 Participating Interest means as to each Party its percentage interest in the undivided ownership, rights, benefits, duties,
obligations and liabilities relating to the Lease, and its corresponding interest relating to this Agreement, the JOA, and the TAA, which interest shall consist of two components referred to in this Agreement and the JOA as Revenue Participation and
Cost Bearing Participation. 
  
 Parties mean the signatories to this
Agreement and any successors or transferees permitted under this Agreement, and Party means any one of them. 
  
 Payout Factor means as to each Party the number, calculated to four decimal places, equal to such Party’s cumulative Net Proceeds divided by such Party’s
Cumulative Expenditures. 
  
 Person means any individual, corporation,
partnership, joint venture, association, trust, estate, autonomous governmental organization, or any agency or political subdivision of a government. 
  
 PPTA means the Petroleum Profits Tax Act, Cap.354 of the laws of the Federal Republic of Nigeria (LFN) 1990, as amended from time to time. 
  
 Prior Costs means those costs incurred prior to the Effective Date by YFP or its
predecessors in interest in exploring and operating the Lease, including but not limited to all costs incurred in (a) drilling the wells identified as the Aje #1 and Aje #2 wells on the Lease, and (b) acquiring the 2-D and 3-D seismic over the Lease
Area, but excluding any signature bonus paid by YFP in connection with the Lease, which YFP transfers to the Parties other than YFP pursuant to this Agreement. 
  

 4 

 Profit Account means an account established and maintained by the Technical Advisor in accordance with this
Agreement into which twenty percent (20%) of the Net Proceeds from each sale of Hydrocarbons shall be paid plus the excess of the Cost Recovery Account as provided in Schedule 2.1(A)(iii)(z), and from which the Parties shall be entitled to receive
their respective Profit Sharing Interest shares. 
  
 Profit Sharing
Interest means as to each Party its percentage share of the Profit Account. 
  
 Project Payout means any period of time when the Payout Factor of each Party, other than YFP, is at least equal to one (1). 
  
 Revenue Participation means as to each Party its Cost Recovery Interest and its Profit Sharing Interest. 
  
 Rig Unavailability means with respect to any Party that such Party has made a
reasonable commercial effort but has been unable to enter into a contract for a suitable drilling rig by the date that is one hundred and twenty (120) days before the one year anniversary date of the Approval Date that, in accordance with good
international petroleum industry practices and standards, meets all of the following conditions: (a) designed, equipped, and staffed to operate in the environment in which it will be operating; (b) designed to safely, effectively and efficiently
drill to the minimum agreed depth of the Initial Well, Second Well or Additional Wells, as the case may be; (c) capable of performing such functions and other activities as may be reasonably necessary or desirable in connection with the drilling,
logging and testing of the wells; (d) available to be on the well location within the Lease to commence drilling operations within thirty (30) days of the date specified for the commencement of such drilling operations in the work program and budget
approved in accordance with provisions of the JOA; and (e) may be leased under the generally accepted terms and conditions of an international drilling rig contract and providing for a contract lease rate which is not in excess of the prevailing
rate for such rigs, including charges for mobilization and demobilization. 
  
 Royalty means the amount of royalty payable to the Government pursuant to the applicable laws and regulations of the Federal Republic of Nigeria, as amended from time to time, on production of Hydrocarbons from the Lease. 

 
 Second Well means the second well that may be drilled in accordance with and
subject to the provisions of Article 4.2 of this Agreement. 
  
 Shallow Water
Option means the right of YFP to make a one-time election to increase its Revenue Participation in the Shallow Water Option Area pursuant to the provisions of Article 2.2(B). 
  
 Shallow Water Option Area means that portion of the Lease Area that is both (i) outside of the boundaries of the Aje Field, and (ii)
at a water depth of less than 100 meters. 
  
 Signature Bonus means the
cash paid to YFP and Syntroleum pursuant to Schedule 4.1(B) by the Farmees in partial consideration for this Agreement and the transfer and assignment to Syntroleum, Lundin, Palace, Challenger, Providence and Howard of their respective Participating
Interests. 
  
 Syntroleum GTL Process means the proprietary process for the
conversion of natural gas to liquids, which process is owned by Syntroleum and its parent companies. 
  
 Taxes means all taxes, assessments, duties, fees, levies or other charges of any nature imposed by Government, including without limitation CITA tax, PPTA tax, income tax, value added tax, surtax, remittance
tax, presumptive tax, net worth tax, special contribution, production tax, severance tax, gas flaring tax, carbon or environmental tax, transportation tax, withholding tax, gross proceeds or receipts tax, profits tax, windfall profits tax, personal
property tax, real property tax, sales tax, service tax, transfer tax, use tax, excise tax, premium tax, customs duties, stamp tax, motor vehicle tax, entertainment tax, insurance tax, capital stock tax, franchise tax, occupation tax, payroll tax,
education tax, employment tax, social security, labor participation, unemployment tax, disability tax, alternative or add-on minimum tax, and estimated tax, together with any interest, fine or penalty on such Tax. 
  
 TAA means the Technical Assistance Agreement attached as Attachment D. 
  

 5 

	Technical	Advisor means a Party to this Agreement designated as such in accordance with Article 4 of the JOA. 

  

	Work	Commitment means those work and/or expenditure obligations of Farmees and Syntroleum specified in Article 4.2. 

  

	YFP	means Yinka Folawiyo Petroleum Company Limited. 

  
 YFP’s Carried Participation means the benefit accruing to YFP as a result of the Parties other than YFP bearing the costs, liabilities and obligations (other
than bonuses, Royalties and Taxes under the Lease) attributable to the difference between YFP’s Revenue Participation and YFP’s Cost Bearing Participation. 
  
 YFP’s Carried Participation Interest Rate means interest compounded on a monthly basis, at the rate per annum equal to the one
(1) month term, London Interbank Offered Rate (LIBOR) for U.S. dollar deposits, as published by The Wall Street Journal or if not so published, then by the Financial Times of London, plus two (2) percentage points, applicable on the first Business
Day prior to the due date of payment and thereafter on the first Business Day of each succeeding calendar month. If the aforesaid rate is contrary to any applicable usury law, the rate of interest to be charged shall be the maximum rate permitted by
such applicable law. 
  
 YFP Cost Recovery Payout means the point in time
when the total amount attributable to YFP’s Cost Recovery Interest that YFP has actually received equals the total amount of YFP’s allocated share of Prior Costs. 
  
 Zone means a stratum of earth containing or thought to contain an accumulation of Hydrocarbons separately producible from any other
accumulation of Hydrocarbons. 
  
 ARTICLE 2 
 ASSIGNMENT OF INTEREST 
  

	2.1	Grant 

  
 Subject to the satisfaction of the Conditions Precedent, and in exchange for the Consideration: 
  

	 	A.	YFP shall transfer to Syntroleum and to each of the Farmees, and Syntroleum and each of the Farmees agree to accept such Party’s Participating Interest in the Lease, including
the Cost Bearing Participation and Revenue Participation, as set out Schedule 2.1A(i). 

  

	 	B.	YFP shall transfer to Syntroleum and to each of the Farmees, and Syntroleum and each of the Farmees agree to accept such Party’s Profit Sharing Interest share and estimated as
set out below, in (1) the Prior Costs, and such Prior Costs shall be treated as Capital Expenditures and recovered by Syntroleum and the Farmees in accordance with Schedule 2.1(A)(i) notwithstanding Schedule 2.1(A)(ii); and (2) to the extent
permitted by Nigerian law the tax loss carry forward amounts arising from Prior Costs. YFP estimates that the Prior Costs as of the Effective Date total US$82,000,000. The Parties other than YFP shall have the right to audit the books of YFP to
verify the Prior Costs, and such Parties acknowledge that the actual amount of the tax loss carry forward is subject to Government audit. 

  

	 	C.	 Prior to commencement of Commercial Production YFP shall provide free of charge to the Technical Advisor and Syntroleum office space in the offices of YFP located
at the Yinka Folawiyo Plaza, in Lagos Nigeria reasonably sufficient to house the staff of the Technical Advisor and Syntroleum that are required to undertake the operations required to be performed under the terms of this Agreement and the JOA.
Additionally, YFP shall provide to the Technical Advisor and Syntroleum such other logistical and office support reasonably necessary to enable the staff of the Technical Advisor and Syntroleum to fully and efficiently perform their activities.
During the period beginning on the Effective Date and ending on the Approval Date Syntroleum and the Farmees, in proportion to their Opex Paying Interests, shall pay to YFP an amount of thirty thousand dollars 

  

 6 

	 	 
(US$30,000) per month to reimburse YFP for its costs incurred in maintaining an office to support activities undertaken with respect to the Lease. During the
period beginning after the day after the Approval Date and ending on the date of commencement of Commercial Production Syntroleum and the Farmees, in proportion to their Opex Paying Interests, shall pay to YFP an amount of fifty thousand dollars
(US$50,000) per month (paid in advance on the first Day of each month) to reimburse YFP such office costs. After the commencement of Commercial Production the Farmees shall have no further obligation to make any payment to YFP under this Article
2.1(C) to reimburse YFP for office costs, and on commencement of Commercial Production YFP shall have no further obligation to provide to the Technical Advisor and Syntroleum office space and logistical support under the provisions of this Article
2.1(C). This Article 2.1(C) is personal to the Technical Advisor and Syntroleum, and their subcontractors and may not be assigned. 

  

	 	D.	The Farmees and Syntroleum shall execute and deliver the overriding royalty interests in the form set out in Attachment G. 

  

	2.2	Reservation 

  
 Subject to this Agreement YFP reserves and shall be entitled to: 
  

	 	A.	YFP’s Carried Participation 

  

	 	(i)	The costs attributable to YFP’s Carried Participation shall be borne by the Parties (excluding YFP) in proportion to their respective Cost Bearing Participations as specified
in their respective Capex Paying Interest and Opex Paying Interest in Article 2.1, subject to Article 2.2(B). 

  

	 	(ii)	In the event that at least US$82,000,000 of the Prior Costs assigned under Article 2.1(B) do not provide to Syntroleum and the Farmees tax loss carry forward treatment, then the
costs attributable to YFP’s Carried Participation that are borne by the Parties (excluding YFP) shall bear interest at the YFP’s Carried Participation Interest Rate per annum as from the date on which such costs were incurred. Otherwise
the YFP Carried Participation shall not be subject to interest. 

  

	 	(iii)	The Parties that bear the costs attributable to YFP’s Carried Participation shall be entitled in proportion to their respective Cost Bearing Participations to be reimbursed
pursuant to Article 2.1(A) such costs, including interest under Article 2.2(A)(ii), after YFP Cost Recovery Payout from YFP’s Cost Recovery Interest. Such costs shall be reimbursed on the accounting basis of “first in, first out” with
respect to all other costs. 

  

	 	(iv)	Until Syntroleum and the Farmees obtain approval of a plan of development for the first Commercial Discovery YFP may not propose or conduct an Exclusive Operation under the JOA
other than in respect of the Shallow Water Option Area. If after approval of the plan of development for the first Commercial Discovery YFP proposes an Exclusive Operation other than for YFP’s Shallow Water Option set out in Article 2.2(B),
then as to such Exclusive Operation YFP’s Carried Participation shall end, and the initial presumed Capex Paying Interest and Opex Paying Interest of each Party with respect to such Exclusive Operation shall be as set out for the Opex Paying
Interests in Schedule 2.1(A)(iii)(y). 

  

	 	B.	YFP’s Shallow Water Option 

  

	 	(i)	 With respect only to the first Exploration Well drilled to a bottom hole location within the Shallow Water Option Area, YFP shall have the one time right (but not
any obligation), exercisable in accordance with Article 2.2(B)(ii), to convert YFP’s Carried Participation with respect to the Shallow Water Option Area to a sixty percent (60%) Cost Bearing Participation in all Joint Operations with respect to
the Shallow Water Option Area and a 

  

 7 

	 	 
sixty percent (60%) Revenue Participation in all net proceeds from the sale of Hydrocarbons produced from the Shallow Water Option Area.

  

	 	(ii)	YFP may exercise its right under Article 2.2(B)(i) by giving written notice to the other Parties within twenty-four (24) hours after Operator notifies the Parties that the first
Exploration Well in the Shallow Water Option Area has reached casing point specifying that YFP elects to exercise such right. 

  

	 	(iii)	If YFP properly and timely exercises its right under Article 2.2(B)(i), then from and after the exercise of such right the Participating Interests of the Parties with respect to the
Shallow Water Option Area shall be as set out in Schedule 2.2(B)(iii): 

  

	 	(iv)	If YFP fails to properly and timely exercise its right under Article 2.2(B)(i), such right shall expire and YFP shall have no further rights to modify its Cost Bearing Participation
or Revenue Participation. 

  

	2.3	Deed of Assignment 

  
 Contemporaneously with the signing of this Agreement (or as soon as reasonably practical following formation of all Parties’ Nigerian subsidiaries),
the Parties’ Nigerian subsidiaries shall sign the Deed of Assignment set out in Attachment B. Subject to termination under Article 3.2, the Deed of Assignment shall be effective on the Approval Date. 
  

	2.4	Joint Operating Agreement 

  
 Contemporaneously with the signing of this Agreement (or as soon as reasonably practical following formation of all Parties’ Nigerian subsidiaries),
the Parties or their Nigerian subsidiaries, as the case may be, shall sign the JOA set out in Attachment C. Subject to termination under Article 3.2, the JOA shall be effective on the Approval Date. 
  

	2.5	Operator and Technical Advisor 

  
 YFP, with the assistance of the Farmees and Syntroleum, agrees to seek approval from the appropriate Government authorities to the appointment of the
Technical Advisor having the rights and obligations specified in the JOA. 
  

	2.6	Technical Assistance Agreement 

  
 Contemporaneously with the signing of this Agreement (or as soon as reasonably practical following formation of all Parties’ Nigerian subsidiaries),
the Parties or their Nigerian subsidiaries, as the case may be, shall sign the TAA set out in Attachment D. Subject to termination under Article 3.2, the TAA shall be effective on the Approval Date. 
  

	2.7	Parent Company Guarantee 

  
 Contemporaneously with the signing of this Agreement (or as soon as reasonably practical following formation of all Parties’ Nigerian subsidiaries),
the ultimate parent company of each Party’s Nigerian subsidiaries shall sign the Parent Company Guarantee set out in Attachment E. Subject to termination under Article 3.2, the Parent Company Guarantee shall be effective on the Approval Date.

  

	2.8	AMI Agreement 

  
 Contemporaneously with the signing of this Agreement (or as soon as reasonably practical following formation of all Parties’ Nigerian subsidiaries),
the Parties or their Nigerian subsidiaries, as the case may be, shall sign the AMI Agreement set out in Attachment I. 
  

 8 

	2.9	Submission to Ministry 

  
 Within five (5) days after the receipt of the Deed of Assignment executed by the Parties or their Nigerian subsidiaries, as the case may be, YFP shall
submit to the Ministry the Deed of Assignment, together with the JOA and the TAA executed by the Parties or their Nigerian subsidiaries, as the case may be. 
  

	2.10	Ownership 

  
 Subject to termination under Article 3.2, after the Approval Date, the Participating Interests, including the Cost Bearing Participation and the Revenue
Participation, in the Lease, the JOA and the TAA (including the wells and other assets) shall be as set out in the JOA and this Agreement. 
  

	2.11	Binding Effect 

  
 YFP, Syntroleum and the Farmees shall be bound by this Agreement from and after the date this Agreement is signed by all Parties (“Effective
Date”) and shall fully perform all of their respective obligations under this Agreement. 
  
 ARTICLE 3 
 CONDITIONS PRECEDENT TO ASSIGNMENT 
  

	3.1	Conditions 

  
 Syntroleum and the Farmees may terminate their rights and obligations in this Agreement, the Deed of Assignment, the JOA, and the TAA in accordance with
Article 3.2, if the following conditions (“Conditions Precedent”) are not satisfied by 1 March 2006: 
  

	 	A.	YFP shall have obtained in writing from the Government approval of the transfer of the Participating Interests under the Deed of Assignment as required under the Lease and
applicable laws; and 

  

	 	B.	YFP and/or its Technical Advisor shall have obtained in writing from the Government the issuance of the drilling permit for the Initial Well. 

  

	3.2	Termination / Withdrawal 

  

	 	A.	If the Conditions Precedent have not been satisfied by 1 March 2006, then any of the Farmees and Syntroleum may withdraw from this Agreement without any further obligation or
liability to the other Parties in accordance with the provisions of Article 3.2(C); provided that if one or more (but less than all) Farmees and/or Syntroleum are willing to continue this Agreement (“Continuing Participants”), then
the Continuing Participants shall have the option exercisable within thirty (30) days of receipt of the notice of such withdrawal by notice to YFP to assume the rights, obligations and liabilities of all such withdrawing Parties under this
Agreement, the JOA and the TAA in proportion to the Participating Interests of the Continuing Participants or other proportion as they may agree. In the event there are no Continuing Participants as provided above, then this Agreement shall
terminate. 

  

	 	B.	If in the course of the approval process: 

  

	 	(i)	The Government does not approve the transfer of the Participating Interests under the Deed of Assignment or approves such transfer subject to any conditions or revisions; or

  

	 	(ii)	The Government does not issue the drilling permit for the Initial Well, or issues such permit subject to conditions or revisions unacceptable to the Technical Advisor,

  
 which conditions or revisions the Parties are
not willing to accept, then the Parties will endeavor to agree unanimously on a response to the proposed conditions or revisions within the time frame 

  

 9 

 
allowed under the circumstances or thirty (30) days whichever is shorter. If the Parties are unable to so agree or if the Government refuses to modify such
conditions or revisions, then any Party other than YFP that does not want to accept the proposed conditions or revisions may withdraw from this Agreement without any further obligation or liability to the other Parties in accordance with the
provisions of Article 3.2(C); provided that if one or more (but less than all) Parties are willing to accept such proposed revisions or conditions, then the Parties other than YFP willing to accept such conditions or revisions shall have the option
exercisable within thirty (30) days of receipt of such notice of withdrawal by notice to YFP to assume the rights, obligations and liabilities of all withdrawing Parties under this Agreement, the JOA and the TAA in such proportion as the continuing
Parties may agree and the withdrawing Parties shall be deemed to have withdrawn from this Agreement, the Deed of Assignment, the JOA and the TAA in the manner contemplated by Article 13 of the JOA. In the event all of the Parties other than YFP
withdraw, then this Agreement shall terminate. 
  

	 	C.	In the event of termination of this Agreement pursuant to this Article 3.2: 

  

	 	(i)	The Deed of Assignment, the JOA and the TAA shall terminate, shall be rendered void and shall have no force or effect. 

  

	 	(ii)	The Parties other than YFP shall have no interest whatsoever in the Lease, and shall be deemed to have reassigned any rights or equitable interest they may have acquired under this
Agreement to YFP as of the date of termination of this Agreement. 

  

	 	(iii)	The Parties shall cause the bank to cancel and return the Letter of Credit to the Farmees and Syntroleum, but YFP shall have no obligation to reimburse any charges paid to the bank
for the Letter of Credit. 

  

	3.3	Acts to be Performed 

  
 YFP shall be primarily responsible for ensuring that the Conditions Precedent are satisfied as soon as reasonably practicable after the execution of this
Agreement, and Syntroleum and the Farmees shall provide all reasonable assistance to YFP in accomplishing such responsibility. Each Party shall use commercially reasonable efforts to execute all documents, and do and procure to be done all such acts
and things as are reasonably within its power to ensure the Conditions Precedent are satisfied as soon as is reasonably practicable after execution of this Agreement. 
  
 ARTICLE 4 
 CONSIDERATION 
  

	4.1	Consideration 

  
 In consideration for receiving the assignment of the Participating Interests the Parties agree to comply with the provisions of Schedule 4.1. 

 

	4.2	Work Commitments 

  

	 	A.	 In the interest of (1) defining the optimum location for the Initial Well and the Second Well and (2) initiating the investigation of the potential of associated
structures in the Lease Area the Parties agree to conduct due diligence concerning the desirability of conducting an Electromagnetic Survey. In the event Syntroleum and the Farmees agree that the Electromagnetic Survey should be conducted the
Parties shall pay their respective Cost Bearing Participation shares of such survey as specified in Schedule 2.1(A)(i)(x). The Parties agree that the results of the Electromagnetic Survey are not a condition to the drilling of the Initial Well and
that the electromagnetic survey shall not delay the drilling of the Initial Well. The Technical Advisor shall be 

  

 10 

	 	 
responsible for the carrying out of the Electromagnetic Survey as described above and all related work associated with the preparation of the drilling of the
Initial or Second Wells. 

  

	 	(i)	For the purposes of the preceding work and any other operations conducted during the Interim Period, the JOA shall be deemed to apply amongst the Farmees and Syntroleum, including
the right and duty of the Technical Advisor to submit budgets and AFEs and to cash call. If either Syntroleum or any of the Farmees fails to pay any cash call issued in respect of its Cost Bearing Participation share of operations undertaken during
the Interim Period, then such Party shall be subject to all the default provisions in the JOA. 

  

	 	(ii)	From the Approval Date the data obtained in such Electromagnetic Survey may be proprietary data jointly owned by the Parties. If any third party wants to acquire the right to use
such proprietary data, Syntroleum and the Farmees may license or sell such proprietary data and in such event shall share the royalties or other proceeds among Syntroleum and the Farmees in proportion to their respective Cost Bearing Participation
shares set out in Schedule 2.1(A)(i)(x). Nothing set out in this provision shall limit the right of Syntroleum or the Farmees to use such proprietary data or to disclose such proprietary data to third parties without providing copies of the data to
the third parties. YFP may at any time, to the extent required under applicable laws, rules and regulations file such Survey with the Government. 

  

	 	B.	Subject to the provisions of this Article 4.2 Syntroleum and the Farmees shall cause ADTI to commence the drilling of the Initial Well by February 15, 2006 under a turnkey drilling
contract on the terms and conditions set out in the ADTI Proposal. If the Approval Date is a date in excess of ninety (90) days from the date that YFP files the Deed of Assignment, the February 15, 2006 date to commence the drilling of the Initial
Well shall be extended by a period of time equal to the number of days in excess of ninety (90) days between the filing of the Deed of Assignment by YFP and the Approval Date. In addition, the obligation of Syntroleum and the Farmees to commence
drilling the Initial Well may be extended by reasons of Force Majeure, Rig Unavailability or Governmental Delay. 

  

	 	(i)	If Syntroleum and the Farmees fail to commence the drilling of the Initial Well by 15 February 2006, as such time period may be extended as provided in this Article 4.2(B), then:

  

	 	(1)	If Syntroleum has committed under Schedule 4.1(A)(iv) to drill the Initial Well, the Farmees shall be deemed to have withdrawn from the Lease, the JOA, the TAA and this Agreement
pursuant to Article 13 of the JOA as of the last day of such time period, shall cease to have any rights or obligations in respect of the Lease, the JOA, the TAA and this Agreement (provided that the Farmees shall remain responsible for their Cost
Bearing Participation share of any obligations undertaken or liabilities incurred under the JOA prior to such withdrawal), and the Farmees shall reassign and re-convey their respective Participating Interest in the Lease, the JOA, the TAA, and this
Agreement to Syntroleum at no cost to Syntroleum. 

  

	 	(2)	 If Syntroleum has not committed under Schedule 4.1(A)(iv) to drill the Initial Well, Syntroleum and the Farmees shall be deemed to have withdrawn from the Lease,
the JOA, the TAA, and this Agreement pursuant to Article 13 of the JOA as of the last day of such time period, shall cease to have any rights or obligations in respect of the Lease, the JOA, the TAA, and this Agreement (provided that the Parties
shall remain responsible for their Cost Bearing Participation share of any obligations undertaken or liabilities incurred under the JOA prior to such withdrawal), and Syntroleum and the Farmees shall reassign 

  

 11 

	 	 
and re-convey their respective Participating Interest in the Lease, the JOA, the TAA and this Agreement to YFP at no cost to YFP.

  

	 	(ii)	If Syntroleum and the Farmees drill, test and plug and abandon (permanently or temporarily at the Parties’ election as provided in the JOA) the Initial Well, then Syntroleum
and the Farmees may at any time after the completion of the drilling of the Initial Well and pursuant to the JOA make a Declaration of Commerciality and pay the Aje Commercial Bonus (nonetheless Commercial Production from the Lease shall not
commence until a Declaration of Commerciality has been properly made and the Aje Commercial Bonus paid); provided that: 

  

	 	(1)	the Farmees, collectively, shall have the right exercisable for one hundred eighty (180) days after the plugging and abandonment (permanently or temporarily) of the Initial Well to
determine to terminate their participation in the Lease, the JOA, the TAA and this Agreement, and in the event the Farmees so determine, the Farmees shall reassign and re-convey their Participating Interests in the Lease and the JOA to Syntroleum at
no cost to Syntroleum and shall have no further rights, obligations and liabilities under the Lease, the JOA, the TAA and this Agreement. 

  

	 	(2)	Syntroleum shall have the right exercisable for twelve (12) months after the plugging and abandonment (permanently or temporarily) of the Initial Well to determine to terminate its
participation in the Lease, the JOA, the TAA and this Agreement, and in the event Syntroleum so determines, Syntroleum shall reassign and re-convey its Participating Interest in the Lease and the JOA to the Farmees in proportion to their respective
Cost Bearing Participation shares under Schedule 2.1(A)(i)(x) at no cost to Farmees, or if the Farmees have withdrawn to YFP, and shall have no further rights, obligations and liabilities under the Lease, the JOA, the TAA and this Agreement.

  

	 	C.	Subject to the provisions of Article 4.2(B), within one hundred fifty (150) days after the plugging and abandonment (permanently or temporarily) of the Initial Well, the Parties
shall meet to discuss the results of the Initial Well, whether any Discovery warrants development and whether the Second Well should be drilled. Subject to the provisions of Article 4.2(B) within one hundred eighty (180) days after the plugging and
abandonment (temporarily or permanently) of the Initial Well the Farmees and Syntroleum shall notify YFP whether or not the Farmees and/or Syntroleum intend to commence the drilling of the Second Well, and if so Syntroleum and the Farmees shall
cause ADTI to commence drilling within twelve (12) months after the plugging and abandonment (permanently or temporarily) of the Initial Well under a turnkey drilling contract on terms and conditions substantially similar to the ADTI Proposal. The
obligation of Syntroleum and the Farmees to commence the drilling of the Second Well may be extended by reasons of Force Majeure, Rig Unavailability or Governmental Delay. 

  

	 	(i)	If Syntroleum and the Farmees have made a Declaration of Commerciality after the Initial Well, then the Second Well shall be drilled to a bottom hole location outside of the
boundaries of the Aje Field to be selected by Syntroleum and the Farmees in order to test a geological structure within the Lease Area other than the Aje Field. 

  

	 	(ii)	If Syntroleum and the Farmees have not made a Declaration of Commerciality after the Initial Well, then the Second Well shall be drilled to any bottom hole location selected by
Syntroleum and the Farmees in the Lease Area. 

  

	 	(iii)	 If Syntroleum and the Farmees notify YFP that they do not intend to drill the Second Well, then Syntroleum and the Farmees shall be deemed to have withdrawn from
the Lease, the JOA, the TAA, and this Agreement pursuant to Article 13 of the JOA as of the last day 

  

 12 

	 	 
of such time period, shall cease to have any rights or obligations or liabilities in respect of the Lease, the JOA, the TAA, and this Agreement (provided
that the Parties shall remain responsible for their respective Cost Bearing Participation share of any obligations undertaken or liabilities incurred under the JOA prior to such withdrawal), and Syntroleum and the Farmees shall reassign and
re-convey their respective Participating Interest in the Lease and the JOA to YFP at no cost to YFP. 

  

	 	(iv)	If Syntroleum notifies the Farmees that Syntroleum does not intend to drill the Second Well, then Syntroleum shall be deemed to have withdrawn from the Lease, the JOA, the TAA, and
this Agreement pursuant to Article 13 of the JOA as of the last day of such time period, shall cease to have any rights or obligations or liabilities in respect of the Lease, the JOA, the TAA, and this Agreement (provided that Syntroleum shall
remain responsible for its Cost Bearing Participation share of any obligations undertaken or liabilities incurred under the JOA prior to such withdrawal), and Syntroleum shall reassign and re-convey its Participating Interest in the Lease and the
JOA to the Farmees at no cost to the Farmees. 

  

	 	(v)	If the Farmees notify Syntroleum that they do not intend to drill the Second Well or the Farmees fail to notify YFP and Syntroleum that the Farmees intend to drill the Second Well
within one hundred and eighty (180) days after the plugging and abandonment (permanently or temporarily) of the Initial Well, as such time period may be extended as provided in this Article 4.2(C), then the Farmees shall be deemed to have withdrawn
from the Lease, the JOA, the TAA and this Agreement pursuant to Article 13 of the JOA as of the last day of such time period, shall cease to have any rights or obligations or liabilities in respect of the Lease, the JOA, the TAA and this Agreement
(provided that the withdrawing Farmees shall remain responsible for their respective Cost Bearing Participation share of any obligations undertaken or liabilities incurred under the JOA prior to such withdrawal), and the Farmees shall reassign and
re-convey their respective Participating Interest in the Lease and the JOA to Syntroleum at no cost to Syntroleum. 

  

	 	(vi)	If Syntroleum and/or the Farmees fail to commence the drilling of the Second Well within twelve (12) months after the plugging and abandonment (permanently or temporarily) of the
Initial Well, as such time period may be extended as provided in this Article 4.2(C), then Syntroleum and/or the Farmees shall be deemed to have withdrawn from the Lease, the JOA, the TAA and this Agreement pursuant to Article 13 of the JOA as of
the last day of such time period, shall cease to have any rights or obligations or liabilities in respect of the Lease, the JOA, the TAA and this Agreement (provided that the withdrawing Parties shall remain responsible for their respective Cost
Bearing Participation share of any obligations undertaken or liabilities incurred under the JOA prior to such withdrawal), and Syntroleum and/or the Farmees, as applicable, shall reassign and re-convey their respective Participating Interest in the
Lease, the JOA, and the TAA to Syntroleum and/or its Farmees, as applicable, at no cost, or if Syntroleum and the Farmees elect to withdraw to YFP at no cost to YFP. 

  

	 	(vii)	If Syntroleum and the Farmees drill, test and plug and abandon (permanently or temporarily at the Parties’ election under the JOA) the Second Well, then Syntroleum and the
Farmees may at any time after the completion of the drilling of the Second Well and pursuant to the JOA make a Declaration of Commerciality and pay the Aje Commercial Bonus (nonetheless Commercial Production from the Lease shall not commence until a
Declaration of Commerciality has been properly made and the Aje Commercial Bonus paid); provided that: 

  

	 	(1)	 the Farmees shall have the right exercisable for one hundred eighty (180) days after the plugging and abandonment (permanently or temporarily) of the Second 

  

 13 

	 	 
Well to determine to terminate their participation in the Lease, the JOA, the TAA and this Agreement, and in the event they so determine, the Farmees shall
reassign and re-convey their respective Participating Interest in the Lease, the JOA, the TAA, and this Agreement to Syntroleum at no cost to Syntroleum and shall have no further rights, obligations and liabilities in respect of the Lease, the JOA,
the TAA, and this Agreement 

  

	 	(2)	Syntroleum shall have the right exercisable for twelve (12) months after the plugging and abandonment (permanently or temporarily) of the Second Well to determine to terminate its
participation in the Lease, the JOA, the TAA and this Agreement, and in the event Syntroleum so determines, Syntroleum shall reassign and re-convey its Participating Interest in the Lease, the JOA, the TAA and this Agreement to the Farmees in
proportion to their Participating Interests at no cost to Farmees, or if the Farmees have withdrawn to YFP at no cost to YFP (provided that Syntroleum shall remain responsible for its respective Cost Bearing Participation share of any obligations
undertaken or liabilities incurred under the JOA prior to such withdrawal). 

  

	 	D.	Unless a Declaration of Commerciality has been made: 

  

	 	(i)	within one hundred fifty (150) days after the plugging and abandonment (permanently or temporarily) of the Second Well, the Parties shall meet to discuss the results of the Second
Well, whether any Discovery warrants development and whether an Additional Well should be drilled, within one hundred eighty (180) days after the plugging and abandonment (permanently or temporarily) of the Second Well, Syntroleum and the Farmees
shall notify YFP whether Syntroleum and the Farmees have determined that the Lease is provisionally commercial and that Syntroleum and the Farmees intend to pay the Extension Bonus and to commence the drilling of a first Additional Well, and if so
Syntroleum and the Farmees shall commence drilling the first Additional Well within twelve (12) months after the plugging and abandonment (permanently or temporarily) of the Second Well. 

  

	 	(ii)	within one hundred fifty (150) days after the plugging and abandonment (permanently or temporarily) of the first Additional Well, the Parties shall meet to discuss the results of
the first Additional Well, whether any Discovery warrants development and whether an Additional Well should be drilled, within one hundred eighty (180) days after the plugging and abandonment (permanently or temporarily) of the first Additional
Well, Syntroleum and the Farmees shall notify YFP whether Syntroleum and the Farmees intend to commence the drilling of a second Additional Well, and if so Syntroleum and the Farmees shall commence drilling the second Additional Well within twelve
(12) months after the plugging and abandonment (permanently or temporarily) of the first Additional Well. 

  

	 	(iii)	within one hundred fifty (150) days after the plugging and abandonment (permanently or temporarily) of the second Additional Well, the Parties shall meet to discuss the results of
the second Additional Well, whether any Discovery warrants development and whether an Additional Well should be drilled, within one hundred eighty (180) days after the plugging and abandonment (permanently or temporarily) of the second Additional
Well, Syntroleum and the Farmees shall notify YFP whether Syntroleum and the Farmees intend to commence the drilling of a third Additional Well, and if so Syntroleum and the Farmees shall commence drilling the third Additional Well within twelve
(12) months after the plugging and abandonment (permanently or temporarily) of the second Additional Well. 

  

	 	(iv)	 within one hundred fifty (150) days after the plugging and abandonment (permanently or temporarily) of the third Additional Well, the Parties shall meet to discuss
the results of the 

  

 14 

	 	 
third Additional Well, whether any Discovery warrants development and whether an Additional Well should be drilled, within one hundred eighty (180) days
after the plugging and abandonment (permanently or temporarily) of the third Additional Well, Syntroleum and the Farmees shall notify YFP whether Syntroleum and the Farmees intend to commence the drilling of a fourth Additional Well, and if so
Syntroleum and the Farmees shall commence drilling the fourth Additional Well within twelve (12) months after the plugging and abandonment (permanently or temporarily) of the third Additional Well. 

  
 With respect to each Additional Well and any other well under the JOA, the
drilling and completion shall be bid on a turnkey basis, ADTI shall be invited to submit a turnkey bid, and unless the Operating Committee under the JOA decides otherwise such well shall be drilled under a turnkey drilling contract. The obligation
of Syntroleum and the Farmees to commence the drilling of an Additional Well may be extended by reasons of Force Majeure, Rig Unavailability or Governmental Delay. 
  

	 	(x)	Unless a Declaration of Commerciality has been made 

  

	 	(1)	If Syntroleum and the Farmees notify YFP that they do not intend to drill an Additional Well, then Syntroleum and the Farmees shall be deemed to have withdrawn from the Lease, the
JOA, the TAA and this Agreement pursuant to Article 13 of the JOA as of the last day of such time period, shall cease to have any rights or obligations or liabilities in respect of the Lease, the JOA, the TAA, and this Agreement (provided that the
Parties shall remain responsible for their respective Cost Bearing Participation share of any obligations undertaken or liabilities incurred under the JOA prior to such withdrawal), and Syntroleum and the Farmees shall reassign and re-convey their
respective Participating Interest in the Lease and the JOA to YFP at no cost to YFP. 

  

	 	(2)	If Syntroleum notifies the Farmees that Syntroleum does not intend to drill an Additional Well, then Syntroleum shall be deemed to have withdrawn from the Lease, the JOA, the TAA
and this Agreement pursuant to Article 13 of the JOA as of the last day of such time period, shall cease to have any rights or obligations or liabilities in respect of the Lease, the JOA, the TAA and this Agreement (provided that Syntroleum shall
remain responsible for its Cost Bearing Participation share of any obligations undertaken or liabilities incurred under the JOA prior to such withdrawal), and Syntroleum shall reassign and re-convey its Participating Interest in the Lease and the
JOA to the Farmees at no cost to the Farmees. 

  

	 	(3)	If the Farmees notify Syntroleum that they do not intend to drill an Additional Well or the Farmees fail to notify YFP and Syntroleum that the Farmees intend to drill such
Additional Well within one hundred eighty (180) days after the plugging and abandonment (permanently or temporarily) of the immediately preceding well, as such time period may be extended as provided in this Article 4.2(D), then the Farmees shall be
deemed to have withdrawn from the Lease, the JOA, the TAA and this Agreement pursuant to Article 13 of the JOA as of the last day of such time period, shall cease to have any rights or obligations or liabilities in respect of the Lease, the JOA, the
TAA and this Agreement (provided that the withdrawing Parties shall remain responsible for their respective Cost Bearing Participation share of any obligations undertaken or liabilities incurred under the JOA prior to such withdrawal), and the
Farmees shall reassign and re-convey their respective Participating Interest in the Lease, the JOA, the TAA and this Agreement to Syntroleum in proportion to their Participating Interests at no cost to Syntroleum. 

  

 15 

	 	(4)	If Syntroleum and/or the Farmees fail to commence the drilling of an Additional Well within twelve (12) months after the plugging and abandonment (permanently or temporarily) of the
immediately preceding well, as such time period may be extended as provided in this Article 4.2(D), then Syntroleum and/or the Farmees shall be deemed to have withdrawn from the Lease, the JOA, the TAA and this Agreement pursuant to Article 13 of
the JOA as of the last day of such time period, shall cease to have any rights or obligations or liabilities in respect of the Lease, the JOA, the TAA and this Agreement (provided that the withdrawing Parties shall remain responsible for their
respective Cost Bearing Participation share of any obligations undertaken or liabilities incurred under the JOA prior to such withdrawal), and Syntroleum and/or the Farmees, as applicable, shall reassign and re-convey their respective Participating
Interest in the Lease, the JOA, the TAA and this Agreement to YFP at no cost to YFP. 

  

	 	(y)	If Syntroleum and the Farmees drill, test and properly plug and abandon (permanently or temporarily at the Parties’ election under the JOA) an Additional Well, then Syntroleum
and the Farmees may at any time after the completion of the drilling of such Additional Well and pursuant to the JOA make a Declaration of Commerciality and pay the Aje Commercial Bonus (nonetheless Commercial Production from the Lease shall not
commence until a Declaration of Commerciality has been properly made and the Aje Commercial Bonus paid); provided that: 

  

	 	(1)	the Farmees shall have the right exercisable for one hundred eighty (180) days after the plugging and abandonment (permanently or temporarily) of such Additional Well to determine
to terminate their respective participation in the Lease, the JOA, the TAA and this Agreement, and in the event they so determine, the Farmees shall reassign and re-convey their respective Participating Interest in the Lease, the JOA, the TAA and
this Agreement to Syntroleum at no cost to Syntroleum, and shall have no further rights, obligations and liabilities in respect of the Lease, the JOA, the TAA and this Agreement (provided that the withdrawing Parties shall remain responsible for
their respective Cost Bearing Participation share of any obligations undertaken or liabilities incurred under the JOA prior to such withdrawal). 

  

	 	(2)	Syntroleum shall have the right exercisable for twelve (12) months after the plugging and abandonment (permanently or temporarily) of such Additional Well to determine to terminate
its participation in the Lease, the JOA, the TAA and this Agreement, and in the event Syntroleum so determines, Syntroleum shall reassign and re-convey its Participating Interest in the Lease, the JOA, the TAA, and this Agreement to the Farmees in
proportion to their Participating Interests at no cost to Farmees, or if the Farmees have withdrawn to YFP at no cost to YFP (provided that Syntroleum shall remain responsible for its respective Cost Bearing Participation share of any obligations
undertaken or liabilities incurred under the JOA prior to such withdrawal). 

  

	 	E.	 With respect to the decisions of Farmees and Syntroleum under Article 4.2(B), Article 4.2(C) and Article 4.2(D) whether to give notice to drill another well, if one
or more (but less than all) Farmees are willing to commit to drill such well, then the Farmees and/or Syntroleum willing to commit to drill such well shall have the option exercisable within the time period set out in Article 4.2B, Article 4.2(C)
and Article 4.2(D) by notice to YFP to commit to drill such well and assume the rights, obligations and liabilities of all unwilling Farmees under this Agreement, the JOA and the TAA in such proportion as the willing Farmees may agree and the
Farmees not willing to accept such 

  

 16 

	 	 
proposed revisions or conditions shall be deemed to have withdrawn from this Agreement, the Deed of Assignment, the JOA and the TAA in the manner
contemplated by Article 13 of the JOA. 

  

	4.3	Deemed Completion 

  
 With respect to each well in Article 4.2 if the Farmees and Syntroleum fulfill the obligations set out below and bear their Cost Bearing Participation
shares of all costs related to such well, including the YFP Carried Participation, then Syntroleum and the Farmees shall have fulfilled such well obligation: 
  

	 	A.	If a well does not reach the objective depth because the Technical Advisor encounters impenetrable substances, basement, commercial quantities of oil or gas at a lesser depth, or
are forced to abandon a well because of difficulties insurmountable by employing modern drilling technology in conformity with sound, cost effective practices generally accepted in the international petroleum industry, then:

  

	 	(i)	If the cumulative amount spent by the Farmees and Syntroleum related to such well (which for the avoidance of doubt shall include all amounts spent by the contractor under the
turnkey drilling contract) is at least US$21,000,000 the Farmees and Syntroleum shall nonetheless be deemed to have satisfied the Work Commitments with respect to such well. 

  

	 	(ii)	If the cumulative amount spent by the Farmees and Syntroleum related to such well (which for the avoidance of doubt shall include all amounts spent by the contractor under the
turnkey drilling contract) is less than US$21,000,000 the Farmees and Syntroleum shall have the right to drill one or more substitute wells at locations and to objective depths determined by the Farmees and Syntroleum consistent with the applicable
restrictions of Article 4.2. 

  

	 	B.	If such well, or substitute well, is drilled to the objective depth, then the Farmees and Syntroleum shall endeavor to evaluate the well in accordance with practices generally
accepted in the international petroleum industry; provided that if downhole conditions or mechanical difficulties are encountered which would, in the opinion of a prudent operator, render any such log or survey impracticable, then the Farmees and
Syntroleum shall have the right to curtail or omit all or part of such operations. 

  

	 	C.	If Hydrocarbons are encountered in the drilling of such well, or substitute well, the Farmees and Syntroleum shall endeavor to carry out a testing program agreed to by the Parties
pursuant to the terms of the JOA in accordance with generally accepted practices of the international petroleum industry; provided that if downhole conditions or mechanical difficulties are encountered which would, in the opinion of a prudent
operator, render any testing impracticable, then the Farmees and Syntroleum shall have the right to curtail or omit all or part of any such operations. 

  

	 	D.	On fulfillment of the drilling operations, and the evaluation and testing programs, if any, the Farmees and Syntroleum shall in accordance with generally accepted practices of the
international petroleum industry plug and abandon such well or substitute well, or if appropriate, suspend such well at the election of the Parties pursuant to the terms of the JOA. 

  

	4.4	Right to Audit 

  
 Each Party shall have the right to audit all costs and payments made under terms and conditions of this Agreement in accordance with Section 1.8 of the
Accounting Procedure attached to the JOA. 
  

	4.5	Transfer Fees 

  
 Any costs, expenses, fees, or duties payable to the Government in connection with the Deed of Assignment, the JOA or the TAA, excluding taxes described in
Article 9, shall be borne and paid by the Parties in proportion to their respective Profit Sharing Interests. 
  

 17 

	4.6	Indemnification 

  

	 	A.	YFP shall indemnify and hold harmless Syntroleum and the Farmees from and against any and all expenses, damages, claims, losses and liabilities of whatsoever nature or kind
(including expenditures for legal fees on a solicitor and his own client basis) which are made or brought by any person or entity against Syntroleum and the Farmees or are otherwise suffered or incurred by Syntroleum and the Farmees as a result of,
in connection with, or arising directly or indirectly from any act, omission, matter or thing done or omitted to be done which arose, accrued, occurred or was incurred relating to the Lease prior to the Approval Date including any liability arising
at any time to any third party arising out of or in connection with the abandonment of decommissioning of or otherwise in connection with the wells on the Lease identified as the Aje #1 Well and the Aje #2 Well, except that this indemnification
shall have no effect if the Aje #1 Well and the Aje #2 Well are used in Joint Operations as such term is defined in the JOA. 

  

	 	B.	YFP shall indemnify and hold harmless Syntroleum and the Farmees from and against any and all expenses, damages, claims, losses and liabilities of whatsoever nature or kind
(including expenditures for legal fees on a solicitor and his own client basis) which are made or brought by any person or entity against Syntroleum and the Farmees or are otherwise suffered or incurred by Syntroleum and the Farmees as a result of,
in connection with, or arising directly or indirectly from any breach by YFP of its representations, warranties or obligations under this Agreement. 

  

	 	C.	Syntroleum shall indemnify and hold harmless YFP and the Farmees from and against any and all expenses, damages, claims, losses and liabilities of whatsoever nature or kind
(including expenditures for legal fees on a solicitor and his own client basis) which are made or brought by any person or entity against YFP and the Farmees or are otherwise suffered or incurred by YFP and the Farmees as a result of, in connection
with, or arising directly or indirectly from any breach by Syntroleum of its representations, warranties or obligations under this Agreement. 

  

	 	D.	The Farmees shall indemnify and hold harmless YFP and Syntroleum from and against any and all expenses, damages, claims, losses and liabilities of whatsoever nature or kind
(including expenditures for legal fees on a solicitor and his own client basis) which are made or brought by any person or entity against YFP and Syntroleum or are otherwise suffered or incurred by YFP and Syntroleum as a result of, in connection
with, or arising directly or indirectly from any breach by the Farmees of their representations, warranties or obligations under this Agreement. 

  

ARTICLE 5 
 OBLIGATIONS UNDER
CONTRACT 
  

	5.1	Acceptance of Terms 

  
 Subject to satisfaction or waiver of the Conditions Precedent, each of the Parties hereby ratifies, confirms and accepts the terms of the Lease and the
JOA. 
  
 ARTICLE 6 
 UNDERTAKING OF THE PARTIES 
  

	6.1	YFP Obligations 

  

	 	A.	At all times during this Agreement YFP shall comply with the following: 

  

	 	(i)	wherever possible, make all reasonable efforts to secure the minimum permissible royalty rates, as are applicable from time to time, to be applied to all production of Hydrocarbons
from the Lease Area; 

  

 18 

	 	(ii)	provide promptly to the Parties any written notice of default or termination received by YFP with respect to the Lease or of any action to alter, terminate, or rescind or procure a
judicial reformation of the Lease; 

  

	 	(iii)	provide promptly to the Parties any written notice of any pending or threatened claim, demand, action, suit, inquiry or proceeding related to the Lease; 

  

	 	(iv)	provide promptly to the Parties all material correspondence including with the Government and the Federal Inland Revenue Services of Nigeria; 

  

	 	(v)	not conduct its business with respect to the Lease outside the ordinary course consistent with recent past practices; 

  

	 	(vi)	use reasonable efforts to do or cause to be done all such lawful acts within its control to ensure that the Lease remains in full force and effect; or 

  

	 	(vii)	abstain from any act which may jeopardize or result in the termination of the Lease. 

  

	 	B.	During the Interim Period, YFP shall comply with the following: 

  

	 	(i)	YFP shall promptly notify Syntroleum and the Farmees and provide all relevant details on the occurrence of: 

  

	 	(1)	any material damage, destruction or loss to assets under the Lease; 

  

	 	(2)	any event or condition that: 

  

	 	(a)	would have a material adverse effect on the business, operations, financial condition or results of operations under the Lease; or 

  

	 	(b)	would render impossible the approval of the Deed of Assignment, or the substantial satisfaction of the other Conditions Precedent. 

  

	 	(ii)	Except as otherwise agreed by the Parties, YFP covenants and undertakes to: 

  

	 	(1)	pay when due any costs and expenses, or timely perform any material obligations of YFP under the Lease; 

  

	 	(2)	pay any amount due under any material contract on or before the date due, or otherwise fail to comply with any such contract; 

  

	 	(3)	not terminate, materially amend, or extend any material contracts affecting the Lease; 

  

	 	(4)	not participate in the drilling of a new well or make or enter into any other commitments reasonably anticipated to require future capital expenditures with respect to the Lease;

  

	 	(5)	not enter into or commit to enter into any new contract that is material to the use, ownership or operation of the Lease; 

  

	 	(6)	not settle, compromise or waive any material right relating to the Lease; 

  

	 	(7)	use reasonable efforts to do or cause to be done all such lawful acts within its control to not allow any permits pertaining to the Lease to be released or to lapse;

  

	 	(8)	not transfer, sell, hypothecate, encumber, or otherwise dispose of the Lease or any assets related to the Lease; 

  

	 	(9)	not grant or create any preferential right to purchase, right of first opportunity or other transfer restriction or requirement with respect to the Lease; and

  

 19 

	 	(10)	not agree to extend any statute of limitations with respect to Taxes or any extension of time with respect to a Tax assessment or deficiency, or make any change in any Tax elections
with respect to the Assets. 

  

	6.2	Mutual Obligations 

  
 During the Interim Period the Farmees and YFP and Syntroleum shall comply with each of the following undertakings: 
  

	 	A.	Each Party, as applicable, agrees to use commercially reasonable efforts to satisfy, in an expeditious manner, the Conditions Precedent. 

  

	 	B.	The Parties shall not take any action nor fail to take any action prior to the Approval Date that would result in a breach of any of its representations and warranties under this
Agreement. 

  
 ARTICLE 7 
 REPRESENTATIONS AND WARRANTIES OF THE PARTIES 
  

	7.1	YFP and Syntroleum Representations and Warranties 

  
 Except as otherwise disclosed in the Attachments to this Agreement, YFP and Syntroleum make the following representations and warranties to Farmees as of
the date of signing this Agreement and as of the Approval Date: 
  

	 	A.	YFP represents and warrants to Farmees that: 

  

	 	(i)	The Lease (a true and complete copy of which has been provided to Syntroleum and the Farmees) is in full force and effect, in good standing, and YFP is the holder of a one hundred
percent (100%) legal and beneficial working interest therein, free and clear of all overriding royalty interests, carried interests, net profit interests, mortgages, charges, pledges, liens, options, pre-emptive rights and other claims or
encumbrances other than royalties or other entitlements of the Government pursuant to the laws and regulations of the Federal Republic of Nigeria. 

  

	 	(ii)	YFP is and throughout the term of this Agreement shall be (i) a qualified indigenous Nigerian company, (ii) an Operator as contemplated under the JOA in good standing with the
Government, (iii) entitled to receive from the Government the benefits accorded qualified indigenous Nigerian companies, and (iv) qualified to own and hold its interests in the Lease as an indigenous Nigerian company. 

  

	 	(iii)	No act or omission of YFP nor, to the best of YFP’s knowledge, information and belief, any act or omission of any other prior party to the Lease has occurred which would or
might entitle the Government to terminate the Lease and no notice has been given to YFP or, to the best of YFP’s knowledge, information and belief, to any other party to the Lease by the Government of any intention to terminate the Lease.

  

	 	(iv)	With respect to the Lease and YFP’s entitlement to an interest therein there are no unsatisfied judgments or arbitral awards, claims, law suits or proceedings in existence,
contemplated or threatened, and no circumstance exists which YFP reasonably believes may give rise to such a claim, law suit or proceeding. 

  

	 	(v)	YFP is the Operator of the Lease and all operations on the Lease have been performed in compliance with the terms and conditions of the Lease and the Laws/Regulations of the Federal
Republic of Nigeria. 

  

 20 

	 	(vi)	All work programs and financial commitments (whether to the Government, service contractors or otherwise) in respect of the Lease in effect on the Effective Date have been fully
disclosed in writing to Syntroleum and the Farmees. Other than any work or other obligations which by the terms of such work programs or financial commitments are to be performed or satisfied after the date of this Agreement, there are no
outstanding work or other obligations required to be performed or satisfied in respect of the Lease. 

  

	 	(vii)	All royalties, bonuses, taxes, license fees and other amounts payable by YFP under the terms and conditions of the Lease or the Laws/Regulations of the Federal Republic of Nigeria
in respect of the Lease have been properly paid in a timely manner or will be so paid when due. 

  

	 	(viii)	The accounts, books and records kept by YFP in respect of the Lease are true, correct and complete in all material respects and have been kept in a manner consistent with YFP’s
past practices and in compliance with the terms and conditions of the Lease and the Laws/Regulations of the Federal Republic of Nigeria. 

  

	 	(ix)	YFP has provided Syntroleum and the Farmees with true, complete and correct copies of all records pertaining to the Lease. For these purposes “records” means all contract
files, seismic, geological, geophysical and engineering data, and all other books, records, data, files, maps, and accounting records (in whatever form and language) that relate to or arise out of the Lease, the assets relating to the Lease, or any
operations related to any of the assets. 

  

	 	(x)	There are no other terms and conditions applicable to the Lease other than those set out in the copy of the Lease given to the other Parties by YFP other than set forth in the
general law; 

  

	 	(xi)	YFP, subject only to the consent of the Government, has the unencumbered right to sell, transfer and assign the Participating Interest to each of the Parties as set out in Article
2.1. 

  

	 	(xii)	No orders, notices or directives have been issued by the Government and no claims have been threatened or made by the Government or any other person or entity in respect of
environmental matters (including, without limitation, allegations of environmental contamination, non-compliance with abandonment and reclamation obligations or non-compliance with any applicable laws or regulations pertaining to health, safety and
the environment) in connection with the Lease and there are no circumstances existing as at the Effective Date which YFP reasonably believes may result in any such orders, notices, directives or claims being issued or made. 

 

	 	(xiii)	Neither YFP nor any of its Affiliates nor any of its or their directors, officers, employees, consultants or agents (individually a “YFP Party”) have made and will not
make at any time during the term of this Agreement with respect to the matters provided for hereunder any payments, loans, gifts or promises of payments, loans or gifts, directly or indirectly, to or for the use or benefit of any official or
employee of the Government or to or for the use of any political party, official or candidate or to any other person if such YFP Party knows or knew or should have known or has or had reason to suspect that any part of such payment, loan or gift or
promise or offer, would violate the laws or regulations of the Federal Republic of Nigeria or other laws and regulations applicable to any of the Parties or their respective Affiliates. Each Party shall respond promptly, and in reasonable detail, to
any notice from any other Party or its auditors pertaining to the above stated representation and warranty and shall furnish documentary support for such response upon request from such other Party. 

  

 21 

	 	(xiv)	Prior to the execution of this Agreement the only agreements in effect relating to the Lease are the JVA, and the Heads of Agreement, and no other arrangement or commitment relating
to the Lease is in effect. 

  

	 	(xv)	YFP has provided access to all technical data (including traded data) relating to the Lease in its possession to Syntroleum and/or the Farmees. 

  

	 	B.	Syntroleum represents and warrants to Farmees and YFP that Syntroleum or its Affiliates own one hundred percent of the Syntroleum GTL Process and the Syntroleum GTL Process will
produce GTL diesel and naphtha. 

  

	7.2	Farmees’ Representations and Warranties 

  
 Except as otherwise disclosed in the attached schedules, Farmees make the following representations and warranties to YFP and Syntroleum as of the date of
signing this Agreement and the Approval Date: 
  

	 	A.	Farmees have sufficient cash, available lines of credit or other sources of immediately available funds to enable them to fulfill all of their obligations under this Agreement.

  

	 	B.	Farmees have the technical capability, personnel and resources to fulfill their obligations under this Agreement. 

  

	7.3	Mutual Representations and Warranties 

  
 The Parties make the following representations and warranties to each other as of the date of signing this Agreement and the Approval Date: 
  

	 	A.	Corporate Authority. 

  

	 	(i)	Each Party is duly organized and validly existing under the laws of the country where it is organized. To the extent required, each Party is qualified to conduct business in each
jurisdiction where it is necessary to be qualified to perform the Lease. 

  

	 	(ii)	Each Party has all requisite corporate power and authority to enter into this Agreement, to perform its obligations hereunder, and to consummate the transactions contemplated
hereby. 

  

	 	B.	Enforceable Obligation. This Agreement has been duly executed and delivered by each Party and constitutes a legal, valid and binding obligation of each Party, enforceable against
each Party in accordance with its terms. 

  

	 	C.	No Conflicts. The execution, delivery, and performance of this Agreement by each Party, the consummation of the transactions contemplated by this Agreement, and the compliance with
the provisions of this Agreement will not, to the best of each Party’s knowledge and belief: 

  

	 	(i)	Result in a material default with due notice or lapse of time or both, or the creation of any lien or encumbrance or give rise to any right of termination, cancellation, or
acceleration under any material note, bond, mortgage, indenture, license, or agreement to which such Party is a party or by which it or the Lease are bound; 

  

	 	(ii)	Violate any provision of the certificate of incorporation, memorandum and articles of association, bylaws or other formation and governing documents of such Party;

  

	 	(iii)	Violate any laws applicable to such Party or the Lease; or 

  

	 	(iv)	Violate any judgment, order, ruling, or decree applicable to such Party or the Lease. 

  

	 	D.	 Payments. No Party nor any of its Affiliates has made, offered, or authorized and will not make, offer or authorize any payment, gift, promise or other advantage,
in connection with the matters, which are the subject to this Agreement, whether directly or indirectly through any other person or 

  

 22 

	 	 
entity, to or for the use or benefit of any public official (which for these purposes means any person holding a legislative, administrative or judicial
office, including any person employed by or acting on behalf of a public agency, a public enterprise or a public international organization) or any political party or political party official or candidate for office, where such payment, gift or
promise would violate: 

  

	 	(i)	the applicable Laws of the country of operations; 

  

	 	(ii)	the laws of the country of formation of the Party or such Party’s ultimate parent company, or its principal place of business; or 

  

	 	(iii)	the principles described in the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, signed in Paris on December 17, 1997, which
entered into force on February 15, 1999, and the Convention’s Commentaries. 

  

	 	E.	Representation by Counsel. Each of the Parties represents and warrants that it has been represented by legal counsel in the preparation, review and/or negotiation of this Agreement,
the Deed of Assignment, the Parent Company Guarantee, the JOA, the TAA, and the AMI Agreement. 

  

	 	F.	Validity of Representations. All representations and warranties given under this Article 7 shall be deemed repeated and valid, true and correct as of the date of signing of this
Agreement and the Approval Date, and shall remain valid and enforceable until the earlier of two (2) years after the Effective Date or one (1) year after the Approval Date. Each Party agrees to inform the other Party of any material changes to the
facts in the representations and warranties prior to the Approval Date. 

  

	 	G.	Indemnity. Each of the Parties agrees to indemnify and hold the other Parties harmless from any claims, causes of action, or liabilities, which arise out of the breach of any of the
warranties and representations under this Article by the indemnifying Party. 

  

	7.4	Disclaimer of Other Representations and Warranties 

  
 Except for the representations and warranties provided in this Article, YFP, Syntroleum and Farmees make no, and disclaim any, warranty or representation
of any kind, either express, implied, statutory, or otherwise, including, without limitation, the accuracy or completeness of any data, reports, records, projections, information, or materials now, heretofore, or hereafter furnished or made
available to Farmees in connection with this Agreement. 
  
 ARTICLE 8 
 AREA OF MUTUAL INTEREST 
  
 The Parties and YFP have concurrently entered into the AMI Agreement establishing an Area of Mutual Interest covering offshore Benin Blocks
1, 2, 3, and 4, including the Seme Field, and offshore Nigeria Blocks OPL 310, 311, 312, 313 and 314. 
  
 ARTICLE 9 
 TAX 
  

	9.1	Tax Obligations 

  
 The Operator and the Technical Advisor together with the Tax Sub-Committee under the JOA shall consult with competent experts to determine the most
equitable and efficient means of making payment for PPTA and CITA in accordance with applicable law, however, unless the Parties otherwise agree the Tax treatment shall be as follows: Save for the payment by the Technical Advisor of PPTA and CITA,
each Party shall be 

  

 23 

 
responsible for reporting and discharging its own tax measured by the profit or income of the Party and the satisfaction of such Party’s share of all
obligations under the Lease and under this Agreement, the JOA and the TAA. Each Party shall protect, defend and indemnify each other Party from any and all loss, cost or liability arising from the indemnifying Party’s failure to report and
discharge such taxes or satisfy such obligations. The Parties intend that all income and all tax benefits (including, but not limited to, deductions, depreciation, credits and capitalization) with respect to the Capital Expenditures and Operating
Expenditures made by and Prior Costs transferred to the Parties will be allocated by the Government tax authorities to the Parties based on the share of each tax item actually received, borne or owned by each Party. If such allocation is not
accomplished due to the application of the laws and regulations of the Government or other Government action, the Party or Parties whose net tax liabilities have been reduced as a result of tax items not being allocated in the manner provided for in
this paragraph shall, in proportion to and solely to the extent of the net reduction in their taxes, protect, defend and indemnify each Party whose net tax liability has been increased as a result of tax items not being allocated in the manner
provided for in this paragraph against the total amount of such Party’s increased net tax liability including any taxes assessed on the amount of any such indemnity payment. The amount of any income or reduction in a Party’s net tax
liabilities shall be calculated on a separate-company basis with regard to only the tax items relating to this Agreement, the JOA and the TAA. Any indemnity payment under this Article shall be made within thirty (30) Days after the date notice is
given by the indemnified Party to the indemnifying Party or Parties, which notice provides reasonable details regarding the amount of the increase in the indemnified Party’s net tax liability. Technical Advisor shall provide each Party, in a
timely manner and at such Party’s sole expense, with such information with respect to Joint Operations as such Party may reasonably request for preparation of its (or its Affiliate’s) tax returns or responding to any audit or other tax
proceeding. 
  

	9.2	Joint Levy 

  
 If interpretation or enforcement of the Lease by the Government imposes joint and several liability on the Parties for any levy, charge or tax, the
Parties agree to cross indemnify each other to the extent that such levy, charge or tax is owed by one Party individually. 
  

	9.3	United States Tax Election 

  

	 	A.	If, for United States federal income tax purposes, this Agreement and the operations under this Agreement are regarded as a partnership and if the Parties have not agreed to form a
tax partnership, each Party elects to be excluded from the application of all of the provisions of Subchapter “K”, Chapter 1, Subtitle “A” of the United States Internal Revenue Code of 1986, as amended (the “Code”), to
the extent permitted and authorized by Section 761(a) of the Code and the regulations promulgated under the Code. The Party holding the greatest Participating Interest whose ultimate parent company is a U.S. party is authorized and directed to
execute and file for each Party such evidence of this election as may be required by the Internal Revenue Service, including all of the returns, statements, and data required by United States Treasury Regulations Sections 1.761-2 and
1.6031(a)-1(b)(5) and shall provide a copy thereof to each Party whose parent company is a U.S. party. Should there be any requirement that any Party give further evidence of this election, each Party shall execute such documents and furnish such
other evidence as may be required by the Internal Revenue Service or as may be necessary to evidence this election. 

  

	 	B.	 No Party shall give any notice or take any other action inconsistent with the foregoing election. If any income tax laws of any state or other political subdivision
of the United States or any future income tax laws of the United States or any such political subdivision contain provisions similar to those in Subchapter “K”, Chapter 1, Subtitle “A” of the Code, under which an election similar
to that provided by Section 761(a) of the Code is permitted, each Party shall make such election as may be permitted or required by such laws. In making the foregoing election or elections, each U.S. 

  

 24 

	 	 
Party states that the income derived by it from operations under this Agreement can be adequately determined without the computation of partnership taxable
income. 

  

	 	C.	Unless approved by every Non-U.S. Party, no activity shall be conducted under this Agreement that would cause any Non-U.S. Party to be deemed to be engaged in a trade or business
within the United States under United States income tax laws and regulations. 

  
 ARTICLE 10 
 CONFIDENTIALITY 
  

	10.1	Confidential Information 

  
 Except as otherwise provided in the Lease and the JOA, each Party agrees that all information disclosed under this Agreement, except information in the
public domain or lawfully in possession of a Party prior to the Effective Date, shall be considered confidential and shall not be disclosed to any other person or entity without the prior written consent of the Party which owns such confidential
information. This obligation of confidentiality shall remain in force during the term of the Lease and for a period of two (2) years thereafter. Notwithstanding the foregoing, confidential information may be disclosed without consent and without
violating the obligations contained in this Article in the following circumstances: 
  

	 	A.	to an Affiliate provided the Affiliate is bound to the provisions of this Article 10 and the Party disclosing is responsible for the violation of an Affiliate;

  

	 	B.	to a governmental agency or other entity when required by the Lease; 

  

	 	C.	to the extent such information is required to be furnished in compliance with the applicable Laws/Regulations, or pursuant to any legal proceedings or because of any order of any
court binding upon a Party; 

  

	 	D.	to attorneys engaged, or proposed to be engaged, by any Party where disclosure of such information is essential to such attorneys’ work for such Party and such attorneys are
bound by an obligation of confidentiality; 

  

	 	E.	to contractors and consultants engaged, or proposed to be engaged, by any Party where disclosure of such information is essential to such contractor’s or consultant’s work
for such Party; 

  

	 	F.	to a bona fide prospective transferee of a Party’s Participating Interest, or portion thereof, to the extent appropriate in order to allow the assessment of such Participating
Interest (including an entity with whom a Party and/or its Affiliates are conducting bona fide negotiations directed toward a merger, consolidation or the sale of a majority of its or an Affiliate’s shares); 

  

	 	G.	to a bank or other financial institution to the extent appropriate to a Party arranging for funding; 

  

	 	H.	to the extent such information must be disclosed pursuant to any rules or requirements of any government or stock exchange having jurisdiction over such Party, or its Affiliates;

  

	 	I.	to its respective directors, officers and employees, subject to each Party taking sufficient precautions to ensure such information is kept confidential; and

  

	 	J.	to the extent any information which, through no fault of a Party, becomes a part of the public domain. 

  

	10.2	No Disclosure 

  
 Disclosure pursuant to Articles 10.1 (E), (F), (G) to the other parties to the Lease and JOA and the Government shall not be made unless prior to such
disclosure the disclosing Party has obtained a written undertaking from the recipient party to keep the information strictly confidential for at least as long as the 

  

 25 

 
period set out above and to use the information for the sole purpose described in Articles 10.1 (E), (F), (G), whichever is applicable, with respect to the
disclosing Party. 
  
 ARTICLE 11 
 NOTICES 
  
 All notices authorized or required between the Parties by any of the provisions of this Agreement shall be in writing in English and delivered in person or by courier
service or by any electronic means of transmitting written communications which provides written confirmation of complete transmission, and properly addressed to the other Party. Verbal communication does not constitute notice for purposes of this
Agreement, and e-mail addresses and telephone numbers for the Parties are listed below as a matter of convenience only. A notice given under any provision of this Agreement shall be delivered when actually received by the Party to whom such notice
is directed, and the time for such Party to deliver any notice in response to such originating notice shall run from the date the originating notice is received. “Received” for purposes of this Article shall mean actual
delivery of the notice to the address of the Party specified below. A Party may change its address by written notice to the other Parties. 
  

			
	 Yinka Folawiyo Petroleum Company Limited
 Yinka Folawiyo
Plaza
 38 Warehouse Road
 Apapa, Lagos, Nigeria
 Attention: Managing Director
 Telephone: 2341 545 0222
 Facsimile: 2341 587 0068
	  	 
		
	 Syntroleum Nigeria Limited
 St. Nicholas House,
9th Floor
 Catholic
Mission Street
 Lagos, Nigeria
 Attention: President

Telephone: 2341 461 3144
 Facsimile: 2341 264 7374
	  	 With a copy to:
 Syntroleum International Holdings
Co.
 4322 South 49th
West Ave
 Tulsa, Oklahoma 74107 USA
 Attention:
President
 Telephone: 1 918 592 7900
 Facsimile: 1 918 592
7979

		
	 Lundin Petroleum B.V.
 Amaliastraat 3-5
 2514 JC
 The Hague, The Netherlands
 Attn: Managing Director
 Telephone: 31 70 37 17 818
 Facsimile: 31 70 38 19 354
	  	 With a copy to:
 Lundin Petroleum AB
 6, rue de Rive
 Geneva, Switzerland 1204
 Attn: Chief Operating Officer
 Telephone: 41 22 817 1200
 Facsimile: 41 22 817 1201

		
	 Palace Exploration Company
 1202 East 33rd St, Suite 100
 Tulsa, OK
74105-2048 USA
 Attn: Vice President
 Telephone: 1 918 743
5096
 Facsimile: 1 918 743 5159
	  	 With a copy to:
 Palace Exploration Company

5 East 59th St., 5th Floor
 New York, NY 10022
USA
 Attn: President
 Telephone: 1 212 935 4110
 Facsimile: 1 212 593 1287

		
	 Challenger Minerals (Nigeria) Limited
 c/o Challenger
Minerals Inc.
 15375 Memorial Dr.
 Houston, TX 77079
USA
 Attn: International Negotiator
 Telephone: 1 281 925
7200
 Facsimile: 1 281 925 7280
	  	 With a copy to:
 GlobalSantaFe Corporation

15375 Memorial Dr.
 Houston, TX 77079 USA
 Attn: General Counsel
 Telephone: 1 281 925 6000
 Facsimile: 1 281 925 6010

  

 26 

			
	 Providence Resources p.l.c.
 60 Merrion Road

Ballsbridge, Dublin 4, Ireland
 Attn: Manager of Operations
 Telephone: 353 1667 5740
 Facsimile: 353 1667 5743
	  	 
		
	 Howard Energy Co., Inc.
 13561 W. Bay Shore
Dr.
 Traverse City, MI 49684 USA
 Attn: General
Manager
 Telephone: 1 231 995 7850
 Facsimile: 1 231 941
0025
	  	 

  
 ARTICLE 12

 LAW AND DISPUTE RESOLUTION 
  

	12.1	Governing Law 

  
 The law of England, exclusive of any conflicts of laws principles that could require the application of any other law, shall govern this Agreement for all
purposes, including the resolution of disputes between or among the Parties. 
  

	12.2	Dispute Resolution 

  
 Any and all claims, demands, causes of action, disputes, controversies and other matters in question arising out of or relating to this Agreement,
including any question regarding its breach, existence, validity or termination, which the Parties do not resolve amicably within a period of thirty (30) days, shall be resolved by arbitration in accordance with the provisions of Article 18.2 of the
JOA, as though such provisions were a part of this Agreement. 
  
 ARTICLE 13 
 FORCE MAJEURE 
  

	13.1	Right to Suspend Obligations 

  
 If as a result of Force Majeure, any Party is rendered unable, wholly or in part, to carry out its obligations under this Agreement, other than the
obligation to pay any amounts due, then the obligations of the Party giving such notice, so far as and to the extent that the obligations are affected by such Force Majeure, shall be suspended during the continuance of any inability so caused and
for such reasonable period thereafter as may be necessary for the Party to put itself in the same position that it occupied prior to the Force Majeure, but for no longer period. The Party claiming Force Majeure shall notify the other Parties of the
Force Majeure within a reasonable time after the occurrence of the facts relied on and shall keep all Parties informed of all significant developments. Such notice shall give reasonably full particulars of the Force Majeure and also estimate the
period of time which the Party will probably require to remedy the Force Majeure. The affected Party shall use all reasonable diligence to remove or overcome the Force Majeure situation as quickly as possible in a commercially reasonable manner but
shall not be obligated to settle any labor dispute except on terms acceptable to it. All such disputes shall be handled within the sole discretion of the affected Party. 
  

 27 

	13.2	Definition 

  

	 	A.	For the purposes of this Agreement, “Force Majeure” shall mean circumstances which were beyond the reasonable control of the Party affected. 

  

	 	B.	Subject to Article 13.2(C), Force Majeure shall include, without limitation, the following events and circumstances: 

  

	 	(i)	acts of war (whether declared or undeclared), armed conflict, civil unrest or insurrection, blockade, embargo, riot, sabotage, acts of terrorism or the specific threats of such acts
or events, or conditions attributable to such acts or events; 

  

	 	(ii)	strike, work slow down, lockout or other industrial disturbance or labor dispute; 

  

	 	(iii)	epidemics or plague; 

  

	 	(iv)	fire, earthquake, cyclone, hurricane, flood, drought, lightning, storms, storm warnings, navigational and maritime perils, or other acts of God; 

  

	 	(v)	Governmental Delay; and 

  

	 	(vi)	Rig Unavailability. 

  

	 	C.	The following events and circumstances shall not constitute Force Majeure: 

  

	 	(i)	changes in market conditions; or 

  

	 	(ii)	financial hardship or the inability of a Party to make a profit or receive a satisfactory rate of return from its operations. 

  
 ARTICLE 14 
 GENERAL PROVISIONS 
  

	14.1	Relationship of Parties 

  
 The rights, duties, obligations and liabilities of the Parties under this Agreement shall be individual, not joint, several or collective. It is not the
intention of the Parties to create, nor shall this Agreement be deemed or construed to create, a mining or other partnership, joint venture or association or (except as explicitly provided in this Agreement) a trust. This Agreement shall not be
deemed or construed to authorize any Party to act as an agent, servant or employee for any other Party for any purpose whatsoever except as explicitly set forth in this Agreement. In their relations with each other under this Agreement, the Parties
shall not be considered fiduciaries except as expressly provided in this Agreement. 
  

	14.2	Assignment 

  
 Any transfer of all or part of a Party’s Participating Interest, Cost Bearing Participation and Revenue Participation shall be effective only if it
satisfies the terms and conditions of Article 12 of the JOA. 
  

	14.3	Further Assurances 

  
 Each of the Parties shall do all such acts and execute and deliver all such documents as shall be reasonably required in order to fully perform and carry
out the terms of this Agreement. 
  

	14.4	Waiver 

  
 No waiver by any Party of any one or more defaults by another Party in the performance of any provision of this Agreement shall operate or be construed as
a waiver of any future default or defaults by the same Party whether of a like or of a different character. Except as expressly provided in this Agreement, no Party shall 

  

 28 

 
be deemed to have waived, released or modified any of its rights under this Agreement unless such Party has expressly stated, in writing, that it does waive,
release or modify such rights. 
  

	14.5	Joint Preparation 

  
 Each provision of this Agreement shall be construed as though all Parties participated equally in the drafting of the same. Consequently, the Parties
acknowledge and agree that any rule of construction that a document is to be construed against the drafting party shall not be applicable to this Agreement. 
  

	14.6	Severance of Invalid Provisions 

  
 If and for so long as any provision of this Agreement shall be deemed to be judged invalid for any reason whatsoever, such invalidity shall not affect the
validity or operation of any other provision of this Agreement except only so far as shall be necessary to give effect to the construction of such invalidity, and any such invalid provision shall be deemed severed from this Agreement without
affecting the validity of the balance of this Agreement. 
  

	14.7	Modifications 

  
 There shall be no modification of this Agreement except by written consent of all Parties; provided that if the Government elects to participate in the
rights and obligations of the Parties pursuant to the provisions of any applicable law or regulation, then: 
  

	 	A.	YFP shall contribute out of its Participating Interest the interest to be acquired by the Government; 

  

	 	B.	the Parties other than YFP shall not have any obligation to contribute and shall maintain their respective Participating Interests to the maximum extent allowed under applicable
laws; 

  

	 	C.	the Parties shall execute such documents as may be necessary to give effect to such transfer of interests and the joinder of Government or the Government Oil Company as a party to
this Agreement, but not the Participation Agreement or the Joint Venture Agreement; and 

  

	 	D.	all payments made by the Government or the Government Oil Company in respect of the transfer of such interest shall be credited to YFP. 

  

	14.8	Priority of Agreement 

  
 In the event of any conflict between the provisions of the main body of this Agreement and its Attachments, the provisions of the main body of this
Agreement shall prevail. In the event of any conflict between this Agreement, the JOA and the TAA, this Agreement shall prevail. In the event of a conflict between the JOA and the TAA, the TAA shall prevail. In the event of any conflict between this
Agreement and the Lease, this Agreement shall prevail unless such would be in violation of the Laws/Regulations of the Federal Republic of Nigeria or the terms of the Lease. In no event shall the JVA and the HOA have any effect upon the terms of
this Agreement. 
  

	14.9	Interpretation 

  

	 	A.	Headings. The topical headings used in this Agreement are for convenience only and shall not be construed as having any substantive significance or as indicating that all of the
provisions of this Agreement relating to any topic are to be found in any particular Article. 

  

	 	B.	Singular and Plural. Reference to the singular includes a reference to the plural and vice versa. 

  

	 	C.	Gender. Reference to any gender includes a reference to all other genders. 

  

	 	D.	Heading. Unless otherwise provided, reference to any Article or an Attachment means an Article or Attachment of the Agreement. 

  

	 	E.	Include. “include” and “including” shall mean to be inclusive without limiting the generality of the description preceding such term
and are used in an illustrative sense and not a limiting sense. 

  

 29 

	14.10 	Counterpart Execution 

  
 This Agreement may be executed in any number of counterparts and each such counterpart shall be deemed an original Agreement for all purposes; provided
that no Party shall be bound to this Agreement unless and until all Parties have executed a counterpart. For purposes of assembling all counterparts into one document, the Parties are authorized to detach the signature page from one or more
counterparts and, after signature thereof by the respective Party, attach each signed signature page to a counterpart. 
  

	14.11 	Public Announcements 

  
 No public announcement or statement regarding the terms or existence of this Agreement shall be made without prior written consent of all Parties;
provided that, notwithstanding any failure to obtain such approval, no Party shall be prohibited from issuing or making any such public announcement or statement to the extent it is necessary to do so in order to comply with the applicable laws,
rules or regulations of any government, legal proceedings or stock exchange having jurisdiction over such Party or its Affiliates, however, any such required public announcement shall include only that portion of the information which the disclosing
Party reasonably believes to be legally required. Such disclosing Party however shall then agree to use reasonable efforts to seek to obtain confidential treatment of the terms and conditions of this Agreement as may be available under applicable
law. In addition, such Party shall give notice to the other Parties of its intent to disclose as soon as practical, and in addition provide the text of such disclosure to the other Parties at least 24 hours in advance prior to its release to the
public. 
  

	14.12 	Third Parties 

  
 The Contracts (Rights of Third Parties) Act 1999 is hereby excluded and shall have no application to this Agreement. 
  

	14.13 	Consequential Loss 

  
 No Party shall have any liability under this Agreement for any indirect or consequential loss, including loss of profit, business interruption, loss of
bargain or loss of production. 
  

	14.14 	Entirety 

  
 With respect to the subject matter contained herein, this Agreement (i) is the entire agreement of the Parties; and (ii) supersedes all prior
understandings and negotiations of the Parties, including without limitation the HOA and the JVA. 
  

 30 

  
 IN WITNESS of their agreement each Party has
caused its duly authorized representative to sign this instrument on the date set out in the first sentence of this Agreement. 
  

									
	 Yinka Folawiyo Petroleum Company Limited
	 	 	 	 Syntroleum Nigeria Limited

					
	 By:
	 	 	 	 	 	 By:
	 	 
	 Name:
	 	 	 	 	 	 Name:
	 	 
	 Title:
	 	 	 	 	 	 Title:
	 	 
	 Date:
	 	 	 	 	 	 Date:
	 	 

  

									
	 Lundin Petroleum B.V.
	 	 	 	 Palace Exploration Company

					
	 By:
	 	 	 	 	 	 By:
	 	 
	 Name:
	 	 	 	 	 	 Name:
	 	 
	 Title:
	 	 	 	 	 	 Title:
	 	 
	 Date:
	 	 	 	 	 	 Date:
	 	 

  

									
	 Challenger Minerals Inc.
	 	 	 	 Providence Resources p.l.c.

					
	 By:
	 	 	 	 	 	 By:
	 	 
	 Name:
	 	 	 	 	 	 Name:
	 	 
	 Title:
	 	 	 	 	 	 Title:
	 	 
	 Date:
	 	 	 	 	 	 Date:
	 	 

  

			
	 Howard Energy Co., Inc.

		
	 By:
	 	 
	 Name:
	 	 
	 Title:
	 	 
	 Date:
	 	 

  

 31 

  
 ATTACHMENT
A 
 COPY OF OML 113 LEASE INSTRUMENT 
  
 Attached to and forming an integral part of the Participation Agreement.

  

 A-1 

  
 ATTACHMENT
B 
 FORM OF DEED OF ASSIGNMENT 
  
 Attached to and forming an integral part of the Participation Agreement.

  

 B-1 

  
 ATTACHMENT
C 
 FORM OF JOINT OPERATING AGREEMENT 
  
 Attached to and forming an integral part of the Participation Agreement.

  

 C-1 

  
 ATTACHMENT
D 
 FORM OF TECHNICAL ASSISTANCE AGREEMENT 

 
 Attached to and forming an integral part of the Participation Agreement.

  

 D-1 

  
 ATTACHMENT
E 
 FORM OF GUARANTEE 
  
 Attached to and forming an integral part of the Participation Agreement. 
  

 E-1 

  
 ATTACHMENT
F 
 FORM OF LETTER OF CREDIT 
  
 Attached to and forming an integral part of the Participation Agreement.

  

 F-1 

  
 ATTACHMENT
G 
 FORM OF CONVEYANCE OF OVERRIDING ROYALTY
INTEREST 
  
 Attached to and forming an integral
part of the Participation Agreement. 
  

 G-1 

  
 ATTACHMENT
H 
 ADTI DRILLING PROPOSAL 
  
 Attached to and forming an integral part of the Participation Agreement. 
  

 H-1 

  
 ATTACHMENT
I 
 FORM OF AREA OF MUTUAL INTEREST
AGREEMENT 
  
 Attached to and forming an
integral part of the Participation Agreement. 
  

 I-1 

  
 SCHEDULE
2.1(A) 
  
 Attached to and forming an integral part of the
Participation Agreement. 
  

	(i)	From the Effective Date until YFP Cost Recovery Payout 

  

																						
	 Party

	  	Participating
Interest

	 	 	Cost Bearing Participation

	 	 	Revenue Participation

	 
	  	 	Capex Paying
Interest

	 	 	Opex Paying
Interest

	 	 	Cost Recovery
Interest

	 	 	Profit Sharing
Interest

	 
	 	  	 	 	 	(x)	 	 	(y)	 	 	(x)	 	 	(y)	 	 	 	 	 	 	 
	 YFP
	  	60.000	%	 	0	%	 	0	%	 	0	%	 	0	%	 	25.000	%	 	25.000	%
	 Syntroleum
	  	13.000	%	 	10.000	%	 	32.500	%	 	10.000	%	 	32.500	%	 	24.375	%	 	24.375	%
	 Lundin
	  	12.000	%	 	40.000	%	 	30.000	%	 	40.000	%	 	30.000	%	 	22.500	%	 	22.500	%
	 Palace
	  	6.150	%	 	20.500	%	 	15.375	%	 	20.500	%	 	15.375	%	 	11.53125	%	 	11.53125	%
	 Challenger
	  	3.375	%	 	11.250	%	 	8.4375	%	 	11.250	%	 	8.4375	%	 	6.328125	%	 	6.328125	%
	 Providence
	  	3.375	%	 	11.250	%	 	8.4375	%	 	11.250	%	 	8.4375	%	 	6.328125	%	 	6.328125	%
	 Howard
	  	2.100	%	 	7.000	%	 	5.250	%	 	7.000	%	 	5.250	%	 	3.9375	%	 	3.9375	%
								
	 Total
	  	100	%	 	100	%	 	100	%	 	100	%	 	100	%	 	100	%	 	100	%

  

	 	(x)	For the costs of the Letter of Credit, the costs of the Initial Well, the costs of the Second Well and if agreed the costs of the Electromagnetic Survey; provided that with respect
to the Initial Well the current estimated costs to drill, log and abandon the Initial Well total USD$20,945,000 which include both actual and turnkey components as listed in the ADTI Turnkey Drilling Proposal dated December 2, 2004 attached as
Attachment H, subject to adjustment for actual rig and vessels rates, tangible costs, duties and taxes etc. as described in such proposal (“ADTI Proposal”). Following the logging of the Initial Well at total depth the Parties will agree on
the Testing procedure for the Initial Well, if any, as provided in the JOA. 

  

	 	(y)	For all costs after the Second Well is plugged and abandoned (temporarily or permanently). 

  
 During the period from the Effective Date until the plugging and abandonment of the Second Well, subject to prior election
by the Farmees to withdraw, Syntroleum shall not bear any overhead costs or indirect charges payable to the Technical Advisor under the JOA. The Farmees shall bear all such overhead costs or indirect charges in proportion to their Opex Paying
Interests. 
  

 2.1(A)-1 

	(ii)	After YFP Cost Recovery Payout and before Project Payout 

  

																						
	 Party

	  	Participating
Interest

	 	 	Cost Bearing Participation

	 	 	Revenue Participation

	 
	  	 	Capex Paying
Interest

	 	 	Opex Paying
Interest

	 	 	Cost Recovery
Interest

	 	 	Profit Sharing
Interest

	 
	 	  	 	 	 	(x)	 	 	(y)	 	 	(x)	 	 	(y)	 	 	 	 	 	 	 
	 YFP
	  	60.000	%	 	0	%	 	0	%	 	0	%	 	0	%	 	0	%	 	25.000	%
	 Syntroleum
	  	13.000	%	 	10.000	%	 	32.500	%	 	10.000	%	 	32.500	%	 	32.500	%	 	24.375	%
	 Lundin
	  	12.000	%	 	40.000	%	 	30.000	%	 	40.000	%	 	30.000	%	 	30.000	%	 	22.500	%
	 Palace
	  	6.150	%	 	20.500	%	 	15.375	%	 	20.500	%	 	15.375	%	 	15.375	%	 	11.53125	%
	 Challenger
	  	3.375	%	 	11.250	%	 	8.4375	%	 	11.250	%	 	8.4375	%	 	8.4375	%	 	6.328125	%
	 Providence
	  	3.375	%	 	11.250	%	 	8.4375	%	 	11.250	%	 	8.4375	%	 	8.4375	%	 	6.328125	%
	 Howard
	  	2.100	%	 	7.000	%	 	5.250	%	 	7.000	%	 	5.250	%	 	5.250	%	 	3.9375	%
								
	 Total
	  	100	%	 	100	%	 	100	%	 	100	%	 	100	%	 	100	%	 	100	%

  

	 	(x)	Same as Schedule 2.1(A)(i)(x). 

  

	 	(y)	Same as Schedule 2.1(A)(i)(y). 

  

	(iii)	After YFP Cost Recovery Payout and after Project Payout 

  

																						
	 Party

	  	Participating
Interest

	 	 	Cost Bearing Participation

	 	 	Revenue Participation

	 
	  	 	Capex Paying
Interest

	 	 	Opex Paying
Interest

	 	 	Cost Recovery
Interest

	 	 	Profit Sharing
Interest

	 
	 	  	 	 	 	(x)	 	 	(y)	 	 	(x)	 	 	(y)	 	 	(z)	 	 	 	 
	 YFP
	  	60.000	%	 	0	%	 	0	%	 	0	%	 	25.000	%	 	25.000	%	 	25.000	%
	 Syntroleum
	  	13.000	%	 	10.000	%	 	32.500	%	 	10.000	%	 	24.375	%	 	24.375	%	 	24.375	%
	 Lundin
	  	12.000	%	 	40.000	%	 	30.000	%	 	40.000	%	 	22.500	%	 	22.500	%	 	22.500	%
	 Palace
	  	6.150	%	 	20.500	%	 	15.375	%	 	20.500	%	 	11.53125	%	 	11.53125	%	 	11.53125	%
	 Challenger
	  	3.375	%	 	11.250	%	 	8.4375	%	 	11.250	%	 	6.328125	%	 	6.328125	%	 	6.328125	%
	 Providence
	  	3.375	%	 	11.250	%	 	8.4375	%	 	11.250	%	 	6.328125	%	 	6.328125	%	 	6.328125	%
	 Howard
	  	2.100	%	 	7.000	%	 	5.250	%	 	7.000	%	 	3.9375	%	 	3.9375	%	 	3.9375	%
								
	 Total
	  	100	%	 	100	%	 	100	%	 	100	%	 	100	%	 	100	%	 	100	%

  

	 	(x)	Same as Schedule 2.1(A)(i)(x). 

  

	 	(y)	Same as Schedule 2.1(A)(i)(y). 

  

 2.1(A)-2 

	 	(z)	If in any month after Project Payout: 

  

	 	(a)	any Party has not recovered all of the Capital Expenditures and Operating Expenditures that such Party incurred, then such Party shall be entitled to receive its Cost Recovery
Interest share of the funds in the Cost Recovery Account for such month until such Party has recovered all of the Capital Expenditures and Operating Expenditures that such Party actually incurred. 

  

	 	(b)	the amount of any Party’s Cost Recovery Interest share of the funds in the Cost Recovery Account for such month exceeds the amount of funds such Party is entitled to receive
under Schedule 2.1(A)(iii)(z)(a) for such month and if in such month any other Party has not yet recovered all of the Capital Expenditures and Operating Expenditures that such other Party actually incurred, then such excess shall be allocated to
such other Party until such other Party has recovered all of the Capital Expenditures and Operating Expenditures that such other Party has actually incurred. If two or more Parties have not yet recovered all of the Capital Expenditures and Operating
Expenditures that each such Party actually incurred, then such excess shall be allocated among them in proportion to their respective Cost Recovery Interests. 

  

	 	(c)	the amount of any Party’s Cost Recovery Interest share of the funds in the Cost Recovery Account for such month exceeds the amount of funds such Party is entitled to receive
under Schedule 2.1(A)(iii)(z)(a) for such month and if in such month all other Parties have recovered all of the Capital Expenditures and Operating Expenditures that such other Parties actually incurred, then such excess shall be transferred to the
Profit Account and distributed to the Parties in accordance with their respective Profit Sharing Interests. 

  

 2.1(A)-3 

  
 SCHEDULE
2.2(B)(iii) 
  
 Attached to and forming an integral part of the
Participation Agreement. 
  

																
	 Party

	  	 Participating
Interest

	 	 	Cost Bearing Participation

	 	 	Revenue Participation

	 
	  	 	Capex Paying
Interest

	 	 	Opex Paying
Interest

	 	 	Cost Recovery
Interest

	 	 	Profit Sharing
Interest

	 
	 YFP
	  	60.000	%	 	60.000	%	 	60.000	%	 	60.000	%	 	60.000	%
	 Syntroleum
	  	13.000	%	 	13.000	%	 	13.000	%	 	13.000	%	 	13.000	%
	 Lundin
	  	12.000	%	 	12.000	%	 	12.000	%	 	12.000	%	 	12.000	%
	 Palace
	  	6.150	%	 	6.150	%	 	6.150	%	 	6.150	%	 	6.150	%
	 Challenger
	  	3.375	%	 	3.375	%	 	3.375	%	 	3.375	%	 	3.375	%
	 Providence
	  	3.375	%	 	3.375	%	 	3.375	%	 	3.375	%	 	3.375	%
	 Howard
	  	2.100	%	 	2.100	%	 	2.100	%	 	2.100	%	 	2.100	%
						
	 Total
	  	100	%	 	100	%	 	100	%	 	100	%	 	100	%

  

 2.2(B)(iii)-1 

  
 SCHEDULE
4.1 
  
 Attached to and forming an integral part of the
Participation Agreement. 
  

	A.	Letter of Credit: Syntroleum and the Farmees shall deliver to YFP by 15 January 2005 the Letter of Credit in the amount of US$10,000,000. 

  

	 	(i)	Syntroleum and the Farmees shall bear the charges and obligations associated with the Letter of Credit in accordance with their Opex Paying Interests under Schedule 2.1(A)(i)(x).

  

	 	(ii)	If the Initial Well is drilled and plugged and abandoned (permanently or temporarily at the election of Parties pursuant to the JOA), then in accordance with the Letter of Credit
the Technical Advisor under the JOA shall be entitled to receive the full amount on deposit underlying the Letter of Credit plus accumulated interest on behalf of Syntroleum and the Farmees. 

  

	 	(iii)	If the Initial Well is not spudded in accordance with the provisions of, and within the time period provided in, Article 4.2(B), then YFP shall provide fifteen (15) days prior
written notice to Syntroleum and the Technical Advisor (with a copy to the Farmees) of YFP’s intention to draw on the Letter of Credit. 

  

	 	(iv)	If within five (5) days of receipt of YFP’s notice under Schedule 4.1(A)(iii) Syntroleum elects to cure such failure to spud by giving written notice to YFP and the Farmees
that Syntroleum commits to spud the Initial Well within one hundred eighty (180) days from Syntroleum’s notice, then the provisions Article 4.2(B)(i)(1) shall apply and unless Syntroleum fails to spud the Initial Well within such one hundred
eighty (180) days YFP shall not exercise its rights to invoke the payment of US$10,000,000 in accordance with the Letter of Credit. 

  

	 	(v)	If within five (5) days of receipt of YFP’s notice under Schedule 4.1(A)(iii) Syntroleum does not elect to cure under Schedule 4.1(A)(iv), then in accordance with the Letter of
Credit YFP shall be entitled to receive as liquidated damages the payment of the US$10,000,000 under the Letter of Credit and Technical Advisor under the JOA shall be entitled to receive the balance of the amount on deposit underlying the Letter of
Credit plus accumulated interest on behalf of Syntroleum and the Farmees. 

  

	 	(vi)	If Syntroleum exercises its right to cure under Schedule 4.1(A)(iv) and the Initial Well is drilled and plugged and abandoned (permanently or temporarily at the election of
Syntroleum), then in accordance with the Letter of Credit Syntroleum shall be entitled to receive the amount on deposit underlying the Letter of Credit plus accumulated interest. 

  

	 	(vii)	If Syntroleum exercises its right to cure under Schedule 4.1(A)(iv) and the Initial Well is not spudded within one hundred eighty (180) days from Syntroleum’s notice under
Schedule 4.1A(iv), then in accordance with the Letter of Credit YFP shall be entitled to receive as liquidated damages the payment of the US $10,000,000 under the Letter of Credit and Syntroleum shall be entitled to receive the balance of the amount
on deposit underlying the Letter of Credit plus accumulated interest. 

  

	 	(viii)	Delivery to YFP of copies of the daily drilling report for the relevant days shall be deemed to be conclusive evidence of spudding of the Initial Well, and of abandonment
(permanently or temporarily) of the Initial Well. 

  

	B.	 Signature Bonus of USD$16,875,000: The Farmees shall pay to YFP US$7,437,500 and to Syntroleum US$9,437,500 within five (5) days after the Approval Date by
wire transfer of 

  

 4.1-1 

	 	 
immediately available funds into the accounts designated in writing by YFP and Syntroleum, respectively. 

  

	C.	Extension Bonus of USD$2,000,000: Technical Advisor under the JOA shall pay to YFP the Extension Bonus of USD$2,000,000 within five (5) days after Syntroleum and/or the
Farmees submit a notice to YFP of their intent to drill the first Additional Well under Article 4.2D. Syntroleum and the Farmees shall bear the Extension Bonus in accordance with their Opex Paying Interests under Schedule 2.1A(i)(y).

  

	D.	Aje Commercial Bonus of USD$2,000,000: Technical Advisor under the JOA shall pay to YFP the Aje Commercial Bonus of USD$2,000,000 within five (5) days after Syntroleum and
the Farmees submit the first Declaration of Commerciality to YFP. Syntroleum and the Farmees shall bear the Aje Commercial Bonus in accordance with their Opex Paying Interests under Schedule 2.1(A)(i)(y). 

  

	E.	Development Bonus of USD$11,250,000: The Farmees shall pay to YFP US$5,625,000 and to Syntroleum US$5,625,000 within five (5) days after commencement of Commercial Production
under a Development Plan approved by the Government by wire transfer of immediately available funds into the accounts designated in writing by YFP and Syntroleum, respectively. 

  

	F.	GTL Site License: At such time as any of the Parties determine to develop Natural Gas produced from the Lease using the Syntroleum GTL Process as a Joint Operation or an
Exclusive Operation under the JOA, Syntroleum shall grant, or cause its Affiliates to grant, to the Parties participating in such development a site license for the right to use the Syntroleum GTL Process in such development with the then most
favorable royalty terms for plants of like size, configuration and throughput capacity. The rights and obligations under this Schedule 4.1(F) shall remain binding on Syntroleum for so long as the JOA is in effect and notwithstanding the withdrawal
of Syntroleum from this Agreement and the JOA. 

  

 4.1-2Syntroleum Employment Agreement

 Exhibit 10.47 
  
 Syntroleum Employment Agreement 
 CONFIDENTIAL 
  
 THIS EMPLOYMENT
AGREEMENT (the “Agreement”) is made and entered into on the 3rd day of January, 2005, by and between Syntroleum Corporation, a Delaware corporation (the “Company”), and Greg G. Jenkins, an individual (the “Employee”).

  
 WHEREAS, the Company desires to enter into an employment
relationship with Employee and Employee is willing to accept such employment on the terms and conditions set forth herein. 
  
 NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter contained, the Company and Employee hereby agree as follows.

  
 1. Employment and Duties. The Company employs Employee
in the capacity of Executive Vice President, Finance & Business Development and Chief Financial Officer, or in such other position and at such location as the Company may direct or desire and Employee hereby accepts such employment, on the terms
and conditions hereinafter set forth. Employee agrees to perform such services and duties (including reasonable travel) and hold such offices at such locations as may be reasonably assigned to him from time to time by the Company and to devote
substantially his full business time, energies and best efforts to the performance thereof to the exclusion of all other business activities, except any activities disclosed to the Company in advance and consented to by the Company. 
  
 2. Compensation. As compensation for the services to be rendered by
Employee to the Company pursuant to this Agreement, Employee shall be paid the following compensation and other benefits. 
  
 (a) Salary in the amount of $220,000 per year, payable in equal bi-weekly installments in arrears, or such higher compensation as may be established by
the Company from time to time. Payments of salary shall be made in accordance with the Company’s usual payroll procedures. 
  
 (b) Employee shall be eligible to participate, to the extent he may be eligible, in any group medical and hospitalization, profit sharing, retirement,
life insurance or other employee benefit plans which the Company may from time to time offer to its employees. All group insurance provided to Employee shall be in such form and provide such coverage as is provided to other employees of the Company.

  
 (c) All compensation payments to Employee shall be made
subject to normal deductions therefrom, including federal and state social security and withholding taxes. 
  
 3. Life Insurance. The Company, in its discretion, may apply for and procure in its own name and for its own benefit, life insurance on the life of
Employee in any amount(s) considered advisable by the Company. Employee shall submit to any medical or other examination and execute and deliver any application or other instrument in writing, reasonably necessary for the Company to acquire such
insurance. 
  
 4. Expenses. The Company shall reimburse
Employee for his actual out-of-pocket expenses incurred in carrying out his duties hereunder in the conduct of the Company’s business, which expenses shall be limited to ordinary and necessary items and which shall be supported by vouchers,
receipts or similar documentation submitted in accordance with the Company’s expense reimburse policy and as required by law. 
  
 5. Vacations and Leave. Employee shall be entitled to four weeks of vacation and leave in accordance with the Company’s policies in effect
from time to time. 
  

 Syntroleum Employment Agreement 
  
 CONFIDENTIAL 
  

 6. Non-Disclosure of Confidential Information. 
  
 (a) Employee acknowledges that in and as a result of his employment by the
Company, he will be making use of, acquiring, and/or adding to the Company’s Trade Secret Information. Except as required in the performance of Employee’s duties under this Agreement, Employee will not use any Trade Secret Information of
the Company for Employee’s own benefit or purposes or disclose to third parties, directly or indirectly, any Trade Secret Information of the Company, either during or after Employee’s employment with the Company. 
  
 (b) As used in this Agreement, “Trade Secret Information” means
information, including, but not limited to, any formula, pattern, compilation, program, device, method, technique or process, that: (i) derives independent economic value, actual or potential, from not being generally known to, and not being readily
ascertainable by proper means by other persons who can obtain economic value from its disclosure or use, and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. For purposes of this Agreement,
“Trade Secret Information” includes both information disclosed to Employee by the Company and information developed by Employee in the course of his employment with the Company. The types and categories of information which are considered
to be Trade Secret Information include, without limitation: (a) specifications, descriptions, designs, dimensions, content (including chemical composition) and tolerances of products, parts and components; (b) plans, blueprints, design packages
construction, part and assembly drawings and diagrams; (c) design, construction and component costs and cost estimates; (d) the existence, terms or conditions of any agreements (including license agreements) between the Company and any third party;
(e) computer programs (whether in the form of source code, object code or any other form, including software, firmware and programmable array logic), formulas, algorithms, methods, techniques, processes, designs, specifications, diagrams, flow
charts, manuals, descriptions, instructions, explanations, improvements, and the ideas, systems and methods of operation contained in such programs; (f) information concerning or resulting from research and development work performed by the Company;
(g) information concerning the Company’s management, financial condition, financial operations, purchasing activities, sales activities, marketing activities and business plans; (h) information acquired or compiled by the Company concerning
actual or potential customers; and (i) all other types and categories of information (in whatever form) with respect to which, under all the circumstances, Employee knows or has reason to know that the Company intends or expects secrecy to be
maintained and as to which the Company has made reasonable efforts to maintain its secrecy. 
  
 (c) In the event that Employee is requested or required by applicable law or by deposition, interrogatory, request for documents, subpoena, civil investigative demand or similar process to disclose any of the
Company’s Trade Secret Information, Employee shall provide the Company with prompt written notice of such request or requirement prior to making the requested disclosure, and shall cooperate with the Company so that the Company may seek to
protect the proprietary nature of such Trade Secret Information through available procedures, including a protective order or other appropriate remedy. 
  
 (d) The Company may also advise Employee from time to time as to restrictions upon the use or disclosure of specified information which has been licensed
or otherwise disclosed to the Company by third parties pursuant to license or confidential disclosure agreements which contain restrictions upon the use or disclosure of such information. Employee agrees to abide by the restrictions upon use and/or
disclosure contained in such agreements. 
  
 (e) Employee has not
and will not use or disclose to the Company any confidential or proprietary information belonging to others without the written consent of the person to whom such 

  

 2 

 Syntroleum Employment Agreement 
  
 CONFIDENTIAL 
  

 
information is confidential, and Employee represents that his employment with the Company will not require the use of such information or the violation of
any confidential relationship with any third party. 
  
 7.
Other Property of the Company. All documents, encoded media, and other tangible items provided to Employee by the Company or prepared, generated or created by Employee or others in connection with any business activity of the Company are the
property of the Company. Upon termination of Employee’s employment with the Company, Employee will promptly deliver to the Company all such documents, media and other items in his possession, including all complete or partial copies,
recordings, abstracts, notes or reproductions of any kind made from or about such documents, media, items or information contained therein. Employee will neither have nor claim any right, title or interest in any trademark, service mark or trade
name owned or used by the Company. 
  
 8. Inventions and Works
of Authorship. 
  
 (a) Employee agrees to assign and hereby
irrevocably assigns to the Company all of Employee’s right, title and interest in and to any and all Inventions and Works of Authorship made, generated or conceived by Employee during the period of his employment with the Company, and Employee
agrees to and shall promptly disclose all such Inventions and Works of Authorship to the Company in writing. As used herein, “Invention” means any discovery, improvement, innovation, idea, formula, or shop right (whether or not patentable,
whether or not put into writing and whether or not put into practice) made, generated or conceived by Employee (whether alone or with others) while employed by the Company. For purposes of this Agreement, any discovery, improvement, innovation,
idea, formula, or shop right (whether or not patentable, whether or not put into writing and whether or not put into practice) relating directly or indirectly to the business of the Company or to the Company’s actual or demonstrably anticipated
business, research or development with respect to which Employee files a patent application within two years after termination of employment with the Company shall be presumed to be an Invention. As used herein, “Work of Authorship” means
any original work of authorship within the purview of the copyright laws of the United States of America, and both the Company and Employee intend and agree that all Works of Authorship created by Employee in the course of his employment with the
Company will be and shall constitute works made for hire within the meaning and purview of such copyright laws. 
  
 (b) Employee will execute and assign any and all applications, assignments, and other documents and will render all assistance which may be reasonably
necessary for the Company to obtain patent, copyright, or any other form of intellectual property protection with respect to all Inventions and Works of Authorship in all countries and will cooperate with Syntroleum as reasonably necessary to
enforce any such intellectual property protection. The Company will pay Employee $200 for each patent issued to the Company upon which Employee’s name appears as an inventor. 
  
 (c) The provisions of this Paragraph 8 do not apply to an invention for which no equipment, supplies, facility or Trade
Secret Information of the Company was used and which was developed entirely on Employee’s own time, and which does not relate (i) directly or indirectly to the business, research or development of the Company, or (ii) to the Company’s
actual or demonstrably anticipated business, research or development. A reasonable determination of the applicability of this Paragraph 8(a) to an Employee’s invention shall be made by Syntroleum after the Employee submits notification in
writing of the invention. Said notice shall include adequate detail for Syntroleum to evaluate the invention. 
  

 3 

 Syntroleum Employment Agreement 
  
 CONFIDENTIAL 
  

 9. Limited Covenants Against Competition; Non-Solicitation. 
  
 (a) Employee acknowledges that the services he is to render to the Company
are of a special and unusual character with a unique value to the Company, the loss of which cannot adequately be compensated by damages in an action at law. In view of the unique value to the Company of the services of Employee and because of the
confidential Trade Secret Information to be obtained by or disclosed to Employee, as set forth above, and as a material inducement to the Company to enter into this Agreement and to pay to Employee the compensation stated in Paragraph 2, Employee
covenants and agrees that during the period of Employee’s employment within the Company and for a period of two years following termination of Employee’s employment with the Company for any reason, voluntarily or involuntarily, Employee
will not directly or indirectly: (i) start or participate or assist (as a proprietor, partner, shareholder, lender, investor, director, employee, consultant, independent contractor or otherwise) in starting any Competing Business; (ii) assist (as a
proprietor, partner, shareholder (except as a holder of 1% or less of the outstanding voting securities or income interest), lender, investor (except as a holder of 1% or less of the outstanding voting securities or income interest), director,
employee, consultant, independent contractor or otherwise) any existing Competing Business in the design, development or manufacture of any Competing Product; (iii) sell or assist in the sale of any Competing Product to any person or organization
with whom Employee had any contact while employed with the Company; (iv) directly or indirectly solicit for employment or employ any of the Company’s employees; or (v) become employed by a former employee of the Company. Because Syntroleum
actively pursues opportunities throughout the world and is engaged in a world-wide oriented business the Employee acknowledges the reasonableness of having no geographic limitation hereunder. 
  
 (b) Employee further acknowledges that, while employed by the Company, he
will have contact with and become aware of the Company’s customers and licensees and their respective representatives, including their names and addresses, specific needs and requirements, as well as leads and references to prospective
customers and licensees. Employee further acknowledges that loss of such customers or licensees would cause the Company great and irreparable harm. Employee agrees that for a period of two years following termination of Employee’s employment
with the Company for any reason, voluntarily or involuntarily, Employee will not directly or indirectly solicit, contact, call upon, communicate with or attempt to communicate with any customer or licensee, former customer or licensee, or
prospective customer or licensee of the Company for the purpose of selling, installing, implementing, or modifying any Competing Product. This restriction shall apply only to any customer or licensee, former customer or licensee, or prospective
customer or licensee of the Company with whom Employee had contact during the last two years of Employee’s employment with the Company. 
  
 (c) The Employee agrees that for as long as he is employed by the Company and for a period of two years after termination of Employee’s employment
with the Company for any reason, voluntarily or involuntarily, Employee will not solicit, recruit, hire or attempt to solicit, recruit or hire, directly or by assisting others, any other employee of the Company. 
  
 (d) As used in this Agreement, (i) “Competing Business” means any
person, entity or organization other than the Company which is engaged in or is about to become engaged in the design, manufacture or sale of a Competing Product, (ii) “Competing Product” means any product (including, without limitation,
any chemical formula or process) which is or may be marketed in competition with any product marketed or under development by the Company at any time, and (iii) “contact” means interaction between Employee and a customer or licensee,
former customer or licensee, or prospective customer or licensee of the Company, which takes place to further any business relationship; or performing services for the customer or licensee, former customer or licensee, or prospective customer or
licensee on behalf of the Company. 
  

 4 

 Syntroleum Employment Agreement 
  
 CONFIDENTIAL 
  

 10. Reasonableness of Restrictions. 
  
 (a) Employee expressly acknowledges that he has carefully read and considered
the provisions of Paragraphs 6, 7, 8 and 9, and, having done so, agrees that the restrictions set forth in these Paragraphs, including, but not limited to, the time periods and geographic areas of restriction are fair and reasonable and are
reasonably required for the protection of the interests of the Company and its officers, directors, shareholders and other employees. 
  
 (b) In the event that, notwithstanding the foregoing, any of the provisions of Paragraphs 6, 7, 8 and 9 shall be held to be invalid or unenforceable, the
remaining provisions thereof shall nevertheless continue to be valid and enforceable as though the invalid or unenforceable parts had not been included therein. In the event that any provision of Paragraphs 6, 7, 8 and 9 relating to the time period
and/or the areas of restriction and/or related aspects shall be declared by a court of competent jurisdiction to exceed the maximum restrictiveness such court deems reasonable and enforceable, the time period and/or areas of restriction and/or
related aspects deemed reasonable and enforceable by the court shall become and thereafter be the maximum restriction in such regard, and the restriction shall remain enforceable to the fullest extent deemed reasonable by such court. 
  
 11. Requests for Clarification. In the event Employee is uncertain as
to the meaning of any provision of this Agreement or its application to any particular information, item or activity, Employee will inquire in writing to the Company, specifying any areas of uncertainty. The Company will respond in writing within a
reasonable time and will endeavor to clarify any areas of uncertainty, including such things as whether it considers particular information to be its Trade Secret Information or whether it considers any particular activity or employment to be in
violation of this Agreement. 
  
 12. Remedies. In the event
of a breach or threatened breach of any of the covenants in Paragraphs 6, 7, 8 and 9, the Company shall have the right to seek monetary damages and equitable relief, including specific performance by means of an injunction against Employee or
against Employee’s partners, agents, representatives, servants, employers, employees, family members and/or any and all persons acting directly or indirectly by or with him, to prevent or restrain any such breach. 
  
 13. Term and Termination. 
  
 (a) The term of this Agreement shall be for an initial term of 12 months from
the effective date hereof, unless sooner terminated as provided herein, and shall thereafter be automatically renewed for successive terms of 12 months each unless sooner terminated as provided herein. 
  
 (b) Employment of Employee under this Agreement may be terminated:

  
 (i) by the Company upon the death of
Employee. 
  
 (ii) by the Company if Employee
becomes disabled. For the purposes of this Agreement, Employee will be deemed disabled if he (i) has been declared legally incompetent by a final court decree (the date of such decree being deemed to be the date on which the disability occurred), or
(ii) receives disability insurance benefits from any disability income insurance policy maintained by the Company for a period of three consecutive months, or (iii) has been found to be disabled pursuant to a disability determination. A
“disability determination” means a finding that Employee, because of a medically determinable disease, injury, or other mental or physical disability, is unable to perform substantially all of his regular duties to the Company and that
such 

  

 5 

 Syntroleum Employment Agreement 
  
 CONFIDENTIAL 
  

 
disability is determined or reasonably expected to last at least six months. The disability determination shall be based upon the written opinion of the
physician regularly attending Employee whose disability is in question. If the Company disagrees with the opinion of this physician (the “First Physician”), it may engage, at its own expense, another physician of its choice (the
“Second Physician”) to examine Employee. If the First and Second Physicians agree in writing that Employee is or is not disabled, their written opinion shall, except as otherwise set forth in this subsection, be conclusive on the issue of
disability. If the First and Second Physicians disagree on the disability of Employee, they shall choose a third consulting physician (whose expense shall be borne by the Company), and the written opinion of a majority of these three physicians
shall, except as otherwise provided in this subsection, be conclusive as to Employee’s disability. The date of any written opinion conclusively finding Employee to be disabled is the date on which the disability will be deemed to have occurred.
If there is a conclusive finding that Employee is not totally disabled, the Company shall have the right to request additional disability determinations provided it agrees to pay all the expenses of the disability determinations and does not request
an additional disability determination more frequently than once every three months. In connection with any disability determination, Employee hereby consents to any required medical examination, and agrees to furnish any medical information
requested by any examining physician and to waive any applicable physician-patient privilege that may arise because of such examination. All physicians except the First Physician must be board-certified in the specialty most closely related to the
nature of the disability alleged to exist. 
  
 (iii) by the Company when Employee reaches mandatory retirement age under any retirement policy applicable to all executive officers adopted by the Company. 
  
 (iv) by mutual agreement of Employee and the Company. 
  
 (v) by the Company upon the dissolution and liquidation of
the Company (other than as part of a reorganization, merger, consolidation or sale of all or substantially all of the assets of the Company whereby the business of the Company is continued). 
  
 (vi) by the Company for just cause at any time upon written
notice. For purposes of this Agreement, “just cause” shall mean any one or more of the following: (A) Employee’s material breach of his obligations, duties and responsibilities under any term or provision of this Agreement, which
breach remains uncured for a period of five days after written notice by the Company to Employee; (B) Employee’s failure to adhere to the reasonable standards of performance prescribed by the Company; (C) Employee’s act of insubordination
to the Company’s Board of Directors; (D) Employee’s gross negligence or willful misconduct in the performance of his duties under this Agreement; (E) Employee’s dishonesty, fraud, misappropriation or embezzlement in the course of,
related to or connected with the business of the Company; (F) Employee’s conviction of a felony; or (G) Employee’s failure (after written notice to Employee of such failure and Employee not correcting such failure within five days of such
notice) to devote his time, attention and best efforts to the business of the Company as provided in this Agreement. 
  
 (vii) by either the Company or Employee upon 60 days written notice. 
  
 (c) Any termination of Employee’s employment, either by the Company or Employee, shall be communicated by a written
notice of termination to the other party. 
  

 6 

 Syntroleum Employment Agreement 
  
 CONFIDENTIAL 
  

 (d) If Employee’s employment is terminated pursuant to the terms of this Agreement for any
reason, Employee shall be entitled to all arrearages of salary and expenses up to and including the date of termination but shall not be entitled to further compensation. Provided, that if, Employee’s employment is terminated by the Company for
any reason other than Employee’s death, disability or retirement, the Company’s dissolution or just cause as provided in Paragraphs 13(b)(i), (ii), (iii), (v) or (vi), respectively, Employee shall be entitled to and the Company shall pay
Employee all arrearages of salary and expenses up to and including the date of termination and, in addition, Employee’s monthly base salary for an additional period of 24 months. 
  
 (e) Upon expiration of the term of this Agreement or upon earlier termination of this Agreement, Employee shall deliver all
Trade Secret Information of the Company to an authorized representative of the Company, and the non-disclosure provisions of Paragraph 6 shall survive such expiration or termination and shall remain in full force and effect for a period of 15
years from such expiration or termination. 
  
 14. Change of
Control. 
  
 (a) In the event of a Change of Control of the
Company and (i) during the one-year period immediately following any Change of Control, the Company terminates Employee’s employment for any reason other than Employee’s death, disability, retirement or just cause as provided in Paragraphs
13(b)(i), (ii), (iii) and (vi), respectively, (ii) the Employee terminates his employment for Good Reason, or (iii) during the Window Period the Company or Employee terminates Employee’s employment for any reason, then the Company or its
successor shall pay Employee his full base salary in effect at the time of the notice of termination through the date of termination, and in lieu of any further salary payments for periods subsequent to the date of termination, the Company or its
successor shall pay Employee as severance pay an amount equal to two times Employee’s full base salary in effect on the date of termination payable in 24 equal monthly installments beginning on the first day of the first calendar month
following the date of Employee’s termination and continuing on the first day of each month thereafter until paid. 
  
 (b) Anything in this Agreement to the contrary notwithstanding, if a Change of Control occurs and if the Employee’s employment with the Company is
terminated prior to the date on which the Change of Control occurs, and if it is reasonably demonstrated by the Employee that such termination of employment (i) was at the request of a third party who has taken steps reasonably calculated to effect
the Change of Control or (ii) otherwise arose in connection with or anticipation of the Change of Control, then for all purposes of this Agreement, the “Change of Control” shall be deemed to have occurred on the date immediately prior to
the date of such termination of employment. 
  
 (c) as used in
this Agreement, the terms set forth below shall have the following respective meanings: 
  
 (i) “Affiliate” shall have the meaning ascribed to such term in Rule 12b-2 of the General Rules and Regulations under the
Exchange Act, as in effect on the Agreement Effective Date. 
  
 (ii) “Agreement Effective Date” shall mean January 3, 2005. 
  
 (iii) “Associate” shall mean, with reference to any Person, (a) any corporation, firm, partnership, association, unincorporated
organization or other entity (other than the Company or a subsidiary of the Company) of which such Person is an officer or general partner (or officer or general partner of a general partner) or is, directly or indirectly, the Beneficial Owner of
10% or more of any class 

  

 7 

 Syntroleum Employment Agreement 
  
 CONFIDENTIAL 
  

 
of equity securities, (b) any trust or other estate in which such Person has a substantial beneficial interest or as to which such Person serves as trustee
or in a similar fiduciary capacity and (c) any relative or spouse of such Person, or any relative of such spouse, who has the same home as such Person. 
  
 (iv) “Beneficial Owner” shall mean, with reference to any securities, any Person if: 
  
 (a) such Person or any of such Person’s Affiliates and
Associates, directly or indirectly, is the “beneficial owner” of (as determined pursuant to Rule 13d-3 of the General Rules and Regulations under the Exchange Act, as in effect on the Agreement Effective Date) such securities or otherwise
has the right to vote or dispose of such securities, including pursuant to any agreement, arrangement or understanding (whether or not in writing); provided, however, that a Person shall not be deemed the “Beneficial Owner” of, or to
“beneficially own,” any security under this subsection (a) as a result of an agreement, arrangement or understanding to vote such security if such agreement, arrangement or understanding: (i) arises solely from a revocable proxy or consent
given in response to a public (i.e., not including a solicitation exempted by Rule 14a-2(b)(2) of the General Rules and Regulations under the Exchange Act) proxy or consent solicitation made pursuant to, and in accordance with, the applicable
provisions of the General Rules and Regulations under the Exchange Act and (ii) is not then reportable by such Person on Schedule 13D under the Exchange Act (or any comparable or successor report); 
  
 (b) such Person or any of such Person’s Affiliates and
Associates, directly or indirectly, has the right or obligation to acquire such securities (whether such right or obligation is exercisable or effective immediately or only after the passage of time or the occurrence of an event) pursuant to any
agreement, arrangement or understanding (whether or not in writing) or upon the exercise of conversion rights, exchange rights, other rights, warrants or options, or otherwise; provided, however, that a Person shall not be deemed the Beneficial
Owner of, or to “beneficially own,” (i) securities tendered pursuant to a tender or exchange offer made by such Person or any of such Person’s Affiliates or Associates until such tendered securities are accepted for purchase or
exchange or (ii) securities issuable upon exercise of Exempt Rights; or 
  
 (c) such Person or any of such Person’s Affiliates or Associates (i) has any agreement, arrangement or understanding (whether or not in writing) with any other Person (or any Affiliate or Associate thereof) that
beneficially owns such securities for the purpose of acquiring, holding, voting (except as set forth in the proviso to subsection (a) of this definition) or disposing of such securities or (ii) is a member of a group (as that term is used in Rule
13d-5(b) of the General Rules and Regulations under the Exchange Act) that includes any other Person that beneficially owns such securities; 
  
 provided, however, that nothing in this definition shall cause a Person engaged in business as an underwriter of securities to be the Beneficial Owner of, or to
“beneficially own,” any securities acquired through such Person’s participation in good faith in a firm commitment underwriting until the expiration of 40 days after the date of such acquisition. For purposes hereof,
“voting” a security shall include voting, granting a proxy, consenting or making a request or demand relating to corporate action (including, without limitation, a demand for a stockholder list, to call a stockholder meeting or to inspect
corporate books and records) or otherwise giving an authorization (within the meaning of Section 14(a) of the Exchange Act) in respect of such security. 
  
 The terms “beneficially own” and “beneficially owning” shall have meanings that are correlative to this definition of the term
“Beneficial Owner.” 
  

 8 

 Syntroleum Employment Agreement 
  
 CONFIDENTIAL 
  

 (v) “Change of Control” shall mean any of the following (provided, however,
that without limiting the generality of any other provision hereof, no Change of Control shall be deemed to have occurred as a result of the consummation of any of the transactions contemplated by the Agreement and Plan of Merger dated as of March
30, 1998 by and between SLH Corporation, a Kansas corporation, and the Company (the “Merger Agreement”)): 
  
 (a) any Person (other than an Exempt Person) shall become the Beneficial Owner of 30% or more of the shares of Common Stock then
outstanding or 30% or more of the combined voting power of the Voting Stock of the Company then outstanding; provided, however, that no Change of Control shall be deemed to occur for purposes of this subsection (a) if such Person shall become a
Beneficial Owner of 30% or more of the shares of Common Stock or 30% or more of the combined voting power of the Voting Stock of the Company solely as a result of (i) an Exempt Transaction or (ii) an acquisition by a Person pursuant to a
reorganization, merger or consolidation, if, following such reorganization, merger or consolidation, the conditions described in clauses (i), (ii) and (iii) of subsection (c) of this definition are satisfied; 
  
 (b) individuals who, as of the Agreement Effective Date,
constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the Agreement Effective Date whose election, or
nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board;
provided, further, that there shall be excluded, for this purpose, any such individual whose initial assumption of office occurs as a result of any actual or threatened election contest that is subject to the provisions of Rule 14a-11 under the
Exchange Act; 
  
 (c) approval by the
shareholders of the Company of a reorganization, merger or consolidation, in each case, unless, following such reorganization, merger or consolidation, (i) more than 80% of the then outstanding shares of common stock of the corporation resulting
from such reorganization, merger or consolidation and the combined voting power of the then outstanding Voting Stock of such corporation is then beneficially owned, directly or indirectly, by all or substantially all of the Persons who were the
Beneficial Owners of the outstanding Common Stock immediately prior to such reorganization, merger or consolidation in substantially the same proportions as their ownership, immediately prior to such reorganization, merger or consolidation, of the
outstanding Common Stock, (ii) no Person (excluding any Exempt Person or any Person beneficially owning, immediately prior to such reorganization, merger or consolidation, directly or indirectly, 30% or more of the Common Stock then outstanding or
30% or more of the combined voting power of the Voting Stock of the Company then outstanding) beneficially owns, directly or indirectly, 30% or more of the then outstanding shares of common stock of the corporation resulting from such
reorganization, merger or consolidation or the combined voting power of the then outstanding Voting Stock of such corporation and (iii) at least a majority of the members of the board of directors of the corporation resulting from such
reorganization, merger or consolidation were members of the Incumbent Board at the time of the execution of the initial agreement or initial action by the Board providing for such reorganization, merger or consolidation; or 
  
 (d) approval by the shareholders of the Company of (i) a
complete liquidation or dissolution of the Company unless such liquidation or dissolution is approved as part of a plan of liquidation and dissolution involving a sale or disposition of all or substantially all of the assets of the Company to a
corporation with respect to which, following such sale or other disposition, all of 

  

 9 

 Syntroleum Employment Agreement 
  
 CONFIDENTIAL 
  

 
the requirements of clauses (ii)(A), (B) and (C) of this subsection (d) are satisfied, or (ii) the sale or other disposition of all or substantially all of
the assets of the Company, other than to a corporation, with respect to which, following such sale or other disposition, (A) more than 80% of the then outstanding shares of common stock of such corporation and the combined voting power of the Voting
Stock of such corporation is then beneficially owned, directly or indirectly, by all or substantially all of the Persons who were the Beneficial Owners of the outstanding Common Stock immediately prior to such sale or other disposition in
substantially the same proportion as their ownership, immediately prior to such sale or other disposition, of the outstanding Common Stock, (B) no Person (excluding any Exempt Person and any Person beneficially owning, immediately prior to such sale
or other disposition, directly or indirectly, 30% or more of the Common Stock then outstanding or 30% or more of the combined voting power of the Voting Stock of the Company then outstanding) beneficially owns, directly or indirectly, 30% or more of
the then outstanding shares of common stock of such corporation and the combined voting power of the then outstanding Voting Stock of such corporation and (C) at least a majority of the members of the board of directors of such corporation were
members of the Incumbent Board at the time of the execution of the initial agreement or initial action of the Board providing for such sale or other disposition of assets of the Company. 
  
 (vi) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended. 
  
 (vii) “Exempt Person” shall mean the Company, any
subsidiary of the Company, any employee benefit plan of the Company or any subsidiary of the Company, and any Person organized, appointed or established by the Company for or pursuant to the terms of any such plan. 
  
 (viii) “Exempt Rights” shall mean any rights to
purchase shares of Common Stock or other Voting Stock of the Company if at the time of the issuance thereof such rights are not separable from such Common Stock or other Voting Stock (i.e., are not transferable otherwise than in connection
with a transfer of the underlying Common Stock or other Voting Stock) except upon the occurrence of a contingency, whether such rights exist as of the Agreement Effective Date or are thereafter issued by the Company as a dividend on shares of Common
Stock or other Voting Securities or otherwise. 
  
 (ix) “Exempt Transaction” shall mean an increase in the percentage of the outstanding shares of Common Stock or the percentage of the combined voting power of the outstanding Voting Stock of the Company beneficially owned by any
Person solely as a result of a reduction in the number of shares of Common Stock then outstanding due to the repurchase of Common Stock or Voting Stock by the Company, unless and until such time as (a) such Person or any Affiliate or Associate of
such Person shall purchase or otherwise become the Beneficial Owner of additional shares of Common Stock constituting 1% or more of the then outstanding shares of Common Stock or additional Voting Stock representing 1% or more of the combined voting
power of the then outstanding Voting Stock, or (b) any other Person (or Persons) who is (or collectively are) the Beneficial Owner of shares of Common Stock constituting 1% or more of the then outstanding shares of Common Stock or Voting Stock
representing 1% or more of the combined voting power of the then outstanding Voting Stock shall become an Affiliate or Associate of such Person. 
  
 (x) “Good Reason” shall mean: 
  
 (a) the assignment to the Employee of any duties materially inconsistent in any respect with the Employee’s position (including
status, offices, titles and reporting requirements), authority, duties or responsibilities as contemplated by Section 1 of this 

  

 10 

 Syntroleum Employment Agreement 
  
 CONFIDENTIAL 
  

 
Agreement, or any other action by the Company which results in a diminution in such position, authority, duties or responsibilities, excluding for this
purpose an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by the Employee; 
  
 (b) any material failure by the Company to comply with any of the provisions of this Agreement, other than
an isolated, insubstantial and inadvertent failure not occurring in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by the Employee; 
  
 (c) the Company’s requiring the Employee to be based at any office outside the Tulsa metropolitan area;

  
 (d) any purported termination by the Company
of the Employee’s employment otherwise than as expressly permitted by this Agreement; or 
  
 (xi) “Person” shall mean any individual, firm, corporation, partnership, 
  
 association, trust, unincorporated organization or other entity. 
  
 (xii) “Voting Stock” shall mean, with respect to a
corporation, all securities of such corporation of any class or series that are entitled to vote generally in the election of directors of such corporation (excluding any class or series that would be entitled so to vote by reason of the occurrence
of any contingency, so long as such contingency has not occurred). 
  
 (xiii) “Window Period” shall mean the 60-day period immediately following elapse of one year after any Change of Control. 
  
 15. Resignation Upon Termination. In the event of termination of this Agreement other than for death, Employee agrees
to resign from all positions held in the Company, including without limitation any position as a director, officer, agent, trustee or consultant of the Company or any affiliate of the Company. 
  
 16. Notice to Subsequent Employers. For a period of two years after
termination of Employee’s employment with the Company for any reason, Employee will inform any new employer (before accepting employment) of the obligations of Employee under Paragraphs 6, 7, 8, 9, and 10 of this Agreement. 
  
 17. Obligations Unconditional. The obligations of the parties under
this Agreement are unconditional and do not depend upon the performance of any agreements, duties, obligations, or terms outside this Agreement. 
  
 18. Waiver. A party’s failure to insist on compliance or enforcement of any provision of this Agreement shall not affect the validity or
enforceability or constitute a waiver of future enforcement of that provision or of any other provision of this Agreement by that party or any other party. 
  
 19. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF OKLAHOMA, UNITED STATES OF
AMERICA, WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS THEREOF. 

  

 11 

 Syntroleum Employment Agreement 
  
 CONFIDENTIAL 
  

 
The Company and Employee expressly and irrevocably consent and submit to the nonexclusive jurisdiction of any state or federal court sitting in Tulsa County,
Oklahoma and agree that, to the fullest extent allowed by law, such Oklahoma state or federal courts shall have jurisdiction over any action, suit or proceeding arising out of or relating to this Agreement. The Company and Employee each irrevocably
waive, to the fullest extent allowed by law, any objection either of them may have to the laying of venue of any such suit, action or proceeding brought in any state or federal court sitting in Tulsa County, Oklahoma based upon a claim that such
court is inconvenient or otherwise an objectionable forum. Any process in any action, suit or proceeding arising out of or relating to this Agreement may, among other methods, be served upon the Company or Employee by delivering it or mailing it to
their respective addresses set forth herein. Any such delivery or mail service shall be deemed to have the same force and effect as personal service in the State of Oklahoma. 
  
 20. Severability. If for any reason any paragraph, term or provision of this Agreement is held to be invalid or
unenforceable for any reason, such invalidity or unenforceability shall not affect any other provision hereof, and this Agreement shall be construed and enforced as if such provision had not been included herein and all other valid provisions herein
shall remain in full force and effect. If for any reason the restrictions and covenants contained herein are held to cover a geographical area or be for a length of time which is unreasonable or unenforceable, or in any other way are construed to be
too broad or to any extent invalid, then to the extent the same are or would be valid or enforceable under applicable law, any court of competent jurisdiction shall construe and interpret or reform this Agreement to provide for a covenant having the
maximum area, time or other provisions (not greater than those contained herein) as shall be valid and enforceable under such applicable law. 
  
 21. Jurisdiction. The Company and Employee intend to and hereby confer jurisdiction to enforce the provisions of this Agreement and any restrictive
covenants contained herein upon the courts of any jurisdiction within the geographical scope of such covenants. If the courts of any one or more of such jurisdictions hold the provisions of this Agreement or any of the restrictive covenants
contained herein unenforceable by reason of the breadth of such scope or otherwise, it is the intention of the Company and Employee that such determination not bar or in any way affect the Company’s right to the relief provided herein in the
courts of any other jurisdiction within the geographical scope of such covenants, as to breaches of such covenants, such covenants as they relate to each jurisdiction being, for this purpose, severable into diverse and independent covenants.

  
 22. Notice. Any and all notices required or permitted
herein shall be deemed delivered if delivered personally or if mailed by registered or certified mail to the Company at its principal place of business and to Employee at the address hereinafter set forth following Employee’s signature, or at
such other address or addresses as either party may hereafter designate in writing to the other. 
  
 23. Amendments. This Agreement may be amended at any time by mutual consent of the parties hereto, with any such amendment to be invalid unless in
writing, signed by the Company and Employee. 
  
 24. Burden and
Benefit. This Agreement, together with any amendments hereto, shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors, assigns, heirs and personal representatives. The Company may, in its sole
discretion, assign this Agreement or its rights hereunder to any parent, affiliate, shareholder, or successor of the Company, or to any person or entity which purchases substantially all of the assets of the Company. Employee may not transfer or
assign this Agreement or any of Employee’s rights or obligations under this Agreement. 
  

 12 

 Syntroleum Employment Agreement 
  
 CONFIDENTIAL 
  

 25. References to Gender and Number Terms. In construing this Agreement, feminine or number
pronouns shall be substituted for those masculine in form and vice versa, and plural terms shall be substituted for singular and singular for plural in any place which the context so requires. 
  
 26. Headings. The various headings in this Agreement are inserted for
convenience only and are not part of the Agreement. 
  
 27.
Entire Agreement. This Agreement contains the entire understanding and agreement between the parties relating to the subject matter hereof. 
  
 28. Counterparts. This Agreement may be executed in one or more counterparts, and all such counterparts shall constitute one and the same
instrument. 
  
 29. Severance Compensation. In the event of
termination of Employee’s employment with the Company under the terms of this Agreement which provide for payment by the Company to Employee of severance compensation, the amount of such severance compensation shall in no event be greater than
the amount which would be deductible by the Company under Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), after taking into consideration all payments to Employee covered by Code Section 280G which Employee
receives or is deemed to receive (i) under this Agreement; (ii) under the Company’s 1993 Stock Option and Incentive Plan, as amended, by reason of the acceleration of the right to exercise any options (including any related stock appreciation
rights) granted thereunder or the acceleration of the vesting of any restricted stock awards granted thereunder; or (iii) under any new plan or arrangement implemented by the Company after the date of this Agreement which would otherwise be
considered a “parachute payment” under Section 280G. In the event such payments exceed the amount which would be deductible by the Company under Code Section 280G, the timing of such payments shall be extended or otherwise modified such
that such payments shall be deductible by the Company under Code Section 280G and in a manner which, to the extent possible, provides Employee the full benefit of such payments as originally agreed to. 
  
 IN WITNESS WHEREOF, the Company and Employee have duly executed this
Agreement as of the date and year first above written. 
  

			
	COMPANY:
	
	 SYNTROLEUM CORPORATION

		
	By:	 	 
	 	 	 John B. Holmes, Jr., President & CEO

		
	 	 	 Syntroleum Corporation
 4322 South 49th West Avenue
 Tulsa, OK 74107

  

			
	EMPLOYEE:
		
	By:	 	 
	 	 	 Greg G. Jenkins

		
	 	 	 Home address:
 2409 Dickey Place
 Houston, TX 77019

  

 13

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