Document:

SHARE
      EXCHANGE

    

    THIS
      PLAN AND AGREEMENT OF MERGER
      (hereinafter called the “Agreement”), dated as of October 25, 2007, is between
      Sound Worldwide, Ltd., a BVI corporation (“SOUND”), and Freedom 3, Inc., a
      Delaware corporation (“FREEDOM”).

    

    WHEREAS,
      on the
      date hereof FREEDOM is a corporation duly organized and existing under the
      laws
      of the State of Delaware, having authorized capital stock of 110,000,000 shares,
      100,000,000 of which are classified and designated as common stock, $0.0001
      par
      value, (“SUB Common Stock”) and 10,000,000 of which are classified and
      designated as preferred stock, $0.0001 par value (the “SUB Preferred
      Stock”);

    

    WHEREAS,
      SOUND
      is a corporation duly organized and existing under the laws of the BVI,
      currently having authorized capital stock of 50,000 shares of authorized common
      stock, par value $1.00 USD (the “PARENT Common Stock”), and 0 authorized
      preferred stock (the “SOUND Preferred Stock”);

    

    WHEREAS,
      there
      is 1 share of FREEDOM (“FREEDOM ISSUED Common Stock”) issued and outstanding and
      wherein SOUND owns 100% of the FREEDOM ISSUED Common Stock, and such shares
      constitute all of the issued and outstanding capital stock of
      FREEDOM;

    

    WHEREAS,
      the
      directors of FREEDOM and SOUND have determined it advisable and in the best
      interest of each company that the SOUND shares be exchanged with the shares
      of
      FREEDOM and upon the terms and subject to the conditions of this Agreement;
      and

    

    WHEREAS,
      the
      directors of FREEDOM and SOUND have unanimously approved this Agreement by
      written consent to action in lieu of a meeting and a majority of the
      shareholders of FREEDOM and SOUND have approved this Agreement by written
      consent to action in lieu of a meeting in accordance with the statutes of the
      state of Delaware and the BVI; and

    

    NOW
      THEREFORE,
      in
      consideration of the mutual agreements and covenants set forth herein, FREEDOM
      and SOUND hereby agree as follows:

     

    1. Share
      Exchange.
      Upon
      the terms and subject to the conditions set forth in this Agreement, SOUND
      shall
      exchange shares with shares in FREEDOM (the “Share Exchange”). The name of
      FREEDOM shall be changed to Sound Worldwide Holdings, Inc. The Share Exchange
      shall become effective upon the date of execution of this Agreement (the
“Effective Time” or the “Effective Date”).

    

    2. Succession;
      Officers and Directors.
      The
      directors of SOUND immediately prior to the Effective Time shall be the
      directors of FREEDOM, each to hold office in accordance with the Certificate
      of
      Incorporation and Bylaws of FREEDOM, and the officers of SOUND immediately
      prior
      to the Effective Time shall be the officers of FREEDOM, in each case until
      their
      resignation or their respective successors are duly elected or appointed and
      qualified. The employees and agents of SOUND shall become the employees and
      agents of FREEDOM entitled to the same rights and benefits which they enjoyed
      as
      employees and agents of SOUND.

    

    3. Further
      Assurances.
      From
      time to time, as and when required by FREEDOM, or by its successors and assigns,
      there shall be executed and delivered on behalf of FREEDOM such deeds and other
      instruments, and there shall be taken or caused to be taken by it all such
      further and other action, as shall be appropriate or necessary in order to
      vest,
      perfect or confirm, of record or otherwise, in FREEDOM the title to and
      possession of all property, interests, assets, rights, privileges, immunities,
      powers, franchises and authority of SOUND, and otherwise to carry out the
      purposes of this Agreement, and the officers and directors of FREEDOM are fully
      authorized in the name and on behalf of FREEDOM or otherwise, to take any and
      all such action and to execute, deliver, file, and/or record any and all
      instruments, papers, and documents which shall be or become necessary, proper,
      or convenient to carry out or put into effect any of the provisions of this
      Agreement or of the merger herein provided for.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    4. Share
      Exchange.

    

    a. At
      the
      Effective Time, each issued and outstanding share of SOUND Common Stock and
      each
      issued and outstanding share of SOUND Preferred Stock shall be converted into
      350
      fully
      paid and nonassessable shares of FREEDOM Common Stock and 1 fully paid and
      nonassessable share of FREEDOM Preferred Stock, as the case may be, without
      surrender of the certificate formerly representing such share of SOUND Common
      Stock or SOUND Preferred Stock (each a “SOUND Certificate”). From and after the
      Effective Time, all SOUND Common Stock and SOUND Preferred Stock shall no longer
      be outstanding and shall be deemed to be cancelled and retired and shall cease
      to exist, and each holder of any such SOUND Common Stock and SOUND Preferred
      Stock shall cease to have any rights with respect to any SOUND Certificate
      except the right to receive shares of FREEDOM Common Stock and/or FREEDOM
      Preferred Stock (the “Share Exchange Consideration”). 

    

    b. Exhibit
      A
      attached
      hereto sets forth the name of each holder of SOUND Common Stock and SOUND
      Preferred Stock.

    

    c. At
      the
      Effective Time, each share of common stock of FREEDOM (a “Share”) owned by the
      FREEDOM as treasury stock and each Share owned by the SOUND shall be cancelled
      and retired and shall cease to exist, and no consideration shall be delivered
      in
      exchange therefor.

    

    d. Mr.
      Roger
      Fan, Ms. Ivy Lam, and Mr. Hung Man To, shall, from and after the Effective
      Time,
      be the officers and directors, respectively, of FREEDOM until their successors
      shall have been duly elected or appointed or qualified or until their earlier
      death, resignation or removal in accordance with the certificate of
      incorporation and the by-laws of FREEDOM; and

    

    6. Amendment.
      Subject
      to the applicable law, this Agreement may be amended, modified or supplemented
      by written agreement of the parties at any time prior to the Effective
      Date.

    

    7. Counterparts.
      This
      Agreement may be executed in two or more counterparts, each of which shall
      be
      deemed to be an original and the same agreement. Telecopied or email (via PDF)
      signatures shall be deemed to have the same effect as an
      original.

    

    IN
      WITNESS WHEREOF,
      the
      undersigned Presidents, with the attestations of a Witness, of the respective
      constituent corporations, duly authorized hereunto, have executed this Agreement
      as of the date first above written.

    
      	 	 	 	 
	 	 	 	 
	Freedom
              3,
              Inc.	 	 	Sound
              Worldwide,
              Ltd.
	 	 	 	 
	 	 	 	 
	By:  /s/
              Roger K. W. Fan	 	 	By:  /s/
              Roger K. W. Fan 
	
              
                

              

              Roger
                K. W. Fan

              President,
                CEO

            	 	 	
              
                

              

              Roger
                K. W. Fan

              President,
                CEO

            

    
      
        
        

      

      
        2Exhibit
        10.57

    

     

    AMENDMENT
      NO. 3 AND WAIVER

     

    This Amendment
      No. 3 and Waiver (this
      "Agreement")
      dated
      as of October 24, 2007 (the "Effective
      Date"),
      is by
      and among Tekoil
      and Gas Gulf Coast, LLC,
      a
      Delaware limited liability company (the "Company"),
      Tekoil
      & Gas Corporation,
      a
      Delaware corporation, as guarantor (the "Guarantor"),
      the
      lenders party to the Credit Agreement described below ("Lenders"),
      J.
      Aron & Company,
      as Lead
      Arranger and as Syndication Agent (in such capacities, "Syndication
      Agent"),
      and
J.
      Aron & Company,
      as
      Administrative Agent for such Lenders (together with its permitted successors
      in
      such capacity, the "Administrative
      Agent")
      and as
      counterparty to the Company under the ISDA Agreement referred to below (in
      such
      capacity, "Lender
      Counterparty").

     

    RECITALS

     

    A. Reference
      is made to that certain Credit and Guaranty Agreement dated as of May 11,
      2007 among the Company, the Guarantor, the Lenders, the Syndication Agent and
      the Administrative Agent (as amended or supplemented to the date hereof, the
      "Credit
      Agreement").
      Reference is further made to that certain ISDA Master Agreement dated as of
      May
      11, 2007 (as amended, supplemented, or restated to the date hereof, and together
      with all confirmations issued thereunder, the "ISDA
      Agreement").

     

    B. Subject
      to the terms and conditions of this Agreement, the Company, the Guarantor,
      the
      Lenders, the Syndication Agent, the Administrative Agent and the Lender
      Counterparty, as applicable, wish to (i) make certain amendments to the Credit
      Agreement as provided herein and (ii) provide a waiver for the Waiver Defaults,
      as defined below.

     

    NOW
      THEREFORE, in consideration of their mutual undertakings, the Company, the
      Guarantor, the Lenders, the Syndication Agent, the Administrative Agent and
      the
      Lender Counterparty hereby agree as follows:

     

    Section
      1. Definitions
      and Interpretations.
      As used
      in this Agreement, each of the terms defined in the opening paragraph and the
      Recitals above shall have the meanings assigned to such terms therein. Each
      term
      defined in the Credit Agreement and used herein without definition shall have
      the meaning assigned to such term in the Credit Agreement, unless expressly
      provided to the contrary. Article, Section, Schedule, and Exhibit references
      are
      to this Agreement, unless otherwise specified. Paragraph headings have been
      inserted in this Agreement as a matter of convenience for reference only and
      it
      is agreed that such paragraph headings are not a part of this Agreement and
      shall not be used in the interpretation of any provision of this
      Agreement.

     

    Section
      2. Waiver.
      

     

    (a) The
      Company hereby acknowledges the existence of the following Events of Default
      (the "Waiver
      Defaults"):
      (i)
      the Company did not furnish the title opinions required by the Credit Agreement
      (the "Post-Closing
      Title Opinions")
      on or
      before August 15, 2007, which constitutes an Event of Default under the Credit
      Agreement, (ii) none of the following occurred on or before August 31, 2007:
      (A) the occurrence of the Required Capital Date, (B) the deposit of at
      least $7,500,000 of the amount contributed by Parent to Company on the Required
      Capital Date in the Collateral Account to be held under the control of
      Administrative Agent as cash collateral and applied to Other Permitted Capital
      Expenditures or other expenditures approved in writing by the Required Lenders
      and (C) the repayment in full of the insurance premium financing
      Indebtedness described on Schedule 6.1 to the Credit Agreement from sources
      other than the amounts deposited pursuant to clause (B) above, which constitutes
      an Event of Default under the Credit Agreement, (iii) the Rail Road Commission
      of Texas has not approved the P-4 certificates submitted by the Company with
      respect to the wells operated by the Sellers, which constitutes a failure of
      the
      Company to comply with all requirements of the Credit Agreement and therefore
      constitutes
      an Event of Default under the Credit Agreement,
      (iv)
a
      mechanic's and materialman's lien was filed in Chambers County on July 23,
      2007
      by K-3 Resources, L.P. for unpaid invoices relating to work performed on
      February 3, 2007, on Well No. 1, Point Barrow SWD Lease,
      which
      Lien is not permitted under the Credit Agreement and therefore constitutes
      an
      Event of Default under the Credit Agreement, and (v) the existence of the
      foregoing Events of Default under the Credit Agreement constitutes an Event
      of
      Default under the ISDA Agreement.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (b) Subject
      to the terms and conditions of this Agreement, the Lenders and the Lender
      Counterparty, as applicable, hereby waive the Waiver Defaults. The waiver by
      the
      Lenders and the Lender Counterparty described in this Section 2 is contingent
      upon the satisfaction of the conditions precedent set forth below in this
      Agreement and is limited to the Waiver Defaults. Such waiver shall not be
      construed to be a consent to or a permanent waiver of any Section covered by
      either of the Waiver Defaults or any other terms, provisions, covenants,
      warranties or agreements contained in the Credit Agreement, the ISDA Agreement,
      or in any of the other Transaction Documents. The Lenders and the Lender
      Counterparty reserve the right to exercise any rights and remedies available
      to
      them in connection with any other present or future defaults with respect to
      the
      Credit Agreement, the ISDA Agreement, or any other provision of any Transaction
      Document. The description herein of the Waiver Defaults is based upon the
      information available to the Lenders and the Lender Counterparty on the date
      hereof and shall not be deemed to exclude the existence of any other Events
      of
      Default. The failure of the Lenders or the Lender Counterparty to give notice
      to
      any Credit Party of any such other Events of Default is not intended to be
      nor
      shall be a waiver thereof. The Company and the Guarantor hereby agree and
      acknowledge that the Lenders and the Lender Counterparty require and will
      require strict performance by the Company and the Guarantor of all of their
      respective obligations, agreements and covenants contained in the Credit
      Agreement, the ISDA Agreement, and the other Transaction Documents, as amended
      hereby, and no inaction or action regarding any Event of Default is intended
      to
      be or shall be a waiver thereof. 

     

    (c) Without
      limitation of the foregoing, any failure (i) to deliver acceptable Post-Closing
      Title Opinions by the date set forth in Section 8.1(s) of the Credit Agreement
      (as amended hereby) or to comply with all reasonable requirements made by the
      Administrative Agent pursuant to such opinions by such date, (ii) of any of
      the
      items listed in Section 8.1(n) of the Credit Agreement (as amended hereby)
      to
      occur by the date set forth in Section 8.1(n) of the Credit Agreement (as
      amended hereby), (iii) to obtain any of the approvals required by Section 8.1(v)
      of the Credit Agreement by the date set forth in Section 8.1(v) of the Credit
      Agreement, or (iv) to pay any of the obligations required by Section 8.1(w)
      of
      the Credit Agreement by the date set forth in Section 8.1(w) of the Credit
      Agreement or to obtain the release of any related Liens as required thereunder,
      shall constitute an Event of Default under the Credit Agreement, and any such
      Event of Default under the Credit Agreement shall constitute an Event of Default
      under the ISDA Agreement.

     

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

    

     

    (d) Notwithstanding
      the foregoing waiver of the Waiver Defaults, until the Capitalization Date
      (as
      hereinafter defined), for purposes of the following Sections of the Credit
      Agreement, the Administrative Agent may at its election exercise the rights
      and
      receive the benefits, and the Company shall have the obligations, which are
      applicable under such Sections during the existence of an Event of Default:
      (i)
      Section 1.1, definition of "ANCF Capital Expenditures," (ii) Section 1.1,
      definition of "Permitted G&A Expense Amount," (iii) Section 2.6(c)(ii)
      (monthly interest payments), (iv) Section 2.8 (default interest), (v) Section
      2.19 (collateral account), (vi) Section 5.2(e) (independent engineer's reports);
      (vii) Section 6.6 (distributions), and (viii) Section 10.6
      (assignments).

     

    Section
      3. Amendments
      to the Credit Agreement.
      

     

    (a) Section
      8.1(n) of the Credit Agreement is hereby deleted in its entirety and replaced
      with the following:

     

    (n) Any
      of
      the following shall not have occurred on or before October 26, 2007:
      (i) the occurrence of the Required Capital Date, (ii) the deposit of
      at least $7,500,000 of the amount contributed by Parent to Company on the
      Required Capital Date in the Collateral Account to be held under the control
      of
      Administrative Agent as cash collateral and applied to Other Permitted Capital
      Expenditures or other expenditures or obligations approved in writing or
      required by the Required Lenders (including without limitation application
      to
      the reduction of outstanding principal, interest and other sums owed by the
      Company on the Loans, the other Obligations, or otherwise under the Transaction
      Documents) and (iii) the repayment in full of the insurance premium
      financing Indebtedness described on Schedule 6.1 (from sources other than
      amounts deposited pursuant to clause (ii) above) (the date on which the
      foregoing items (i), (ii), and (iii) are satisfied, the "Capitalization
      Date");

     

    (b) Section
      8.1(s) of the Credit Agreement is hereby deleted in its entirety and replaced
      with the following:

     

    (s) Company
      shall fail to (i) on or before November 7, 2007 (A) furnish, title
      opinions, in form and substance reasonably satisfactory to Administrative Agent,
      covering Texas State Lease MF062790 (State Tract 343), and any lease pooled
      or
      unitized therewith, specifically addressing, without limitation, the interests
      of Borrower in and to the following wells and non-producing reserves: State
      Tract 343#014, State Tract 343 #009, State Tract 343 #018 (BP01), State Tract
      343 #014 (BP03), or (B) comply with all reasonable requirements made by
      Administrative Agent pursuant to such title opinions or (ii) on or before
      January 23, 2008 (A) furnish title opinions, in form and substance reasonably
      satisfactory to Administrative Agent, covering Texas State Lease MF030085 (State
      Tract 5-8A), and any lease pooled or unitized therewith, specifically
      addressing, without limitation, the interests of Borrower in and to the
      following wells and non-producing reserves: State Tract 5-8A #02, State Tract
      5-8A #01, State Tract 5-8 #01(BP01), State Tract 5-8A #01(BP02), or (B) comply
      with all reasonable requirements made by Administrative Agent pursuant to such
      title opinions; 

     

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

     

    (c) Section
      8.1 of the Credit Agreement is amended by adding the following clause (u) in
      appropriate alphabetical order:

     

    (u) At
      any
      time after the execution and delivery thereof, the Limited Guaranty dated as
      of
      October 23, 2007, made by Mark S. Western for the ratable benefit of the
      Beneficiaries, for any reason, other than the satisfaction in full of all
      Obligations, shall cease to be in full force and effect with respect to Mark
      S.
      Western (other than in accordance with its terms) or shall be declared to be
      null and void or Mark S. Western shall repudiate his obligations
      thereunder.

     

    (d) Section
      8.1 of the Credit Agreement is amended by adding the following clause (v) in
      appropriate alphabetical order:

     

    (v) The
      Railroad Commission of Texas shall not have approved, on or before
      January 23, 2008, all of the change of operator P-4 submissions made by
      Company with respect to the wells operated by the Sellers; or

     

    (e) Section
      8.1 of the Credit Agreement is amended by adding the following clause (w) in
      appropriate alphabetical order:

     

    (w) Any
      of
      the following shall not have occurred on or before the earlier of (i) the
      Required Capital Date and (ii) October 26, 2007: (A) the repayment in full
      of
      all amounts owing to K-3 Resources, L.P. relating to work performed on February
      3, 2007, on Well No. 1, Point Barrow SWD Lease and/or secured by the mechanic's
      and materialman's lien filed in Chambers County on July 23, 2007 (which payment,
      if made on the Required Capital Date, may be made from funds contributed by
      Parent to Company on such date) and (B) arrangements satisfactory to
      Administrative Agent shall have been made for the release of such mechanic's
      and
      materialman's lien. Company hereby covenants and agrees to take all actions
      necessary or requested by Administrative Agent to obtain the release of the
      foregoing mechanic's and materialman's lien.

     

    (f) Section
      8.1 of the Credit Agreement is amended by adding the following clause (x) in
      appropriate alphabetical order:

     

    (x) Company
      shall not have deposited in the Collateral Account, on or before November 23,
      2007, $370,000 or such greater amount as is sufficient in accordance with GAAP
      to adequately reserve for the Liabilities asserted by J-W Power to be owed
      by
      Company and/or Sellers, such amounts to be held under the control of
      Administrative Agent as cash collateral and applied to satisfy such Liabilities
      or other obligations approved in writing or required by the Required Lenders
      (including without limitation application to the reduction of outstanding
      principal, interest and other sums owed by the Company on the Loans, the other
      Obligations, or otherwise under the Transaction Documents).

     

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

    

     

    (g) In
      addition, for purposes of Section 8.1 of the Credit Agreement Mark S. Western
      shall constitute a "Credit Party."

     

    (h) The
      Credit Agreement is amended by replacing Schedule 4.9 thereto with the Schedule
      4.19 attached hereto.

     

    Section
      4. No
      Obligation to Make Payments; Application.
      Notwithstanding anything herein to the contrary, Company hereby acknowledges,
      confirms and agrees that for so long as any Event of Default or Potential Event
      of Default (as such terms are defined in the ISDA Agreement) is outstanding
      with
      respect to Company, and at all time prior to the Capitalization Date (a) any
      obligation Lender Counterparty may have to make any payment under the ISDA
      Agreement shall be suspended and (b) any amounts payable by Lender Counterparty
      under the ISDA Agreement may be applied to the Obligations at the Administrative
      Agent's election, in such order as may be elected by the Administrative Agent
      in
      its sole discretion.

     

    Section
      5. Representations
      and Warranties.
      

     

    (a) The
      Guarantor represents and warrants that (i) after giving effect to this
      Agreement, the representations and warranties set forth in the Credit Agreement,
      the representations and warranties set forth in the ISDA Agreement, and the
      representations and warranties contained in the other Transaction Documents
      to
      which the Guarantor is a party are true and correct in all material respects
      on
      and as of the Effective Date as if made on and as of such date; (ii) other
      than
      the Waiver Defaults, no Default or Event of Default, or Event of Default or
      Potential Event of Default (as such terms are defined in the ISDA Agreement)
      has
      occurred and is continuing; (iii) the execution, delivery and performance of
      this Agreement and the other documents, instruments, certificates and agreements
      required to be delivered by this Agreement ("Other
      Documents")
      and to
      which the Guarantor is a party are within the corporate power and authority
      of
      the Guarantor and have been duly authorized by appropriate corporate action
      and
      proceedings; (iv) this Agreement and the Other Documents to which the Guarantor
      is a party constitute legal, valid, and binding obligations of the Guarantor
      enforceable in accordance with their respective terms, except as limited by
      applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws
      affecting the rights of creditors generally and general principles of equity;
      (v) there are no governmental or other third party consents, licenses and
      approvals required in connection with the execution, delivery, performance,
      validity and enforceability of this Agreement or any of the Other Documents
      to
      which the Guarantor is a party; and (vi) the Liens under the Security Documents
      are valid and subsisting and secure the Company's and the Guarantor's
      obligations under the Credit Agreement, the ISDA Agreement, and the other
      Transaction Documents.

     

    (b) The
      Company represents and warrants that: (i) after giving effect to this Agreement,
      the representations and warranties contained in the Credit Agreement, the
      representations and warranties set forth in the ISDA Agreement, and the
      representations and warranties contained in the other Transaction Documents
      to
      which the Company is a party are true and correct in all material respects
      on
      and as of the Effective Date as if made on and as of such date; (i) other than
      the Waiver Defaults, no Default or Event of Default or Event of Default or
      Potential Event of Default (as such terms are defined in the ISDA Agreement)
      has
      occurred and is continuing; (ii) the execution, delivery and performance of
      this
      Agreement and the Other Documents to which the Company is a party are within
      the
      limited liability company power and authority of the Company and have been
      duly
      authorized by appropriate limited liability company action and proceedings;
      (iv)
      this Agreement and the Other Documents to which the Company is a party
      constitute legal, valid, and binding obligations of the Company enforceable
      in
      accordance with their respective terms, except as limited by applicable
      bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting
      the rights of creditors generally and general principles of equity; (v) there
      are no governmental or other third party consents, licenses and approvals
      required in connection with the execution, delivery, performance, validity
      and
      enforceability of this Agreement or any of the Other Documents to which the
      Company is a party; and (vi) the Liens under the Security Documents are valid
      and subsisting and secure Company's obligations under the Credit Agreement,
      the
      ISDA Agreement, and the other Transaction Documents.

     

    
      
         

      

      
        -5-

        
          

        

      

      
         

      

    

     

    Section
      6. Conditions
      to Effectiveness.
      This
      Agreement shall become effective and enforceable against the parties hereto,
      the
      Credit Agreement shall be amended as provided herein, upon the occurrence of
      the
      following conditions precedent on or before the Effective Date:

     

    (a) Agreement.
      The
      Administrative Agent shall have received multiple original counterparts of
      this
      Agreement duly and validly executed and delivered by duly authorized officers
      of
      the Company, the Guarantor, the Administrative Agent, the Lenders, and the
      Lender Counterparty; 

     

    (b) No
      Default; Representations.
      Other
      than the Waiver Defaults, no Default or Event of Default or Event of Default
      or
      Potential Event of Default (as such terms are defined in the ISDA Agreement)
      shall have occurred and be continuing as of the Effective Date. The
      representations and warranties in this Agreement, and in the Credit Agreement
      and the ISDA Agreement, shall be true and correct in all material
      respects;

     

    (c) Closing
      Documents List.
      The
      Administrative Agent shall have received, and shall be satisfied in its sole
      discretion with, the other items listed on the Closing Documents List attached
      hereto as Exhibit
      A.

     

    (d) Fees.
      The
      Company shall have paid (i) a waiver and amendment fee equal to $367,522 and
      (ii) all fees and expenses of the Administrative Agent's outside legal counsel
      and other consultants pursuant to all invoices presented for payment on or
      prior
      to the Effective Date.

     

    Section
      7. Effect
      on Transaction Documents; Acknowledgments.
      

     

    (a) The
      Company and the Guarantor each acknowledges that on the date hereof all
      Obligations are payable without defense, offset, counterclaim or
      recoupment.

     

    (b) Except
      as
      set forth in Section 2 above, the Lenders, Lender Counterparty, and
      Administrative Agent hereby expressly reserve all of their respective rights,
      remedies, and claims under the Credit Agreement, the ISDA Agreement, and the
      other Transaction Documents. Nothing in this Agreement shall constitute a waiver
      or relinquishment of (i) any Default or Event of Default, or any Event of
      Default or Potential Event of Default (as such terms are defined in the ISDA
      Agreement), under the Credit Agreement, the ISDA Agreement, or any of the other
      Transaction Documents other than as expressly set forth in Section 2 above,
      (ii)
      any of the agreements, terms or conditions contained in the Credit Agreement,
      the ISDA Agreement, or any of the other Transaction Documents, (iii) any rights
      or remedies of the Lenders, Lender Counterparty, Administrative Agent, Royalty
      Owner, or Warrant Owner with respect to the Credit Agreement, the ISDA
      Agreement, and the other Transaction Documents, or (iv) the rights of each
      of
      the Lenders, the Lender Counterparty, and the Administrative Agent to collect
      the full amounts owing to it under the Credit Agreement, the ISDA Agreement,
      and
      the other Transaction Documents.

     

    
      
         

      

      
        -6-

        
          

        

      

      
         

      

    

     

    (c) The
      Company, the Guarantor, the Lenders and Administrative Agent, each hereby
      adopts, ratifies, and confirms the Credit Agreement, as amended hereby, and
      the
      Company, the Guarantor, and the Lender Counterparty each hereby adopts,
      ratifies, and confirms the ISDA Agreement, and each of the foregoing parties
      acknowledges and agrees that the Credit Agreement, as amended hereby, the ISDA
      Agreement and the other Transaction Documents are and remain in full force
      and
      effect, and the Company and the Guarantor each acknowledges and agrees that
      neither its liabilities under the Credit Agreement, the ISDA Agreement, and
      the
      other Transaction Documents nor the validity, perfection, or priority of any
      lien or security interest securing the Obligations are impaired in any respect
      by this Agreement.

     

    (d) From
      and
      after the Effective Date, all references to the Credit Agreement, the ISDA
      Agreement, and the Transaction Documents shall mean such Credit Agreement,
      such
      ISDA Agreement, and such Transaction Documents as amended by this
      Agreement.

     

    (e) This
      Agreement and each of the Other Documents (including without limitation the
      Limited Guaranty made by Mark S. Western of even date herewith) is a Transaction
      Document for the purposes of the provisions of the other Transaction Documents.
      Without limiting the foregoing, any breach of representations, warranties,
      and
      covenants under this Agreement shall be a Default or Event of Default, as
      applicable, under the Credit Agreement.

     

    Section
      8. Reaffirmation
      of the Guaranty.
      The
      Guarantor hereby ratifies, confirms, and acknowledges that its obligations
      under
      the Guaranty are in full force and effect and that the Guarantor continues
      to
      unconditionally and irrevocably guarantee the full and punctual payment, when
      due, whether at stated maturity or earlier by acceleration or otherwise, all
      of
      the Guaranteed Obligations as such Guaranteed Obligations have been increased
      and amended by this Agreement. The Guarantor hereby acknowledges that its
      execution and delivery of this Agreement does not indicate or establish an
      approval or consent requirement by the Guarantor under the Credit Agreement
      in
      connection with the execution and delivery of amendments to the Credit
      Agreement, the Notes, the ISDA Agreement, or any of the other Transaction
      Documents.

     

    Section
      9. Release
      of Claims.
      

     

    (a) TO
      INDUCE ADMINISTRATIVE AGENT, LENDERS, AND LENDER COUNTERPARTY TO AGREE TO THE
      TERMS OF THIS AGREEMENT, EACH CREDIT PARTY HEREBY (A) REPRESENTS AND WARRANTS
      THAT, AS OF THE DATE OF THIS AGREEMENT, THERE ARE NO CLAIMS OR OFFSETS AGAINST
      OR DEFENSES OR COUNTERCLAIMS TO ITS OBLIGATIONS UNDER THE TRANSACTION DOCUMENTS
      OR UNDER THE ISDA AGREEMENT, AND WAIVES ANY AND ALL SUCH CLAIMS, OFFSETS,
      DEFENSES, OR COUNTERCLAIMS, WHETHER KNOWN OR UNKNOWN, ARISING PRIOR TO THE
      DATE
      OF THIS AGREEMENT, (B) RELEASES AND FOREVER DISCHARGES THE RELEASED PERSONS
      (AS
      HEREINAFTER DEFINED) FROM ANY AND ALL RELEASED CLAIMS (AS HEREINAFTER DEFINED),
      AND (C) COVENANTS NOT TO ASSERT (AND NOT TO ASSIST OR ENABLE ANY OTHER PERSON
      TO
      ASSERT) ANY RELEASED CLAIM AGAINST ANY RELEASED PERSON. THE CREDIT PARTIES
      ACKNOWLEDGE AND AGREE THAT SUCH RELEASE IS A GENERAL RELEASE OF ANY AND ALL
      RELEASED CLAIMS THAT CONSTITUTES A FULL AND COMPLETE SATISFACTION FOR ALL OR
      ANY
      ALLEGED INJURIES OR DAMAGES ARISING OUT OF OR IN CONNECTION WITH THE RELEASED
      CLAIMS, ALL OF WHICH ARE HEREIN COMPROMISED AND SETTLED. 

     

    
      
         

      

      
        -7-

        
          

        

      

      
         

      

    

     

    (b) As
      used
      above, "Released Claims" shall mean any and all actions, causes of action,
      judgments, executions, suits, debts, claims, demands, controversies,
      liabilities, obligations, damages and expenses of any and every character
      (whether known or unknown, liquidated or unliquidated, absolute or contingent,
      acknowledged or disputed, direct or indirect), at law or in equity, of
      whatsoever kind or nature (including claims of usury), whether heretofore or
      hereafter accruing, for or because of any matter or things done, omitted or
      suffered to be done by any of the Released Persons prior to and including the
      date hereof that in any way directly or indirectly arise out of or in any way
      are connected to (i) any of the Transaction Documents or the ISDA Agreement
      or
      any default or event of default thereunder, (ii) any negotiation, discussion,
      enforcement action, agreement or failure to agree related to any Transaction
      Document, the ISDA Agreement or any default or event of default thereunder,
      or
      (iii) any action, event, occurrence, or omission otherwise related to the
      rights, duties, obligations and relationships among the various Credit Parties,
      Administrative Agent, Lenders, and Lender Counterparty; provided, however,
      that
“Released Claims” shall not include any outstanding obligations owed as of the
      date of this Agreement to Company by Lender Counterparty, or any affiliate
      thereof, under the express terms of the ISDA Agreement, and "Released Persons"
      shall mean Administrative Agent, Lenders, Royalty Owner, Warrant Owner, and
      Lender Counterparty, together with their respective employees, agents,
      attorneys, officers, partners, shareholders, accountants, consultants,
      directors, and Affiliates, and their respective successors and
      assigns.

     

    Section
      10. Miscellaneous.
      

     

    (a) Counterparts.
      This
      Agreement may be signed in any number of counterparts, each of which shall
      be an
      original and all of which, taken together, constitute a single instrument.
      This
      Agreement may be executed by facsimile signature and all such signatures shall
      be effective as originals.

     

    (b) Successors
      and Assigns.
      This
      Agreement shall be binding upon and inure to the benefit of the parties hereto
      and their respective successors and assigns permitted pursuant to the Credit
      Agreement or ISDA Agreement, as applicable.

     

    (c) Invalidity.
      In the
      event that any one or more of the provisions contained in this Agreement shall
      for any reason be held invalid, illegal or unenforceable in any respect, such
      invalidity, illegality or unenforceability shall not affect any other provision
      of this Agreement.

     

    (d) Governing
      Law.
      THIS
      AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
      GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS
      OF
      THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES
      THEREOF.

     

    
      
         

      

      
        -8-

        
          

        

      

      
         

      

    

     

    THIS
      AGREEMENT, THE CREDIT AGREEMENT AS AMENDED BY THIS AGREEMENT, THE NOTES, THE
      ISDA AGREEMENT, AND THE OTHER TRANSACTION DOCUMENTS CONSTITUTE THE ENTIRE
      UNDERSTANDING AMONG THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF
      AND SUPERSEDE ANY PRIOR AGREEMENTS, WRITTEN OR ORAL, WITH RESPECT
      THERETO.

     

    THERE
      ARE NO UNWRITTEN
      ORAL AGREEMENTS AMONG THE PARTIES.

     

    [Remainder
      of this page intentionally left blank. Signature pages to follow.]

     

    
      
         

      

      
        -9-

        
          

        

      

      
         

      

    

     

    IN
      WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
      by
      their respective officers thereunto duly authorized, as of the date first above
      written.

     

    
      	 	COMPANY
	 	 	 
	 	TEKOIL
              AND GAS
              GULF COAST, LLC
	 	 
	 	By: Tekoil & Gas
              Corporation, its Managing Member
	 
 	 
 	 
 
	 	By:  	/s/ Mark
              Western
	 	
              

              Mark
                Western

              CEO
                and Chairman of the Board of
                Directors

            

    

    
      	 	 
	 	 
	
            	GUARANTOR
	 	 	 
	 	TEKOIL
&
GAS
              CORPORATION
	 
 	 
 	 
 
	 	By:  	/s/ Mark
              Western
	 	
              

              
                Mark
                  Western

                CEO
                  and Chairman of the Board of
                  Directors

              

            

    

     

    
      	 	 	 
	 	
              J.
                ARON & COMPANY,

              as
                Lead Arranger, Syndication Agent,

              Administrative
                Agent, Lender Counterparty and a Lender

            
	 
 	 
 	 
 
	 	By:  	/s/ Susan
              Rudov
	 	
              
Authorized
              Signatory

    

     

    Signature
      Page to Amendment No. 3 and
      Waiver

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    SCHEDULE
      4.9

    

    LITIGATION

    

    Tekoil
      & Gas Corporation (“Parent”)

    

    None.

    

    Tekoil
      and Gas Gulf Coast, LLC (“Borrower”)

    

    Case
      No.
      2007-15466; Erskine
      Energy Partners II, L.P. v. Masters Resources L.L.C., Tekoil and Gas Gulf Coast,
      L.L.C., Richard H. Lee, John W. Barton, Rich Holdings L.L.C., Masters Oil &
Gas, L.L.C., and Masters Pipeline, L.L.C.;
      In the
      55th
      Judicial
      District Court of Harris County, Texas.

    

    Threatened
      Litigation

    

    In
      a
      letter dated October 9, 2007 addressed to Masters Resources, LLC, Masters Oil
      & Gas, LLC, Tekoil & Gas Corporation and Tekoil and Gas Gulf Coast, LLC,
      J-W Power Company demands payment for an alleged indebtedness of $367,209.07
      for
      unpaid invoices for equipment, services, labor and materials provided in
      connection with contracts between the aforementioned addressees. J-W Power
      Company states that if they have not received payment by October 19, 2007,
      they
      will immediately file suit for the principal amount allegedly due, together
      with
      interest, attorney’s fees and court costs.

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