Document:

EX-10.1

Exhibit 10.1

22 January 2008

ENDEAVOUR INTERNATIONAL CORPORATION

arranged by

BNP PARIBAS

and

BANK OF SCOTLAND PLC

$25,000,000

JUNIOR FACILITY AGREEMENT

Herbert Smith LLP

1

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	Clause	 	Headings	 	Page
	1.
	 	DEFINITIONS AND INTERPRETATION	 	 	1	 
	 
	 	 	 	 	 	 	 	 
	2.
	 	THE FACILITY	 	 	14	 
	 
	 	 	 	 	 	 	 	 
	3.
	 	PURPOSE	 	 	14	 
	 
	 	 	 	 	 	 	 	 
	4.
	 	CONDITIONS OF UTILISATION	 	 	15	 
	 
	 	 	 	 	 	 	 	 
	5.
	 	UTILISATION	 	 	15	 
	 
	 	 	 	 	 	 	 	 
	6.
	 	REPAYMENT	 	 	16	 
	 
	 	 	 	 	 	 	 	 
	7.
	 	PREPAYMENT AND CANCELLATION	 	 	17	 
	 
	 	 	 	 	 	 	 	 
	8.
	 	INTEREST	 	 	19	 
	 
	 	 	 	 	 	 	 	 
	9.
	 	INTEREST PERIODS	 	 	20	 
	 
	 	 	 	 	 	 	 	 
	10.
	 	CHANGES TO THE CALCULATION OF INTEREST	 	 	21	 
	 
	 	 	 	 	 	 	 	 
	11.
	 	FEES	 	 	23	 
	 
	 	 	 	 	 	 	 	 
	12.
	 	TAX GROSS UPAND INDEMNITIES	 	 	24	 
	 
	 	 	 	 	 	 	 	 
	13.
	 	INCREASED COSTS	 	 	30	 
	 
	 	 	 	 	 	 	 	 
	14.
	 	OTHER INDEMNITIES	 	 	31	 
	 
	 	 	 	 	 	 	 	 
	15.
	 	MITIGATION BY THE LENDERS	 	 	32	 
	 
	 	 	 	 	 	 	 	 
	16.
	 	COSTS AND EXPENSES	 	 	33	 
	 
	 	 	 	 	 	 	 	 
	17.
	 	GUARANTEE AND INDEMNITY	 	 	33	 
	 
	 	 	 	 	 	 	 	 
	18.
	 	CASH SWEEPAND EXPENDITURE CONTROLS	 	 	38	 
	 
	 	 	 	 	 	 	 	 
	19.
	 	REPRESENTATIONS	 	 	39	 
	 
	 	 	 	 	 	 	 	 
	20.
	 	INFORMATION UNDERTAKINGS	 	 	46	 
	 
	 	 	 	 	 	 	 	 
	21.
	 	GENERAL UNDERTAKINGS	 	 	51	 
	 
	 	 	 	 	 	 	 	 
	22.
	 	FINANCIAL COVENANTS	 	 	63	 
	 
	 	 	 	 	 	 	 	 
	23.
	 	EVENTS OF DEFAULT	 	 	67	 
	 
	 	 	 	 	 	 	 	 
	24.
	 	CHANGES TO THE LENDERS	 	 	73	 
	 
	 	 	 	 	 	 	 	 
	25.
	 	CHANGES TO THE OBLIGORS	 	 	77	 
	 
	 	 	 	 	 	 	 	 
	26.
	 	ROLE OF THE ADMINISTRATIVE FINANCE PARTIES	 	 	80	 
	 
	 	 	 	 	 	 	 	 
	27.
	 	CONDUCT OF BUSINESS BY THE FINANCE PARTIES	 	 	86	 
	 
	 	 	 	 	 	 	 	 
	28.
	 	SHARING AMONG THE FINANCE PARTIES	 	 	86	 
	 
	 	 	 	 	 	 	 	 
	29.
	 	PAYMENT MECHANICS	 	 	89	 
	 
	 	 	 	 	 	 	 	 
	30.
	 	SET-OFF	 	 	91	 
	 
	 	 	 	 	 	 	 	 
	31.
	 	NOTICES	 	 	92	 
	 
	 	 	 	 	 	 	 	 
	32.
	 	CALCULATIONS AND CERTIFICATES	 	 	93	 
	 
	 	 	 	 	 	 	 	 
	33.
	 	PARTIAL INVALIDITY	 	 	94	 
	 
	 	 	 	 	 	 	 	 
	34.
	 	REMEDIES AND WAIVERS	 	 	94	 
	 
	 	 	 	 	 	 	 	 
	35.
	 	AMENDMENTS AND WAIVERS	 	 	94	 
	 
	 	 	 	 	 	 	 	 
	36.
	 	COUNTERPARTS	 	 	95	 
	 
	 	 	 	 	 	 	 	 
	37.
	 	GOVERNING LAW	 	 	96	 
	 
	 	 	 	 	 	 	 	 
	38.
	 	ENFORCEMENT	 	 	96	 
	 
	 	 	 	 	 	 	 	 

2

THIS AGREEMENT is dated 22 January 2008

BETWEEN:

	(1)	 	ENDEAVOUR INTERNATIONAL CORPORATION (a corporation incorporated under the laws of the State
of Nevada whose principal place of business is 1000 Main Street, Suite 3300, Houston, Texas,
77002, USA) (the “Company");

	(2)	 	THE AFFILIATE of the Company listed in Part I (The Original Borrower) of Schedule 1 (The
Original Obligors) as original borrower (the “Original Borrower");

	(3)	 	THE AFFILIATES of the Company listed in Part II (The Original Guarantors) of Schedule 1 (The
Original Obligors) as original guarantors (together with the Company, the “Original
Guarantors");

	(4)	 	BNP PARIBAS and BANK OF SCOTLAND PLC (together, the “Mandated Lead Arrangers");

	(5)	 	THE FINANCIAL INSTITUTIONS whose names appear in the first row of the table set out in
Schedule 2 (The Original Lenders) (the “Original Lenders"); and

	(6)	 	BNP PARIBAS as Agent and Security Trustee.

IT IS AGREED as follows:

	1.	 	DEFINITIONS AND INTERPRETATION

	1.1	 	Definitions

In this Agreement:

“Abandonment Date” means, in relation to each Borrowing Base Asset, the date on which it is
assumed that production of Petroleum from that Borrowing Base Asset will no longer be
commercially viable and the operation of such Borrowing Base Asset will cease for economic
reasons.

“Accession Letter” means a document substantially in the form set out in Schedule 7 (Form
of Accession Letter).

“Acquisition Agreement” means the Agreement dated 26th May 2006 between Paladin Resources
Limited (1) Endeavour Energy UK Limited (2) and Endeavour International Corporation (3)
granting put and call options over the entire issued share capital of Talisman Expro
Limited.

“Additional Borrower” means a company which becomes an Additional Borrower in accordance
with Clause 25 (Changes to the Obligors).

“Additional Cost Rate” has the meaning given to it in Schedule 5 (Mandatory Cost formulae).

“Additional Guarantor” means a company which becomes an Additional Guarantor in accordance
with Clause 25 (Changes to the Obligors).

“Additional Obligor” means an Additional Borrower or an Additional Guarantor.

“Administrative Finance Parties” means each of the Mandated Lead Arrangers, the Agent and
the Security Trustee.

“Affiliate” means, in relation to any person, a Subsidiary of that person or a Holding
Company of that person or any other Subsidiary of that Holding Company.

“Agent” means BNP Paribas in its capacity as agent for the other Finance Parties or any
other person that replaces it in such capacity in accordance with this Agreement.

“Aggregate Commitments” means the sum of the Lenders’ Commitments.

“Authorisation” means an authorisation, consent, approval, resolution, licence, exemption,
filing, notarisation or registration.

“Availability Period” means the period from and including the date of this Agreement to and
including the date falling one month after the Effective Date.

“Available Commitment” means a Lender’s Commitment minus:

	 	(A)	 	the amount of its participation in any outstanding Loans; and

	 	(B)	 	in relation to any proposed Loan, the amount of its participation in any
Loans that are due to be made on or before the proposed Utilisation Date.

“Borrower” means the Original Borrower or an Additional Borrower.

“Borrower Group” means Endeavour International Holding and its Subsidiaries for the time
being other than any Non-Recourse Subsidiary.

“Borrowing Base Asset” has the meaning given in the First Lien Credit Agreement.

“Break Costs” means the amount (if any) by which:

	 	(A)	 	the interest which a Lender should have received for the period from the date
of receipt of all or any part of its participation in a Loan or Unpaid Sum to the last
day of the current Interest Period in respect of that Loan or Unpaid Sum, had the
principal amount or Unpaid Sum received been paid on the last day of that Interest
Period;

exceeds:

	 	(B)	 	the amount which that Lender would be able to obtain by placing an amount
equal to the principal amount or Unpaid Sum received by it on deposit with a leading
bank in the London interbank market for a period starting on the Business Day
following receipt or recovery and ending on the last day of the current Interest
Period.

“Business Day” means a day (other than a Saturday or Sunday or bank holiday) on which banks
are open for general business in London, Paris and New York City.

“Commitment” means:

	 	(A)	 	in relation to each Original Lender the amount set opposite its name under
the heading “Commitment” and the amount of any other Commitment transferred to it
under this Agreement; and

	 	(B)	 	in relation to any other Lender, the amount of any Commitment transferred to
it under this Agreement,

in each case, to the extent not cancelled, reduced or transferred by it under this
Agreement.

“Confidentiality Undertaking” means a confidentiality undertaking substantially in a form
from time to time recommended by the LMA or in any other form agreed between the Company
and the Agent.

“Conversion Date” means the date falling 365 days after the Effective Date.

“Default” means Event of Default or Potential Event of Default.

“Disruption Event” means either or both of:

	 	(A)	 	a material disruption to those payment or communications systems or to those
financial markets which are, in each case, required to operate in order for payments
to be made in connection with the Facility (or otherwise in order for the transactions
contemplated by the Finance Documents to be carried out) which disruption is not
caused by, and is beyond the control of, any of the Parties; or

	 	(B)	 	the occurrence of any other event which results in a disruption (of a
technical or systems-related nature) to the treasury or payments operations of a Party
preventing that, or any other Party;

	 	(i)	 	from performing its payment obligations under the Finance
Documents; or

	 	(ii)	 	from communicating with other Parties in accordance with
the terms of the Finance Documents,

(and which (in either such case)) is not caused by, and is beyond the control of,
the Party whose operations are disrupted.

“Due Diligence Report” means the due diligence report from Ashurst referred to in, and
delivered to the finance parties under the First Lien Credit Agreement pursuant to, the
First Lien Credit Agreement.

“Dutch Borrower” means any Borrower which is incorporated in The Netherlands.

“Dutch Obligor” means any Obligor which is incorporated in The Netherlands.

“Effective Date” means the date on which the Agent issues a notice to the Company and the
Lenders under Clause 4.1 (Initial conditions precedent).

“Endeavour International Holding” means Endeavour International Holding B.V., a private
company with limited liability (besloten vennootschap met beperkte aansprakelijkheid)
incorporated in The Netherlands having its corporate seat at Amsterdam, The Netherlands and
its registered address at Teleportboulevard 140, 1043 EJ, Amsterdam, The Netherlands.

“Endeavour North Sea” means Endeavour North Sea Limited (formerly, Talisman Expro Limited),
a company incorporated in England and Wales (Registered No. 03518803).

“Environmental Claims” means any claim by any person in connection with (i) a breach, or
alleged breach, of an Environmental Law; (ii) any accident, fire, explosion or other event
of any type involving an emission or substance which is capable of causing harm to any
living organism or the environment; or (iii) any other environmental contamination.

“Environmental Laws” means any law or regulation concerning (i) the protection of health
and safety; (ii) the environment; or (iii) any emission or substance which is capable of
causing harm to any living organism or the environment.

“Environmental Licence” means all Authorisations required by any Environmental Law for the
ownership of an interest in, or the operation or development of, any Petroleum Asset.

“Equivalent Field Document” means, to the extent that any member of the Group is permitted
to enter into the same under the Finance Documents, in relation to any Petroleum Asset that
is not a Borrowing Base Asset:

	 	(A)	 	each joint operating agreement and/or unitisation and unit operating
agreement relating thereto, each agreement relating to the transportation, processing
and/or storage of production therefrom and each agreement for the sale or marketing of
production therefrom and each other major agreement relating to that Petroleum Asset
and/or Petroleum produced therefrom;

	 	(B)	 	any Authorisation required for the lawful exploitation, development or
operation of that Petroleum Asset or the production, transportation or sale of
Petroleum therefrom (and including, without limitation, any Petroleum production
licence);

	 	(C)	 	any development plan approved by any relevant operating committee and/or any
appropriate governmental or other regulatory authority relating to that Petroleum
Asset;

	 	(D)	 	any documents relating to the acquisition by any member of the Group of any
interests in that Petroleum Asset or of any entity holding the interest in that
Petroleum Asset; and

	 	(E)	 	any other document designated as such by the Company and the Agent.

“Event of Default” means any event or circumstance specified as such in Clause 23 (Events
of Default).

“Existing Second Lien Facility” means the second lien credit and guarantee agreement dated
31 October 2006 between, amongst others, Endeavour International Holding, the Guarantors as
defined therein and Credit Suisse.

“Facility” means the term loan credit facility described in Clause 2.1 (Facility).

“Facility Office” means the office or offices notified by a Lender to the Agent in writing
on or before the date it becomes a Lender (or, following that date, by not less than five
Business Days’ written notice) as the office or offices through which it will perform its
obligations under this Agreement.

“Fee Letter” means each of:

	 	(A)	 	any letter dated on or about the date of this Agreement between (i) all or
any of the Obligors and (ii) all or any of the Administrative Finance Parties relating
to the payment of fees by the Obligors (or any of them) to any such Administrative
Finance Party(ies); and

(B) any other letter designated as such by the Agent and the Company.

“Final Maturity Date” means 20 October 2011.

“Finance Document” means:

(A) this Agreement;

(B) any Security Document;

(C) any Fee Letter;

	 	 	 
	(D)

(E)

(F)

(G)

(I)

	 	any Transfer Certificate;

any Accession Letter;

any other Accession Instrument;

the Intercreditor Agreement; and

any other document designated as such by the Company and the Agent.

“Finance Party” means each of the Lenders, the Mandated Lead Arrangers, the Security
Trustee and the Agent.

“Financial Indebtedness” means, at the relevant date, any indebtedness for or in respect
of:

	 	(A)	 	moneys borrowed;

	 	(B)	 	any acceptance credit;

	 	(C)	 	any bond, note, debenture, loan stock, or other similar instrument;

	 	(D)	 	any redeemable preference share;

	 	(E)	 	any finance or capital lease;

(F) receivables sold or discounted (otherwise than on a non-recourse basis);

	 	(G)	 	the acquisition cost of any asset to the extent payable after its acquisition
or possession by the party liable where the deferred payment is arranged primarily as
a method of raising finance or financing the acquisition of that asset;

	 	(H)	 	any derivative transaction protecting against or benefiting from fluctuations
in any rate or price (and, except for non-payment of an amount, the then mark to
market value of the derivative transaction will be used to calculate its amount);

	 	(I)	 	any other transaction (including any forward sale or purchase agreement)
which has the commercial effect of a borrowing;

	 	(J)	 	any counter-indemnity obligation in respect of any guarantee, indemnity,
bond, letter of credit or any other instrument issued by a bank or financial
institution; or

	 	(K)	 	any guarantee, indemnity or similar assurance against financial loss of any
person in respect of any item referred to in paragraphs (A) to (J) above,

but excluding, for the avoidance of doubt, any indebtedness arising from the purchase of
goods or services on normal credit terms in the ordinary course of business.

“GAAP/IFRS” means:

	 	(A)	 	in relation to any member of the Group incorporated in the UK, generally
accepted accounting principles in the UK; or

	 	(B)	 	in relation to any member of the Group that is not incorporated in the UK,
generally accepted accounting principles in that person’s jurisdiction of
incorporation,

or, in each case, if IFRS has been implemented by the Group or the relevant member thereof,
IFRS.

“Group” means Endeavour International Corporation and its Subsidiaries for the time being
other than any Non-Recourse Subsidiary.

“Guarantor” means an Original Guarantor or an Additional Guarantor.

“Holding Company” means, in relation to a company or corporation, any other company or
corporation in respect of which it is a Subsidiary.

“IFRS” means the International Financial Reporting Standards, International Accounting
Standards and interpretations of those standards issued by the International Accounting
Standards Board and the International Financial Reporting Interpretations Committee and
their predecessor bodies.

“Information Package” means the written information and documents delivered to the Mandated
Lead Arrangers by any Obligor in connection with the negotiation of this Agreement on or
before the date of this Agreement.

“Insolvency Officer” means any liquidator, trustee in bankruptcy, judicial custodian or
manager, compulsory manager, receiver, administrative receiver, administrator, curator,
bewindvoerder, vereffenaar or similar officer, in each case, appointed in any relevant
jurisdiction.

“Insurances” means any insurances that are required to be maintained by, or on behalf of,
any Obligor or any member of the Group in respect of the Borrowing Base Assets and/or any
activities related thereto pursuant to this Agreement.

“Intercreditor Agreement” means the agreement dated 31 October 2006 between, among others,
the Company, the Obligors as defined therein and the Finance Parties as amended and
restated pursuant to an amendment and restatement agreement dated on or about the date
hereof.

“Interest Period” means, in relation to a Loan, each period determined in accordance with
Clause 9 (Interest Periods) and, in relation to an Unpaid Sum, each period determined in
accordance with Clause 8.3 (Default interest).

“ITA” means the Income Tax Act 2007.

“Lender” means:

(A) any Original Lender; and

	 	(B)	 	any bank, financial institution, trust, fund or other entity which has become
a Party in accordance with Clause 24 (Changes to the Lenders),

which in each case has not ceased to be a Party in accordance with the terms of this
Agreement.

“LIBOR” means, in relation to any Loan:

(A) the applicable Screen Rate; or

	 	(B)	 	(if no Screen Rate is available for dollars for the Interest Period of that
Loan) the arithmetic mean of the rates (rounded upwards to four decimal places) as
supplied to the Agent at its request quoted by the Reference Banks to leading banks in
the London interbank market,

as of 11.00 a.m. (London time) on the Quotation Day for the offering of deposits in dollars
and for a period comparable to the Interest Period for that Loan.

“LMA” means the Loan Market Association.

“Loan” means a loan made or to be made under the Facility or the principal amount
outstanding for the time being of that loan.

“Majority Lenders” means:

	 	(A)	 	if there are no Loans then outstanding, a Lender or Lenders whose Commitments
aggregate 66?% or more of the Aggregate Commitments (or, if the Aggregate Commitments
have been reduced to zero, aggregated 66?% or more of the Aggregate Commitments
immediately prior to the reduction); or

	 	(B)	 	at any other time, a Lender or Lenders whose participations in the Loans then
outstanding aggregate 66?% or more of all the Loans then outstanding.

“Mandatory Cost” means the percentage rate per annum calculated by the Agent in accordance
with Schedule 5 (Mandatory Cost Formulae).

“Margin” means:

	 	(A)	 	3.50 per cent. per annum; and

	 	(B)	 	on and from the Conversion Date, 5.50 per cent. per annum.

“Material Adverse Change” means any event, development or circumstance that has a material
adverse effect on:

	 	(A)	 	the ability of any Obligor to perform any of its payment obligations under
any Finance Document as and when they fall due to be performed;

	 	(B)	 	the business, property, operations or financial condition of the Obligors
(taken as a whole);

	 	(C)	 	the validity or enforceability of any provision of any Finance Document;

	 	(D)	 	the rights and remedies of any Finance Party under any Finance Document; or

	 	(E)	 	the validity, enforceability, effectiveness or priority of any Security
created or purported to be created under the Finance Documents.

“Material Subsidiary” means each member of the Group whose:

	 	(A)	 	profits (calculated before making allowances for Taxes) represent more than
10% of the aggregate profits of the Group (calculated before making allowances for
Taxes) as shown by the latest audited consolidated accounts for the time being of the
Company as adjusted in such manner as the Agent and the Company may agree (each acting
reasonably) to be appropriate from time to time to take account of any matters
occurring after the relevant balance sheet date; or

	 	(B)	 	fixed assets (other than intangible assets) have a book value which
represents more than 10% of the book value of the consolidated fixed assets (other
than intangible assets) of the Group as shown by the latest audited consolidated
accounts for the time being of the Company as adjusted in such manner as the Agent and
the Company may agree (each acting reasonably) to be appropriate from time to time to
take account of any matters occurring after the relevant balance sheet date.

“Month” means a period starting on one day in a calendar month and ending on the
numerically corresponding day in the next calendar month, except that:

	 	(A)	 	(subject to paragraph (C) below) if the numerically corresponding day is not
a Business Day, that period shall end on the next Business Day in that calendar month
in which that period is to end if there is one, or if there is not, on the immediately
preceding Business Day;

	 	(B)	 	if there is no numerically corresponding day in the calendar month in which
that period is to end, that period shall end on the last Business Day in that calendar
month; and

	 	(C)	 	if an Interest Period begins on the last Business Day of a calendar month,
that Interest Period shall end on the last Business Day in the calendar month in which
that Interest Period is to end.

	 	 	 	The above rules will only apply to the last Month of any period.

	 	 	 	“Non Recourse Subsidiary” means any Subsidiary of the Company which:

	 	(A)	 	does not own directly or indirectly (by shareholding or otherwise) an
interest in any Borrowing Base Asset; and

	 	(B)	 	which has been nominated as a “Non-Recourse Subsidiary” by the Company by
written notice to the Agent.

	 	 	 	“Obligor” means a Borrower or a Guarantor.

	 	 	 	“Original Financial Statements” means:

	 	(A)	 	in relation to the Company, the audited consolidated financial statements of
the Company for the financial year ended 31 December 2006; and

	 	(B)	 	in relation to each of the other Original Obligors, its financial statements
or, if the same have been audited, audited financial statements for its financial year
ended 31 December 2006.

	 	 	 	“Original Obligor” means the Original Borrower or an Original Guarantor.

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

	 	 	 	“Party” means a party to this Agreement.

	 	 	 	“Permitted Expenditure” has the meaning given in the First Lien Credit Agreement.

	 	 	 	“Permitted Transaction” means:

	 	(A)	 	an intra-group re-organisation on a solvent basis

	 	(B)	 	the transfer of any Borrowing Base Asset owned by Endeavour North Sea to
Endeavour Energy UK Limited, on terms (i) whereby such asset remains a Borrowing Base
Asset and (ii) that ensure that the Security Trustee continues to have Security over
such Borrowing Base Asset upon the same, or more beneficial, terms as the Security
granted in favour of the Security Trustee over such Borrowing Base Asset before such
transfer and that the Security that the Security Trustee has over such Borrowing Base
Asset is not prejudiced or adversely affected in any way;

	 	(C)	 	the winding-up of Endeavour North Sea on a solvent basis at a time when it
has no assets whatsoever and is not a Borrower or Guarantor; or

	 	(B)	 	any other transaction agreed by the Majority Lenders.

“Petroleum” means any mineral, oil or relative hydrocarbon (including condensate and
natural gas liquids) and natural gas existing in its natural condition in strata (but not
including coal or bituminous shale or other stratified deposits from which oil can be
extracted by destructive distillation).

“Petroleum Asset” means (i) any Petroleum field, pipeline transmission system or other
Petroleum project, (ii) the facilities relating to such field, system or project and/or
(iii) the interests in such field, system, project or facilities.

“Potential Event of Default” means any event or circumstances specified in Clause 23
(Events of Default) which would (with the expiry of a grace period, the giving of notice,
the fulfilment of any condition, the making of any determination under the Finance
Documents or any combination of the foregoing) be an Event of Default.

	 	 	 	“Proceeds Accounts” has the meaning given in the First Lien Credit Agreement.

	 	 	 	“Project Accounts” has the meaning given in the First Lien Credit Agreement.

	 	 	 	“Project Documents” means:

	 	(A)	 	in relation to each Borrowing Base Asset:

	 	(1)	 	each joint operating agreement and/or unitisation and unit
operating agreement relating thereto, each agreement relating to the
development thereof or the transportation, processing and/or storage of
production therefrom and each agreement for the sale or marketing of
production therefrom and each other major agreement relating to that
Borrowing Base Asset and/or Petroleum produced therefrom;

	 	(2)	 	any Authorisation required for the lawful exploitation,
development or operation of that Borrowing Base Asset or the production,
transportation or sale of Petroleum therefrom (and including, without
limitation, any Petroleum production licence);

	 	(3)	 	any development plan approved by any relevant operating
committee and/or any appropriate governmental or other regulatory authority
relating to that Borrowing Base Asset;

	 	(B)	 	any documents relating to the acquisition by any member of the Borrower Group
of any interests in any Borrowing Base Asset or of any entity holding the interest in
such Borrowing Base Asset; and

	 	(C)	 	any other document designated as such by the Company and the Agent.

	 	 	 	“Projection” has the meaning given in the First Lien Credit Agreement.

“Qualifying Lender” has the meaning given to it in Clause 12 (Tax gross up and
indemnities).

“Quotation Day” means, in relation to any period for which an interest rate is to be
determined, two Business Days before the first day of that period, unless market practice
differs in the London interbank market in which case the Quotation Day will be determined
by the Agent in accordance with market practice in the London interbank market and if
quotations would normally be given by leading banks in the London interbank market on more
than one day, the Quotation Day will be the last of those days.

“Reduction Date” means each date set out in the column marked “Date” in the table set out
in Clause 6.2 (Repayment of Loans).

“Reference Banks” means the principal London offices of BNP Paribas, Bank of Scotland plc
or such other banks as may be appointed by the Agent in consultation with the Company.

“Relevant Affiliate” means, to the extent that it is not already an Obligor, any
wholly-owned Subsidiary of the Company.

“Repeating Representations” means each of the representations set out in Clause 19
(Representations) other than those in Clauses 19.6 (Pari passu ranking), 19.7 (Insolvency),
19.9 (Authorisations), 19.10 (Financial statements), 19.11 (No Material Adverse Change),
19.12 (Litigation), 19.13 (Information Package), 19.15 (Environmental matters), 19.18 (Laws
and regulations), 19.19 (Insurances), 19.22 (Deduction of Tax), 19.23 (Ownership structure)
and 19.25 (Share Security).

“Screen Rate” means the British Bankers’ Association Interest Settlement Rate for the
relevant period displayed on the appropriate page of the Telerate screen. If the agreed
page is replaced or service ceases to be available, the Agent may specify another page or
service displaying the appropriate rate after consultation with the Company and the
Lenders.

“Security” means a mortgage, charge, pledge, lien or other security interest securing any
obligation of any person or any other agreement or arrangement having a similar effect.

“Selection Notice” means a notice substantially in the form set out in Part II (Selection
Notice) of Schedule 4 (Requests) given in accordance with Clause 9 (Interest Periods).

“Senior Finance Documents” means the Finance Documents (as defined in the First Lien Credit
Agreement).

“Subsidiary” means a subsidiary undertaking within the meaning of section 258 of the
Companies Act 1985.

“Tax” means any tax, levy, impost, duty or other charge or withholding of a similar nature
(including any penalty or interest payable in connection with any failure to pay or any
delay in paying any of the same).

“Taxes Act” means the Income and Corporation Taxes Act 1988.

“Total Available Commitments” means the aggregate for the time being of all the Lenders’
Available Commitment.

“Transaction Documents” means the Project Documents and the Finance Documents.

“Transaction Party” means each Obligor and each other party (not being a Finance Party) who
is party to any Finance Document.

“Transfer Certificate” means a certificate substantially in the form set out in Schedule 6
(Form of Transfer Certificate) or any other form agreed between the Agent and the Company.

	 	 	 	“Transfer Date” means, in relation to a transfer, the later of:

	 	(A)	 	the proposed Transfer Date specified in the Transfer Certificate; and

	 	(B)	 	the date on which the Agent executes the Transfer Certificate.

“Unpaid Sum” means any sum due and payable but unpaid by an Obligor under the Finance
Documents.

“Utilisation Date” means, in relation to any Loan, the date on which the Loan is made.

“Utilisation Request” means a notice substantially in the form set out in Part I
(Utilisation Request) of Schedule 4 (Requests).

“VAT” means value added tax as provided for in the Value Added Tax Act 1994 and any other
tax of a similar nature.

	 	 	 	 	 	 	 
	1.2	 	Construction
	
 
	 	 	1.2.1	 	 	Unless a contrary indication appears, any reference in this Agreement to:

	 	(A)	 	any Finance Party or any Obligor or Transaction Party shall
be construed so as to include its successors in title, permitted assigns and
permitted transferees;

	 	(B)	 	“assets” includes present and future properties, revenues
and rights of every description;

	 	(C)	 	any form of asset shall include a reference to all or any
part of that asset;

	 	(D)	 	a “Finance Document” or any other agreement or instrument
is a reference to that Finance Document or other agreement or instrument as
modified (however fundamentally and whether or not more onerously) and
includes any change in the purpose of, any extension of or increase in any
facility or addition of any new facility under that Finance Document or other
agreement or instrument;

	 	(E)	 	“indebtedness” includes any obligation (whether incurred as
principal or as surety) for the payment or repayment of money, whether
present or future, actual or contingent;

	 	(F)	 	a “person” includes any individual, firm, company,
corporation, government, state or agency of a state or any association,
trust, joint venture, consortium or partnership (whether or not having
separate legal personality) or two or more of the foregoing;

	 	(G)	 	a “regulation” includes any regulation, rule, official
directive, request or guideline (whether or not having the force of law but,
if not having the force of law, being of a kind that is normally complied
with by those to whom it is addressed) of any governmental, intergovernmental
or supranational body, agency, department or regulatory, self-regulatory or
other authority or organisation;

	 	(H)	 	“disposal” means a sale, transfer, grant, lease or other
disposal, whether voluntary or involuntary (and shall include any
unitisation), and “dispose” will be construed accordingly;

	 	(I)	 	a “guarantee” includes any form of indemnity or other
assurance against financial loss (including any obligation to pay, purchase
or provide funds for the purchase of any liability), and the verb “to
guarantee” shall be construed accordingly;

	 	(J)	 	a provision of law is a reference to that provision as
amended or re-enacted;

	 	(K)	 	a time of day is a reference to London time;

	 	(L)	 	any matter “including” specific instances or examples of
such matter shall be construed without limitation to the generality of that
matter (and references to “include” shall be construed accordingly);

	 	(M)	 	a “modification” includes an amendment, supplement,
novation, re-enactment, restatement, variation, extension, replacement,
modification or waiver or the giving of any waiver, release, consent having
the same commercial effect of any of the foregoing (and “modify” shall be
construed accordingly);

	 	(N)	 	an amount in one currency that is “equivalent” to an amount
in another currency shall be construed as meaning the amount of the second
currency that can be obtained by converting the amount in the first currency
into the second currency at the Agent’s spot rate of exchange for conversions
between those two currencies at the relevant time;

	 	(O)	 	the “winding-up", “dissolution” or “administration” of a
person shall be construed so as to include any equivalent or analogous
proceedings under the law of the jurisdiction in which such person is
incorporated or established, or any jurisdiction in which such person carries
on business including the seeking of liquidation, winding-up, reorganisation,
dissolution, administration, arrangement, adjustment, protection or relief of
debtors; and

	 	(P)	 	“$” or “dollars” is to the lawful currency for the time
being of the United States of America.

	 	1.2.2	 	Clause and Schedule headings are for ease of reference only.

	 	1.2.3	 	The words “other", “or otherwise” and “whatsoever” shall not be construed
ejusdem generis or be construed as any limitation upon the generality of any preceding
words or matters specifically referred to.

	 	1.2.4	 	Unless a contrary indication appears, a term used in any other Finance
Document or in any notice given under or in connection with any Finance Document has
the same meaning in that Finance Document or notice as in this Agreement. Unless
otherwise defined in this Agreement or unless the contrary is expressly specified in
this Agreement, terms defined in the Intercreditor Agreement shall have the same
meaning when used in this Agreement.

	 	1.2.5	 	A Potential Event of Default is “continuing” if it has not been remedied or
waived. An Event of Default is “continuing” if it has not been waived.

	 	1.2.6	 	Unless a contrary intention appears, the obligation(s) of each Obligor and
Transaction Party under this Agreement and/or the other Finance Documents shall remain
in force for as long as any amount is or may be outstanding under the Finance
Documents or any Commitment is in force.

	 	1.2.7	 	If a moratorium (or other similar event in any jurisdiction) occurs in
respect of an Obligor, the ending of that moratorium (or other such similar event)
will not remedy any Event of Default caused by the moratorium (or other such similar
event) and, notwithstanding any other term of the Finance Documents, that Event of
Default will continue to be outstanding unless and until it is expressly waived by the
Agent (acting on the instructions of the Majority Lenders).

	1.3	 	Third party rights

	 	1.3.1	 	Unless expressly provided to the contrary in a Finance Document, a person
who is not a Party has no right under the Contracts (Rights of Third Parties) Act 1999
(the “Third Parties Act") to enforce or to enjoy the benefit of any term of this
Agreement.

	 	1.3.2	 	Notwithstanding any term of any Finance Document, the consent of any person
who is not a Party is not required to rescind or vary this Agreement at any time.

	2.	 	THE FACILITY

	2.1	 	Facility

Subject to the terms of this Agreement, the Lenders make available to the Borrowers a
dollar term credit facility in an aggregate amount equal to the Aggregate Commitments.

	2.2	 	Finance Parties’ rights and obligations

	 	2.2.1	 	The obligations of each Finance Party under the Finance Documents are
several. Failure by a Finance Party to perform its obligations under the Finance
Documents does not affect the obligations of any other Party under the Finance
Documents. No Finance Party is responsible for the obligations of any other Finance
Party under the Finance Documents.

	 	2.2.2	 	The rights of each Finance Party under or in connection with the Finance
Documents are separate and independent rights and any debt arising under the Finance
Documents to a Finance Party from an Obligor shall be a separate and independent debt.

	 	2.2.3	 	A Finance Party may, except as otherwise stated in the Finance Documents,
separately enforce its rights under the Finance Documents.

	3.	 	PURPOSE

	3.1	 	Purpose

Each Borrower shall apply the proceeds of the Loans borrowed by it under the Facility in or
towards:

	 	3.1.1	 	the repayment and discharge of the Financial Indebtedness arising under the
Existing Second Lien Facility;

	 	3.1.2	 	the payment of the transaction costs relating to this Facility and its
implementation.

	3.2	 	Monitoring

No Finance Party is bound to monitor or verify the application of any amount borrowed
pursuant to this Agreement.

	4.	 	CONDITIONS OF UTILISATION

	4.1	 	Initial conditions precedent

The Lenders will only be obliged to comply with Clause 5.4 (Lenders’ participation) if the
Agent has received all of the documents and other evidence listed in Part I (CPs to first
Loan) of Schedule 3 (Conditions precedent) in form and substance satisfactory to the Agent.
The Agent shall notify the Company and the Lenders promptly upon being so satisfied.

	4.2	 	Further conditions precedent

The Lenders will only be obliged to comply with Clause 5.4 (Lenders’ participation) if on
the date of the Utilisation Request and on the proposed Utilisation Date:

	 	4.2.1	 	no Default is continuing or would result from the proposed Loan; and

	 	4.2.2	 	the Repeating Representations to be made by each Obligor are true in all
material respects.

	 	 	 	 	 	 	 
	4.3	 	Maximum number of Loans
	
 
	 	 	4.3.1	 	 	The Borrowers may not deliver more than one Utilisation Request.

	 	4.3.2	 	A Borrower may not request that a Loan be divided if, as a result of the
proposed division, five or more Loans would be outstanding.

	5.	 	UTILISATION

	5.1	 	Delivery of a Utilisation Request

A Borrower may request a Loan to be made by delivery to the Agent of a duly completed
Utilisation Request not later than 10.00 a.m. on the second Business Day prior to the
proposed Utilisation Date (or such later date as the Lenders may agree).

	5.2	 	Completion of a Utilisation Request

	 	5.2.1	 	Each Utilisation Request is irrevocable and will not be regarded as having
been duly completed unless:

	 	(A)	 	the proposed Utilisation Date is a Business Day within the
Availability Period;

	 	(B)	 	the currency and amount of the Loan comply with Clause 5.3
(Currency and amount);

	 	(C)	 	the proposed Interest Period complies with Clause 9
(Interest Periods); and

	 	(D)	 	it has been duly signed by an authorised signatory of the
relevant Borrower.

	 	 	 	 	 	 	 
	
 
	 	 	5.2.2	 	 	Only one Loan may be requested in each Utilisation Request.
	5.3	 	Currency and amount
	
 
	 	 	5.3.1	 	 	The currency specified in a Utilisation Request must be dollars.

	 	5.3.2	 	The amount of the proposed Loan must be a minimum of US$5,000,000 or, if
less, the Total Available Commitments.

	5.4	 	Lenders’ participation

	 	5.4.1	 	If the conditions set out in this Agreement have been met, each Lender shall
make its participation in each Loan available by the Utilisation Date through its
Facility Office.

	 	5.4.2	 	The amount of each Lender’s participation in each Loan will be equal to the
proportion borne by its Available Commitment to the Total Available Commitments
immediately prior to making the Loan.

	 	5.4.3	 	The Agent shall notify each Lender of the amount of each Loan and the amount
of its participation in that Loan not later than 5.00 p.m. on the third Business Day
prior to the Utilisation Date for such Loan.

	5.5	 	Cancellation of Commitment

The Aggregate Commitments shall be immediately cancelled at the end of the Availability
Period.

	6.	 	REPAYMENT

	 	 	 
	6.1	 	Reduction of Facility
	6.2

	 	The Aggregate Commitments shall reduce to zero on the Final Maturity Date.

Repayment of Loans

Without prejudice to Clause 18 (Cash sweep and expenditure controls), on each date set out
in the column marked “Date” in the table below, the Borrowers shall repay the Loans so that
following such repayment, the aggregate amount of the Loans outstanding under the Facility
does not exceed the amount set out in the column marked “Amount” in the table below.

	 	 	 	 	 	 	 	 	 
	 	 	Date	 	Amount
	 
	 	31 December 2009	 	$	20,000,000	 
	 
	 	30 June 2010	 	$	15,000,000	 
	 
	 	31 December 2010	 	$	10,000,000	 
	 
	 	30 June 2011	 	$	5,000,000	 
	 
	 	Final Maturity Date	 	 	0	 
	6.3
	 	Reborrowing	 	 	 	 

No Borrower may reborrow any part of the Facility which is prepaid or repaid.

	7.	 	PREPAYMENT AND CANCELLATION

	7.1	 	Illegality

If it becomes unlawful in any applicable jurisdiction for a Lender to perform any of its
obligations as contemplated by this Agreement or to fund or maintain its participation in
any Loan:

	 	7.1.1	 	that Lender shall promptly notify the Agent upon becoming aware of that
event;

	 	7.1.2	 	upon the Agent notifying the Company, the Commitment of that Lender will be
immediately cancelled; and

	 	7.1.3	 	each Borrower shall repay that Lender’s participation in the Loans made to
that Borrower on the last day of the Interest Period for each Loan occurring after the
Agent has notified the Company or, if earlier, the date specified by the Lender in the
notice delivered to the Agent (being no earlier than the last day of any applicable
grace period permitted by law).

	 	 	 	 	 	 	 
	7.2	 	Change of control
	
 
	 	 	7.2.1	 	 	If any person or group of persons acting in concert gains control of an Obligor:

	 	(A)	 	the Company shall promptly notify the Agent upon becoming
aware of that event;

	 	(B)	 	if the Majority Lenders so require, the Agent shall, by not
less than fifteen Business Days notice to the Company, cancel the Facility
and declare all outstanding Loans, together with accrued interest, and all
other amounts accrued under the Finance Documents immediately due and
payable.

	 	7.2.2	 	For the purposes of Clause 7.2.1, “control” has the meaning given to such
term in Section 416 of the Income and Corporation Taxes Act 1988 (whether or not that
Act applies to any Obligor).

	 	7.2.3	 	For the purposes of Clause 7.2.1, “acting in concert” has the meaning given
to such term in the City Code on Takeovers and Mergers and the presumptions specified
therein in relation to the term “acting in concert” shall apply to such term as used
in this Agreement (whether or not that code applies to any Obligor).

	7.3	 	Mandatory prepayment

	 	7.3.1	 	If any member of the Group disposes of any of its interests in any Petroleum
Assets (including any Borrowing Base Assets) or its shares in any member of the Group
that holds any interest in any such Petroleum Assets, the Obligors shall, to the
extent that they have satisfied their obligations under the First Lien Credit
Agreement to repay any utilisations thereunder from the proceeds of such disposal,
promptly upon the relevant member of the Group receiving the net proceeds, apply the
same in repayment of the Loans (where, for these purposes, “net proceeds” means, in
relation to any disposal, the proceeds of such disposal less any costs and expenses
relating to such disposal approved by the Majority Lenders).

	 	7.3.2	 	Any repayment of the Loans under Clause 7.3.1 shall satisfy the obligations
under Clause 6.2 (Repayment of Loans) in the order of maturity specified therein.

	7.4	 	Voluntary cancellation

	 	7.4.1	 	The Company may, if it gives the Agent not less than three Business Days’
(or such shorter period as the Majority Lenders may agree) prior notice, cancel the
whole or any part (being a minimum amount of $5,000,000) of the Total Available
Commitments.

	 	7.4.2	 	On the date of the cancellation of any Total Available Commitments pursuant
to Clause 7.4.1, the Commitment of each Lender shall be reduced rateably.

	7.5	 	Voluntary prepayment of Loans

	 	7.5.1	 	A Borrower to which a Loan has been made may, if it gives the Agent not less
than three Business Days’ (or such shorter period as the Majority Lenders may agree)
prior notice, prepay the whole or any part of any Loan.

	 	7.5.2	 	A Loan may only be prepaid after the last day of the Availability Period
(or, if earlier, the day on which the Total Available Commitments are reduced to
zero).

	 	7.5.3	 	Any prepayment under this Clause 7.5 (Voluntary prepayment of Loans) shall
satisfy the obligations under Clause 6.2 (Repayment of Loans) in the order of maturity
specified therein.

	 	 	 	 	 	 	 
	7.6	 	Right of repayment and cancellation in relation to a single Lender
	
 
	 	 	7.6.1	 	 	If:

	 	(A)	 	any sum payable to any Lender by an Obligor is required to
be increased under Clause 12.2.3 (Tax gross-up); or

	 	(B)	 	any Lender claims indemnification from the Company under
Clause 12.3 (Tax indemnity) or Clause 13.1 (Increased costs),

the Company may, whilst the circumstance giving rise to the requirement for
indemnification continues, give the Agent notice of cancellation of the Commitment
of that Lender and its intention to procure the repayment of that Lender’s
participation in the Loans.

	 	7.6.2	 	On receipt of a notice referred to in Clause 7.6.1, the Commitment of that
Lender shall immediately be reduced to zero.

	 	7.6.3	 	On the last day of each Interest Period which ends after the Company has
given notice under Clause 7.6.1 (or, if earlier, the date specified by the Company in
that notice), each Borrower to which a Loan is outstanding shall repay that Lender’s
participation in that Loan.

	7.7	 	Restrictions

	 	7.7.1	 	Any notice of cancellation or prepayment given by any Party under this
Clause 7 (Prepayment and cancellation) shall be irrevocable and, unless a contrary
indication appears in this Agreement, shall specify the date or dates upon which the
relevant cancellation or prepayment is to be made and the amount of that cancellation
or prepayment.

	 	7.7.2	 	Any prepayment under this Agreement shall be made together with accrued
interest on the amount prepaid and, subject to any Break Costs, without premium or
penalty.

	 	7.7.3	 	The Borrowers shall not repay or prepay all or any part of the Loans or
cancel all or any part of the Commitments except at the times and in the manner
expressly provided for in this Agreement.

	 	7.7.4	 	No amount of the Commitments cancelled under this Agreement may be
subsequently reinstated.

	 	7.7.5	 	If the Agent receives a notice under this Clause 7 (Prepayment and
cancellation) it shall promptly forward a copy of that notice to either the Company or
the affected Lender, as appropriate.

	8.	 	INTEREST

	8.1	 	Calculation of interest

The rate of interest on each Loan for each Interest Period is the percentage rate per annum
which is the aggregate of the applicable:

	 	 	 
	8.2

	 	8.1.1Margin;

8.1.2LIBOR; and

8.1.3Mandatory Cost, if any.

Payment of interest

The Borrower to which a Loan has been made shall pay accrued interest on that Loan on the
last day of each Interest Period (and, if the Interest Period is longer than six Months, on
the dates falling at six monthly intervals after the first day of the Interest Period).

	8.3	 	Default interest

	 	8.3.1	 	If an Obligor fails to pay any amount payable by it under a Finance Document
on its due date, interest shall accrue on the overdue amount from the due date up to
the date of actual payment (both before and after judgment) at a rate which, subject
to Clause 8.3.2, is two per cent. per annum higher than the rate which would have been
payable if the overdue amount had, during the period of non-payment, constituted a
Loan in the currency of the overdue amount for successive Interest Periods, each of a
duration selected by the Agent (acting reasonably). Any interest accruing under this
Clause 8.3 (Default interest) shall be immediately payable by the Obligor on demand by
the Agent.

	 	8.3.2	 	If any overdue amount consists of all or part of a Loan which became due on
a day which was not the last day of an Interest Period relating to that Loan:

	 	(A)	 	the first Interest Period for that overdue amount shall
have a duration equal to the unexpired portion of the current Interest Period
relating to that Loan; and

	 	(B)	 	the rate of interest applying to the overdue amount during
that first Interest Period shall be two per cent. higher than the rate which
would have applied if the overdue amount had not become due.

	 	8.3.3	 	Default interest (if unpaid) arising on an overdue amount will be compounded
with the overdue amount at the end of each Interest Period applicable to that overdue
amount but will remain immediately due and payable.

	8.4	 	Notification of rates of interest

The Agent shall promptly notify the Lenders and the relevant Borrower of the determination
of a rate of interest under this Agreement.

	9.	 	INTEREST PERIODS

	9.1	 	Selection of Interest Periods

	 	9.1.1	 	A Borrower (or the Company on behalf of a Borrower) may select an Interest
Period for a Loan in the Utilisation Request for that Loan or (if the Loan has already
been borrowed) in a Selection Notice.

	 	9.1.2	 	Each Selection Notice for a Loan is irrevocable and must be delivered to the
Agent by the Borrower (or the Company on behalf of a Borrower) to which that Loan was
made no later than 10.00am on the fourth Business Day prior to the last day of the
existing Interest Period for that Loan.

	 	9.1.3	 	If a Borrower (or the Company) fails to deliver a Selection Notice to the
Agent in accordance with Clause 9.1.2, the relevant Interest Period will, subject to
Clause 9.2 (Change to Interest Periods), be one Month.

	 	9.1.4	 	Subject to this Clause 9 (Interest Periods), a Borrower (or the Company on
its behalf) may select an Interest Period of one, two, three or six Months or any
other period agreed between the Company and the Agent (acting on the instructions of
all the Lenders) provided that on and from the Conversion Date, a Borrower may only
select Interest Periods which have been approved by the Agent.

	 	9.1.5	 	In addition, a Borrower (or the Company on its behalf) may select an
Interest Period of less than six Months which does not coincide with the periods
specified in Clause 9.1.4 for the purpose of ensuring that (a) the last day of such
Interest Period coincides with a Reduction Date and (b) that there are sufficient
Loans (with an aggregate amount equal to or greater than the amount required to be
repaid on such Reduction Date) which have an Interest Period ending on such Reduction
Date for the Borrowers to make the relevant repayment due on such Reduction Date.

	 	9.1.6	 	An Interest Period for a Loan shall not extend beyond the Final Maturity
Date and an Interest Period that commences before the Conversion Date must not extend
beyond the Conversion Date.

	 	9.1.7	 	Each Interest Period for a Loan shall start on the Utilisation Date or (if
already made) on the last day of its preceding Interest Period.

	9.2	 	Changes to Interest Periods

	 	9.2.1	 	Prior to determining the interest rate for a Loan, the Agent may shorten the
Interest Period for any Loan to ensure that (a) the last day of such Interest Period
coincides with a Reduction Date and (b) that there are sufficient Loans (with an
aggregate amount equal to or greater than the amount required to be repaid on such
Reduction Date) which have an Interest Period ending on such Reduction Date for the
Borrowers to make the relevant repayment due on such Reduction Date.

	 	9.2.2	 	If the Agent makes any change to an Interest Period referred to in this
Clause 9.2 (Changes to Interest Periods), it shall promptly notify the Company and the
Lenders.

	9.3	 	Non-Business Days

If an Interest Period would otherwise end on a day which is not a Business Day, that
Interest Period will instead end on the next Business Day in that calendar month (if there
is one) or the preceding Business Day (if there is not).

	 	 	 	 	 	 	 
	9.4	 	Consolidation and division of Loans
	
 
	 	 	9.4.1	 	 	Subject to Clause 9.4.2, if two or more Interest Periods:

	 	(A)	 	relate to Loans;

	 	(B)	 	end on the same date; and

	 	(C)	 	are made to the same Borrower,

those Loans will, unless that Borrower (or the Company on its behalf) specifies to
the contrary in the Selection Notice for the next Interest Period, be consolidated
into, and treated as, a single Loan on the last day of the Interest Period.

	 	9.4.2	 	Subject to Clause 4.3 (Maximum number of Loans) and Clause 5.3 (Currency and
amount), if a Borrower (or the Company on its behalf) requests in a Selection Notice
that a Loan be divided into two or more Loans, that Loan will, on the last day of its
Interest Period, be so divided into the amounts specified in that Selection Notice,
being an aggregate amount equal to the amount of the Loan immediately before its
division.

	10.	 	CHANGES TO THE CALCULATION OF INTEREST

	10.1	 	Absence of quotations

Subject to Clause 10.2 (Market disruption), if LIBOR is to be determined by reference to
the Reference Banks but a Reference Bank does not supply a quotation by 11.00 a.m. (London
time) on the Quotation Day, LIBOR shall be determined on the basis of the quotations of the
remaining Reference Banks.

	10.2	 	Market disruption

	 	10.2.1	 	If a Market Disruption Event occurs in relation to a Loan for any Interest Period,
then the rate of interest on each Lender’s share of that Loan for the Interest Period
shall be the rate per annum which is the sum of:

	 	(A)	 	the Margin;

	 	(B)	 	the rate notified to the Agent by that Lender as soon as
practicable and in any event before interest is due to be paid in respect of
that Interest Period, to be that which expresses as a percentage rate per
annum the cost to that Lender of funding its participation in that Loan from
whatever source it may reasonably select; and

	 	(C)	 	the Mandatory Cost, if any, applicable to that Lender’s
participation in the Loan.

	 	10.2.2	 	In this Agreement “Market Disruption Event” means:

	 	(A)	 	at or about noon on the Quotation Day for the relevant
Interest Period the Screen Rate is not available and none or only one of the
Reference Banks supplies a rate to the Agent to determine LIBOR for dollars
and the relevant Interest Period; or

	 	(B)	 	before close of business in London on the Quotation Day for
the relevant Interest Period, the Agent receives notifications from a Lender
or Lenders (whose participations in a Loan exceed 30 per cent. of that Loan)
that the cost to it or them of obtaining matching deposits in the London
interbank market would be in excess of LIBOR.

	10.3	 	Alternative basis of interest or funding

	 	10.3.1	 	If a Market Disruption Event occurs and the Agent or the Company so requires, the
Agent and the Company shall enter into negotiations (for a period of not more than
thirty days) with a view to agreeing a substitute basis for determining the rate of
interest.

	 	10.3.2	 	Any alternative basis agreed pursuant to Clause 10.3.1 shall, with the prior consent
of all the Lenders and the Company, be binding on all Parties.

	10.4	 	Break Costs

	 	10.4.1	 	Each Borrower shall, within three Business Days of demand by a Finance Party, pay to
that Finance Party its Break Costs attributable to all or any part of a Loan or Unpaid
Sum being paid by that Borrower on a day other than the last day of an Interest Period
for that Loan or Unpaid Sum.

	 	10.4.2	 	Each Lender shall, as soon as reasonably practicable after a demand by the Agent,
provide a certificate confirming the amount of its Break Costs for any Interest Period
in which they accrue and showing how that amount was calculated.

	11.	 	FEES

	11.1	 	Commitment fee

The Borrowers shall pay to the Agent (for the account of each Lender) in respect of the
Availability Period a fee computed at the applicable Commitment Rate on the daily amount
(if any) by which the Aggregate Commitments exceed the aggregate amount of the Loans.

	11.2	 	Computation and payment

	 	11.2.1	 	Any commitment fee payable under this Clause 11 (Fees) must be paid by the relevant
Borrower(s) within two Business Days after receipt by the Company of the calculation
of such commitment fee or, as the case may be, such letter of credit commission from
the Agent under Clause 11.2.3.

	 	11.2.2	 	Any such commitment fee must be paid in dollars.

	 	11.2.3	 	The Agent shall calculate the commitment fee payable for the Availability Period and
shall notify the Company of the same within five Business Days after the end of the
Availability Period. Each such calculation shall, in the absence of manifest error,
be conclusive evidence of the amount thereof.

	11.3	 	Definitions

For the purposes of this Agreement, “Commitment Rate” means, on any date, the percentage
rate per annum which is equal to 50% of the Margin that is applicable on such date.

	11.4	 	Other fees and costs

The Borrowers will pay to the relevant Finance Parties the relevant fees and other costs
and expenses in the amounts and at the times set out in the Fee Letters.

	11.5	 	Representatives

	 	11.5.1	 	Subject to Clause 11.5.2 (Value added tax) 12.6.2below, the Company shall, (or shall
procure that an Obligor will) within five Business Days of demand by the Agent or the
Security Trustee pay, or reimburse the relevant Administrative Finance Party for any
payments that it has made in relation to, any reasonable fees, costs and expenses that
the relevant Administrative Finance Party has properly incurred in connection with the
appointment by such Administrative Finance Party of any legal adviser, insurance
adviser, environmental consultant, engineering consultant, model auditor or tax model
auditor, in each case, in connection with the exercise of its rights and discretions
or the performance of its duties and obligations, under the Finance Documents.

	 	11.5.2	 	Save to the extent that such fees, costs and expenses have been incurred in
circumstances where a Default has occurred, the Company shall only be obliged to pay
or reimburse (or shall procure that an Obligor will pay or reimburse) the relevant
Administrative Finance Party for any fees, costs and expenses incurred by it if the
Company has approved the appointment of the relevant adviser, consultant or auditor
and the terms (including fees) of the appointment (such approval not to be
unreasonably withheld or delayed).

	12.	 	TAX GROSS UP AND INDEMNITIES

	 	 	 	 	 	 	 
	12.1	 	Definitions
	
 
	 	 	12.1.1	 	 	In this Agreement:

“Protected Party” means a Finance Party which is or will be subject to any
liability, or required to make any payment, for or on account of Tax in relation
to a sum received or receivable (or any sum deemed for the purposes of Tax to be
received or receivable) under a Finance Document.

“Qualifying Lender” means:

	 	(A)	 	a Lender (other than a Lender within paragraph (B) below)
which is beneficially entitled to interest payable to that Lender in respect
of an advance under a Finance Document and is:

	 	(1)	 	a Lender:

	 	(a)	 	which is a bank (as defined
for the purpose of section 879 of the ITA) making an advance
under a Finance Document; or

	 	(b)	 	in respect of an advance
made under a Finance Document by a person that was a bank (as
defined for the purpose of section 879 of the ITA) at the
time that that advance was made,

and which is within the charge to United Kingdom corporation tax
as respects any payments of interest made in respect of that
advance; or

	 	(2)	 	a Lender which is:

	 	(a)	 	a company so resident in
the United Kingdom;

	 	(b)	 	a partnership each member
of which is

	 	(i)	 	a company
resident in the United Kingdom for United Kingdom tax
purposes; or

	 	(ii)	 	a company
not so resident in the United Kingdom which carries
on a trade in the United Kingdom through a permanent
establishment and which brings into account in
computing its chargeable profits (for the purposes of
section 11(2) of the Taxes Act) the whole of any
share of interest payable in respect of that advance
that falls to it by reason of sections 114 and 115 of
the Taxes Act;

	 	(c)	 	a company not so resident
in the United Kingdom which carries on a trade in the United
Kingdom through a permanent establishment and which brings
into account interest payable in respect of that advance in
computing its chargeable profits (within the meaning given by
section 11(2) of the Taxes Act); or

	 	(3)	 	a Treaty Lender; or

	 	(B)	 	a building society (as defined for the purposes of Section
880 of the ITA) making an advance under a Finance Document.

“Tax Confirmation” means a confirmation by a Lender that the person beneficially
entitled to interest payable to that Lender in respect of an advance under a
Finance Document is:

	 	(A)	 	a company resident in the United Kingdom, for United
Kingdom tax purposes;

	 	(B)	 	a partnership each member of which is:

	 	(1)	 	a company so resident in the United
Kingdom; or

	 	(2)	 	a company not so resident in the United
Kingdom which carries on a trade in the United Kingdom through a
permanent establishment and which brings into account in computing
its chargeable profits (for the purposes of section 11(2) of the
Taxes Act) the whole of any share of interest payable in respect of
that advance that falls to it by reason of sections 114 and 115 of
the Taxes Act; or

	 	(C)	 	a company not so resident in the United Kingdom which
carries on a trade in the United Kingdom through a permanent establishment
and which brings into account interest payable in respect of that advance in
computing its chargeable profits (for the purposes of section 11(2) of the
Taxes Act).

“Tax Credit” means a credit against, relief or remission for, or repayment of any
Tax.

“Tax Deduction” means a deduction or withholding for or on account of Tax from a
payment under a Finance Document.

“Tax Payment” means either the increase in a payment made by an Obligor to a
Finance Party under Clause 12.2 (Tax gross-up) or a payment under Clause 12.3 (Tax
indemnity).

“Treaty Lender” means a Lender which:

	 	(A)	 	in the case of an Obligor which is resident in the United
Kingdom, is treated as a resident of a Treaty State for the purposes of the
Treaty and does not carry on a business in the United Kingdom through a
permanent establishment with which that Lender’s participation in the Loan is
effectively connected; or

	 	(B)	 	in the case of an Obligor which is not resident in the
United Kingdom, is treated as resident in a jurisdiction which has a double
taxation agreement with the jurisdiction in which the Obligor is resident or
treated as resident, which double tax treaty makes provision (subject to
satisfaction of any conditions provided therein) for full exemption from Tax
Deductions imposed by the jurisdiction in which the Obligor is resident or
treated as resident.

“Treaty State” means a jurisdiction having a double taxation agreement (a
“Treaty") with the United Kingdom which (subject to satisfaction of any conditions
provided for therein) makes provision for full exemption from tax imposed by the
United Kingdom on interest.

“UK Non-Bank Lender” means:

	 	(A)	 	where a Lender becomes a Party on the day on which this
Agreement is entered into, a Lender listed in Schedule 2 (The Original
Lenders) and identified as a “UK Non-Bank Lender” in that Schedule; and

	 	(B)	 	where a Lender becomes a Party after the day on which this
Agreement is entered into, a Lender which gives a Tax Confirmation in the
Transfer Certificate which it executes on becoming a Party.

	 	12.1.2	 	Unless a contrary indication appears, in this Clause 12 (Tax gross-up and
indemnities) a reference to “determines” or “determined” means a determination made in
the absolute discretion of the person making the determination.

	12.2	 	Tax gross-up

	 	12.2.1	 	Each Obligor shall make all payments to be made by it without any Tax Deduction,
unless a Tax Deduction is required by law.

	 	12.2.2	 	The Company shall promptly upon becoming aware that an Obligor must make a Tax
Deduction (or that there is any change in the rate or the basis of a Tax Deduction)
notify the Agent accordingly. Similarly, a Lender shall notify the Agent on becoming
so aware in respect of a payment payable to that Lender. If the Agent receives such
notification from a Lender it shall notify the Company and that Obligor.

	 	12.2.3	 	If a Tax Deduction is required by law to be made by an Obligor, the amount of the
payment due from that Obligor shall be increased to an amount which (after making any
Tax Deduction) leaves an amount equal to the payment which would have been due if no
Tax Deduction had been required.

	 	12.2.4	 	An Obligor is not required to make an increased payment to a Lender under Clause
12.2.3 above for a Tax Deduction in respect of tax imposed by the United Kingdom from
a payment of interest on a Loan, if on the date on which the payment falls due:

	 	(A)	 	the payment could have been made to the relevant Lender
without a Tax Deduction if it was a Qualifying Lender, but on that date that
Lender is not or has ceased to be a Qualifying Lender other than as a result
of any change after the date it became a Lender under this Agreement in (or
in the interpretation, administration, or application of) any law or Treaty,
or any published practice or concession of any relevant taxing authority; or

	 	 	 	(B)

	 	(1)	 	the relevant Lender is a Qualifying Lender
solely under paragraph (A)(2) of the definition of “Qualifying
Lender” set out in Clause 12.1.1 (Definitions);

	 	(2)	 	an officer of H.M. Revenue & Customs has
given (and not revoked) a direction (a “Direction") under section 931
of the ITA (as that provision has effect on the date on which the
relevant Lender became a Party) which relates to that payment and
that Lender has received from that Obligor or the Company a certified
copy of that Direction; and

	 	(3)	 	the payment could have been made to the
Lender without any Tax Deduction in the absence of that Direction; or

	 	(C)	 	the relevant Lender is a Qualifying Lender solely under
paragraph (A)(2) of the definition of “Qualifying Lender” set out in Clause
12.1.1 (Definitions) and it has not, other than by reason of any change after
the date of this Agreement in (or in the interpretation, administration, or
application of) any law, or any published practice or concession of any
relevant taxing authority, given a Tax Confirmation to the Company; or

	 	(D)	 	the relevant Lender is a Treaty Lender and the Obligor
making the payment is able to demonstrate that the payment could have been
made to the Lender without the Tax Deduction had that Lender complied with
its obligations under Clause 12.2.7 below.

	 	12.2.5	 	If an Obligor is required to make a Tax Deduction, that Obligor shall make that Tax
Deduction and any payment required in connection with that Tax Deduction within the
time allowed and in the minimum amount required by law.

	 	12.2.6	 	Within thirty days of making either a Tax Deduction or any payment required in
connection with that Tax Deduction, the Obligor making that Tax Deduction shall
deliver to the Agent for the Finance Party entitled to the payment evidence reasonably
satisfactory to that Finance Party that the Tax Deduction has been made or (as
applicable) any appropriate payment paid to the relevant taxing authority.

	 	12.2.7	 	A Treaty Lender and each Obligor which makes a payment to which that Treaty Lender
is entitled shall co-operate in completing any procedural formalities necessary for
that Obligor to obtain authorisation to make that payment without a Tax Deduction.

	 	12.2.8	 	A UK Non-Bank Lender which becomes a Party on the day on which this Agreement is
entered into gives a Tax Confirmation to the Company by entering into this Agreement.

	 	12.2.9	 	A UK Non-Bank Lender shall promptly notify the Company and the Agent if there is any
change in the position from that set out in the Tax Confirmation.

	 	12.2.10	 	Each Lender that:

	 	(A)	 	is a Lender as at the date of this Agreement confirms on
the date of this Agreement; or

	 	(B)	 	becomes a Lender after the date of this Agreement confirms
on the date on which it becomes a Lender pursuant to Clause 24 (Changes to
the Lenders),

that it is a Qualifying Lender. A Lender will notify the Agent if it ceases to be
a Qualifying Lender at any time. The Agent will promptly upon receipt of any such
notification provide the Company a copy of the same.

	12.3	 	Tax indemnity

	 	12.3.1	 	The Company shall (or shall procure that an Obligor will) (within three Business
Days of demand by the Agent, such demand to be accompanied by a written calculation of
the amount claimed by the Protected Party) pay to a Protected Party an amount equal to
the loss, liability or cost which that Protected Party determines will be or has been
(directly or indirectly) suffered for or on account of Tax by that Protected Party in
respect of a Finance Document.

	 	12.3.2	 	Clause 12.3.1 above shall not apply:

	 	(A)	 	with respect to any Tax assessed on a Finance Party:

	 	(1)	 	under the law of the jurisdiction in which
that Finance Party is incorporated or, if different, the jurisdiction
(or jurisdictions) in which that Finance Party is treated as resident
for tax purposes; or

	 	(2)	 	under the law of the jurisdiction in which
that Finance Party’s Facility Office is located in respect of amounts
received or receivable in that jurisdiction,

if that Tax is imposed on or calculated by reference to the net income
received or receivable (but not any sum deemed to be received or
receivable) by that Finance Party; or

	 	(B)	 	to the extent a loss, liability or cost:

	 	(1)	 	is compensated for by an increased payment
under Clause 12.2 (Tax gross-up); or

	 	(2)	 	would have been compensated for by an
increased payment under Clause 12.2 (Tax gross-up) but was not so
compensated solely because one of the exclusions in Clause 12.2.4
(Tax gross up) applied.

	 	12.3.3	 	A Protected Party making, or intending to make a claim under Clause 12.3.1 above
shall promptly notify the Agent of the event which will give, or has given, rise to
the claim, following which the Agent shall notify the Company.

	 	12.3.4	 	A Protected Party shall, on receiving a payment from an Obligor under this Clause
12.3 (Tax indemnity), notify the Agent.

	12.4	 	Tax Credit

If an Obligor makes a Tax Payment and the relevant Finance Party determines that:

	 	12.4.1	 	a Tax Credit is attributable either to an increased payment of which that Tax
Payment forms part, or to that Tax Payment; and

	 	12.4.2	 	that Finance Party has obtained, utilised and retained that Tax Credit,

the Finance Party shall pay an amount to the Obligor which that Finance Party determines
will leave it (after that payment) in the same after-Tax position as it would have been in
had the Tax Payment not been required to be made by the Obligor.

	12.5	 	Stamp taxes

The Company shall (or shall procure that an Obligor will) pay and, within three Business
Days of demand, indemnify each Finance Party against any cost, loss or liability that
Finance Party incurs in relation to all stamp duty, registration and other similar Taxes
payable in respect of any Finance Document (other than a Transfer Certificate).

	12.6	 	Value added tax

	 	12.6.1	 	All amounts set out, or expressed to be payable under a Finance Document by any
Party to a Finance Party which (in whole or in part) constitute the consideration for
VAT purposes shall be deemed to be exclusive of any VAT which is chargeable on such
supply, and accordingly, subject to Clause 12.6.3 (Value added tax), if VAT is
chargeable on any supply made by any Finance Party to any Party under a Finance
Document, that Party shall pay to the Finance Party (in addition to and at the same
time as paying the consideration) an amount equal to the amount of the VAT (and such
Finance Party shall promptly provide an appropriate VAT invoice to such Party).

	 	12.6.2	 	If VAT is chargeable on any supply made by any Finance Party (the “Supplier") to any
other Finance Party (the “Recipient") under a Finance Document, and any Party (the
“Relevant Party") is required by the terms of any Finance Document to pay an amount
equal to the consideration for such supply to the Supplier (rather than being required
to reimburse the Recipient in respect of that consideration), such Party shall also
pay to the Supplier (in addition to and at the same time as paying such amount) an
amount equal to the amount of such VAT. The Recipient will promptly pay to the
Relevant Party an amount equal to any credit or repayment from the relevant tax
authority which it reasonably determines relates to the VAT chargeable on that supply.

	 	12.6.3	 	Where a Finance Document requires any Party to reimburse a Finance Party for any
costs or expenses, that Party shall also at the same time pay and indemnify the
Finance Party against all VAT incurred by the Finance Party in respect of the costs or
expenses to the extent that the Finance Party reasonably determines that neither it
nor any other member of any group of which it is a member for VAT purposes is entitled
to credit or repayment from the relevant tax authority in respect of the VAT.

	13.	 	INCREASED COSTS

	13.1	 	Increased costs

	 	13.1.1	 	Subject to Clause 13.3 (Exceptions), the Company shall (or shall procure that an
Obligor will), within three Business Days of a demand by the Agent, pay for the
account of a Finance Party the amount of any Increased Costs incurred by that Finance
Party or any of its Affiliates as a result of (i) the introduction of or any change in
(or in the interpretation, administration or application of) any law or regulation or
(ii) compliance with any law or regulation made after the date of this Agreement.

	 	13.1.2	 	In this Agreement “Increased Costs” means:

	 	(A)	 	a reduction in the rate of return from the Facility or on a
Finance Party’s (or its Affiliate’s) overall capital;

	 	(B)	 	an additional or increased cost; or

	 	(C)	 	a reduction of any amount due and payable under any Finance
Document,

which is incurred or suffered by a Finance Party or any of its Affiliates to the
extent that it is attributable to that Finance Party having entered into its
Commitment or funding or performing its obligations under any Finance Document.

	13.2	 	Increased cost claims

	 	13.2.1	 	A Finance Party intending to make a claim pursuant to Clause 13.1 (Increased costs)
shall notify the Agent of the event giving rise to the claim, following which the
Agent shall promptly notify the Company.

	 	13.2.2	 	Each Finance Party shall, as soon as practicable after a demand by the Agent or the
Company, provide a certificate confirming the amount of its Increased Costs and
setting out the calculation of such amount in reasonable detail.

	13.3	 	Exceptions

	 	13.3.1	 	Clause 13.1 (Increased costs) does not apply to the extent any Increased Cost is:

	 	(A)	 	attributable to a Tax Deduction required by law to be made
by an Obligor;

	 	(B)	 	compensated for by Clause 12.3 (Tax indemnity) (or would
have been compensated for under Clause 12.3 (Tax indemnity) but was not so
compensated solely because any of the exclusions in Clause 12.3.2 (Tax
indemnity) applied);

	 	(C)	 	compensated for by the payment of the Mandatory Cost;

	 	(D)	 	attributable to the wilful breach by the relevant Finance
Party or its Affiliates of any law or regulation or any Finance Document to
which it is a party; or

	 	(E)	 	attributable to the implementation or application of or
compliance with the Basle II Accord or any law or regulation which implements
the Basle II Accord.

	 	13.3.2	 	In this Clause 13.3 (Exceptions):

	 	(A)	 	a reference to a “Tax Deduction” has the same meaning given
to the term in Clause 12.1 (Definitions); and

	 	(B)	 	“Basle II Accord” means the paper titled “International
Convergence of Capital Measurement and Capital Standards, a Revised
Framework” published by the Basle Committee on Banking Supervision in June
2004 in the form existing as at the date of this Agreement.

	14.	 	OTHER INDEMNITIES

	14.1	 	Currency indemnity

	 	14.1.1	 	If any sum due from an Obligor under the Finance Documents (a “Sum"), or any order,
judgment or award given or made in relation to a Sum, has to be converted from the
currency (the “First Currency") in which that Sum is payable into another currency
(the “Second Currency") for the purpose of:

	 	(A)	 	making or filing a claim or proof against that Obligor; or

	 	(B)	 	obtaining or enforcing an order, judgment or award in
relation to any litigation or arbitration proceedings,

that Obligor shall as an independent obligation, within three Business Days of
demand, indemnify each Finance Party to whom that Sum is due against any cost,
loss or liability arising out of or as a result of the conversion including any
discrepancy between (i) the rate of exchange used to convert that Sum from the
First Currency into the Second Currency and (ii) the rate or rates of exchange
available to that person at the time of its receipt of that Sum.

	 	14.1.2	 	Without prejudice to Clause 14.1.1, each Obligor shall as an independent obligation,
within three Business Days of demand, indemnify each Finance Party against any cost,
loss or liability which that Finance Party incurs as a result of that Finance Party
receiving an amount in respect of that Obligor’s liability under any Finance Document
in a currency other than the currency in which that liability is expressed to be
payable under that Finance Document.

	 	14.1.3	 	Each Obligor waives any right it may have in any jurisdiction to pay any amount
under the Finance Documents in a currency or currency unit other than that in which it
is expressed to be payable.

	14.2	 	Other indemnities

The Company shall (or shall procure that an Obligor will), within three Business Days of
demand, indemnify each Finance Party against any cost, loss or liability incurred by that
Finance Party as a result of:

	 	14.2.1	 	the occurrence of any Event of Default;

	 	14.2.2	 	a failure by an Obligor to pay any amount due under a Finance Document on its due
date, including, any cost, loss or liability arising as a result of Clause 28 (Sharing
among the Finance Parties);

	 	14.2.3	 	funding, or making arrangements to fund, its participation in a Loan requested by a
Borrower in a Utilisation Request but not made by reason of the operation of any one
or more of the provisions of this Agreement (other than by reason of default or
negligence by that Finance Party alone);

	 	14.2.4	 	a Loan (or part of a Loan) not being prepaid in accordance with a notice of
prepayment given hereunder; or

	 	14.2.5	 	the release of any Security constituted by any Finance Document or any release of
any Obligor which is permitted under the Finance Documents.

	14.3	 	Indemnity to the Agent

The Company shall (or shall procure that an Obligor will) promptly indemnify the Agent
against any cost, loss or liability incurred by the Agent (acting reasonably) as a result
of:

	 	14.3.1	 	investigating any event which it reasonably believes is a Default; or

	 	14.3.2	 	acting or relying on any notice, request or instruction which it reasonably believes
to be genuine, correct and appropriately authorised.

	15.	 	MITIGATION BY THE LENDERS

	15.1	 	Mitigation

	 	15.1.1	 	Each Finance Party shall, in consultation with the Company, take all reasonable
steps to mitigate any circumstances which arise and which would result in any amount
becoming payable under or pursuant to, or cancelled pursuant to, any of Clause 7.1
(Illegality), Clause 12 (Tax gross-up and indemnities), Clause 13 (Increased costs) or
paragraph 3 of Schedule 5 (Mandatory Cost Formulae) including transferring its rights
and obligations under the Finance Documents to another Affiliate or Facility Office.

	 	15.1.2	 	Clause 15.1.1 does not in any way limit the obligations of any Obligor under the
Finance Documents.

	15.2	 	Limitation of liability

	 	15.2.1	 	The Company shall (or shall procure that an Obligor will) indemnify each Finance
Party for all costs and expenses reasonably incurred by that Finance Party as a result
of steps taken by it under Clause 15.1 (Mitigation).

	 	15.2.2	 	A Finance Party is not obliged to take any steps under Clause 15.1 (Mitigation) if,
in the opinion of that Finance Party (acting reasonably), to do so might be
prejudicial to it.

	16.	 	COSTS AND EXPENSES

	16.1	 	Transaction expenses

The Company shall (or shall procure that an Obligor will) promptly on demand pay the
Administrative Finance Parties the amount of all costs and expenses (including legal fees)
reasonably incurred by any of them in connection with:

	 	16.1.1	 	the negotiation, preparation, printing, execution and syndication of:

	 	(A)	 	this Agreement and any other documents referred to in this
Agreement; and

	 	(B)	 	any other Finance Documents (other than a Transfer
Certificate) executed after the date of this Agreement; and

	 	16.1.2	 	the completion of the transactions and perfection of the Security intended to be
created pursuant to the Security Documents,

	 	 	 
	16.2

	 	subject to any applicable cap agreed between the Company and the Agent.

Amendment costs

If (a) a relevant party requests an amendment, waiver or consent to any Finance Document or
(b) an amendment is required pursuant to Clause 29.9 (Change of currency), the Obligors
shall, within three Business Days of demand, reimburse the Finance Parties for the amount
of all costs and expenses (including legal fees) reasonably incurred by the Finance Parties
in responding to, evaluating, negotiating or complying with that request or requirement.
For the purposes of this Clause, “relevant party” means any Obligor or any other party
(other than a Finance Party) to a Finance Document.

	16.3	 	Enforcement costs

The Company shall (or shall procure that an Obligor will), within three Business Days of
demand, pay to each Finance Party the amount of all costs and expenses (including legal
fees) incurred by that Finance Party in connection with the enforcement of, or the
preservation of any rights under, any Finance Document.

	17.	 	GUARANTEE AND INDEMNITY

	17.1	 	Guarantee and indemnity

Each Guarantor irrevocably and unconditionally jointly and severally:

	 	17.1.1	 	guarantees to each Finance Party punctual performance by each other Obligor of all
that other Obligor’s obligations under the Finance Documents;

	 	17.1.2	 	undertakes with each Finance Party that whenever an Obligor does not pay any amount
when due under or in connection with any Finance Document, that Guarantor shall
immediately on demand pay that amount as if it was the principal obligor; and

	 	17.1.3	 	indemnifies each Finance Party immediately on demand against any cost, loss or
liability suffered by that Finance Party if any obligation guaranteed by it is or
becomes unenforceable, invalid or illegal. The amount of the cost, loss or liability
shall be equal to the amount which that Finance Party would otherwise have been
entitled to recover.

	17.2	 	Continuing guarantee

This guarantee is a continuing guarantee and will extend to the ultimate balance of sums
payable by any Obligor under the Finance Documents, regardless of any intermediate payment
or discharge in whole or in part.

	17.3	 	Reinstatement

If any payment by an Obligor or any discharge given by a Finance Party (whether in respect
of the obligations of any Obligor or any security for those obligations or otherwise) is
avoided or reduced as a result of insolvency or any similar event:

	 	17.3.1	 	the liability of each Obligor shall continue as if the payment, discharge, avoidance
or reduction had not occurred; and

	 	17.3.2	 	each Finance Party shall be entitled to recover the value or amount of that security
or payment from each Obligor, as if the payment, discharge, avoidance or reduction had
not occurred.

	17.4	 	Waiver of defences

The obligations of each Guarantor under this Clause 17 (Guarantee and indemnity) will not
be affected by (and the intention of each Guarantor is that its obligations shall continue
in full force and effect notwithstanding) any act, omission, matter or thing which, but for
this Clause 17.4 (Waiver of defences), would reduce, release or prejudice any of its
obligations under this Clause 17 (Guarantee and indemnity) (without limitation and whether
or not known to it or any Finance Party) including:

	 	17.4.1	 	any time, waiver or consent granted to, or composition with, any Obligor or other
person;

	 	17.4.2	 	the release of any other Obligor or any other person under the terms of any
composition or arrangement with any creditor of any Obligor or other person;

	 	17.4.3	 	the taking, variation, compromise, exchange, renewal or release of, or refusal or
neglect to perfect, take up or enforce, any rights against, or security over assets
of, any Obligor or other person or any non-presentation or non-observance of any
formality or other requirement in respect of any instrument or any failure to realise
the full value of any security;

	 	17.4.4	 	any incapacity or lack of power, authority or legal personality of or dissolution or
change in the members or status of an Obligor or any other person;

	 	17.4.5	 	any amendment, novation, supplement, extension, restatement (however fundamental and
whether or not more onerous) or replacement of any Finance Document or any other
document or security including any change in the purpose of, any extension of or any
increase in any facility or the addition of any new facility under any Finance
Document or other document or security;

	 	17.4.6	 	any unenforceability, illegality or invalidity of any obligation of any person under
any Finance Document or any other document or security; or

	 	17.4.7	 	any insolvency or similar proceedings.

	17.5	 	Immediate recourse

Each Guarantor waives any right it may have of first requiring any Finance Party (or any
trustee or agent on its behalf) to proceed against or enforce any other rights or security
or claim payment from any person before claiming from that Guarantor under this Clause 17
(Guarantee and indemnity). This waiver applies irrespective of any law or any provision of
a Finance Document to the contrary.

	17.6	 	Appropriations

Until all amounts which may be or become payable by the Obligors under or in connection
with the Finance Documents have been irrevocably paid in full, each Finance Party (or any
trustee or agent on its behalf) may:

	 	17.6.1	 	refrain from applying or enforcing any other moneys, security or rights held or
received by that Finance Party (or any trustee or agent on its behalf) in respect of
those amounts, or apply and enforce the same in such manner and order as it sees fit
(whether against those amounts or otherwise) and no Guarantor shall be entitled to the
benefit of the same; and

	 	17.6.2	 	hold in an interest-bearing suspense account any moneys received from any Guarantor
or on account of any Guarantor’s liability under this Clause 17 (Guarantee and
indemnity).

	17.7	 	Deferral of Guarantors’ rights

	 	17.7.1	 	Until all amounts which may be or become payable by the Obligors under or in
connection with the Finance Documents have been irrevocably paid in full and unless
the Agent or the Security Trustee otherwise directs, no Guarantor will exercise any
rights which it may have by reason of performance by it of its obligations under the
Finance Documents:

	 	(A)	 	to be indemnified by an Obligor;

	 	(B)	 	to claim any contribution from any other guarantor of any
Obligor’s obligations under the Finance Documents;

	 	(C)	 	to take the benefit (in whole or in part and whether by way
of subrogation or otherwise) of any rights of the Finance Parties under the
Finance Documents or of any other guarantee or security taken pursuant to, or
in connection with, the Finance Documents by any Finance Party; and/or

	 	(D)	 	to claim any set off or counterclaim against any other
Obligor or any other person liable or claim or prove in competition with the
Finance Parties in the bankruptcy or liquidation of any other Obligor or any
other person liable or have the benefit of, or share in, any payment from or
composition with, any other Obligor or any other person liable or any other
security now or hereafter held by the Finance Parties in respect of the
obligations of any Obligor under the Finance Documents or for the obligations
or liabilities of any other person liable but so that, if so directed by the
Agent or the Security Trustee, it will prove for the whole or any part of its
claim in the liquidation or bankruptcy of any other Obligor on terms that the
benefit of such proof and of all of the money received by it in respect
thereof shall be held on trust for the Finance Parties and applied in or
towards discharge of the obligations of the Obligors under the Finance
Documents in such manner as the Agent or the Security Trustee shall deem
appropriate.

	 	17.7.2	 	Without prejudice to Clause 17.7.1(D) or Clause 17.8 (Agent’s authority), if a
Guarantor receives any benefit, payment or distribution in relation to such rights
described in Clause 17.7.1, it shall hold that benefit, payment or distribution to the
extent necessary to enable all amounts which may be or become payable to the Finance
Parties by the Obligors under or in connection with the Finance Documents to be repaid
in full on trust for the Finance Parties and shall promptly pay or transfer the same
to the Agent or as the Agent may direct for application in accordance with Clause 29
(Payment mechanics).

	17.8	 	Agent’s authority

If any Guarantor fails to claim or prove in the liquidation or bankruptcy of any other
Obligor promptly upon being directed to do so by the Agent or the Security Trustee as
contemplated by Clause 17.7.1(D) (Deferral of Guarantors’ rights):

	 	17.8.1	 	the Agent or the Security Trustee (as the case may be) may, and is irrevocably
authorised on behalf of such Obligor to, file any claims or proofs in such liquidation
or bankruptcy on its behalf; and

	 	17.8.2	 	the Agent or the Security Trustee (as the case may be) may direct the trustee in
bankruptcy, liquidator, assignee or other person distributing the assets of any
Obligor or their proceeds to pay distributions on the obligations or liabilities of
such Obligor direct to the Agent or the Security Trustee on behalf of the Finance
Parties until all amounts which may be or become payable by the Obligors under or in
connection with the Finance Documents have been irrevocably paid in full.

	17.9	 	Release of Guarantors’ right of contribution

If any Guarantor (a “Retiring Guarantor") ceases to be a Guarantor in accordance with the
terms of the Finance Documents for the purpose of any sale or other disposal of that
Retiring Guarantor that is permitted under the terms of the Finance Documents, then on the
date such Retiring Guarantor ceases to be a Guarantor:

	 	17.9.1	 	that Retiring Guarantor is released by each other Guarantor from any liability
(whether past, present or future and whether actual or contingent) to make a
contribution to any other Guarantor arising by reason of the performance by any other
Guarantor of its obligations under the Finance Documents; and

	 	17.9.2	 	each other Guarantor waives any rights it may have by reason of the performance of
its obligations under the Finance Documents to take the benefit (in whole or in part
and whether by way of subrogation or otherwise) of any rights of the Finance Parties
under any Finance Document or of any other security taken pursuant to, or in
connection with, any Finance Document where such rights or security are granted by or
in relation to the assets of the Retiring Guarantor.

	17.10	 	Additional security

This guarantee is in addition to and is not in any way prejudiced by any other guarantee or
security now or subsequently held by any Finance Party.

	17.11	 	Limitation of guarantee

Notwithstanding any other provision of any Finance Document, the amount guaranteed by each
Guarantor hereunder shall be limited to the extent, if any, required so that its
obligations under this Clause 17 (Guarantee and indemnity) shall not be subject to
avoidance under Section 548 of Title 11 of the United States Code, or to being set aside or
annulled under any applicable law or regulation relating to fraud on creditors. In
determining the limitations, if any, on the amount of any Guarantor’s obligations hereunder
pursuant to the preceding sentence, it is the intention of the parties hereto that any
rights of subrogation or contribution which such Guarantor may have under this Clause 17
(Guarantee and indemnity), any other agreement or applicable law or regulation shall be
taken into account.

3

CASH SWEEP AND EXPENDITURE CONTROLS

	18.	 	CASH SWEEP AND EXPENDITURE CONTROLS

	18.1	 	Cash sweep

	 	18.1.1	 	On and from the Conversion Date, the Obligors shall, on the last day of each
Interest Period, withdraw all Excess Amounts and apply the same in prepayment of the
Loans.

	 	18.1.2	 	Any repayment of the Loans under Clause 18.1.1 shall satisfy the obligations under
Clause 6.2 (Repayment of Loans) in inverse order of maturity.

	 	18.1.3	 	For these purposes:

	 	(A)	 	“Excess Amounts” means, on any date:

	 	(1)	 	the aggregate amounts standing to the
credit of the Proceeds Accounts on such date other than such amounts
which the Company can demonstrate to the reasonable satisfaction of
the Majority Lenders will be required by the relevant obligors for
the purposes of:

	 	(a)	 	paying any amounts which
are due and payable under the First Lien Documents and the
Secured Hedging Agreements;

	 	(b)	 	meeting any Permitted
Expenditure which is due and payable;

	 	(c)	 	meeting any accrued
interest which is due and payable under this Agreement or the
$81,250,000 convertible senior notes due 2012 referred to in
Clause 21.6.2(B)(Financial Indebtedness); or

	 	(d)	 	to the extent that the same
has been approved by the Majority Lenders, any other amounts
due and payable,

in each case, in the period of 60 days commencing on such date;
and

	 	(2)	 	to the extent that the aggregate amounts
standing to the credit of any bank accounts (other than any Project
Accounts) of any other member of the Group on such date exceeds
$1,000,000, all such amounts standing to the credit of such bank
accounts;

	 	(B)	 	“relevant obligor” means any obligor under the First Lien
Credit Agreement that is obliged thereunder to maintain a Proceeds Account.

	18.2	 	Controls over discretionary expenditure

Unless the Majority Lenders otherwise consent, on and from the Conversion Date:

	 	18.2.1	 	no Obligor may, and each Obligor shall ensure that no member of the Group will,
incur any expenditure in connection with any Petroleum Asset in which it has an
interest (other than any Borrowing Base Asset); and

	 	18.2.2	 	no Obligor may, and each Obligor shall ensure that no member of the Group will, in
any event, commit itself to incur any expenditure in connection with any Petroleum
Asset in which it has an interest (other than any Borrowing Base Asset).

	18.3	 	Cashflow projections

	 	18.3.1	 	On the first day of each calendar month which occurs after August 2008, the Company
shall supply to the Agent (in sufficient copies for all the Lenders if the Agent so
requests) a monthly cashflow projection or statement relating to the projected
expenditure and income of the members of the Group in the period of 12 months
commencing on that first day of such month.

	 	18.3.2	 	Each such cashflow projection or statement must be in a form, and must contain such
information and in such level of detail, as the Agent (acting on the instructions of
all the Lenders, acting reasonably) may require.

	 	18.3.3	 	On and from the Conversion Date, the Company shall, and shall procure that each
member of the Group will:

	 	(A)	 	promptly upon receipt of the same, provide the Agent with
copies of its bank statements for the bank accounts held by it; and

	 	(B)	 	no later than three Business Days before the expiry of each
Interest Period, provide the Agent with evidence of the amounts standing to
the credit of each of the bank accounts held by it (including the Project
Accounts); and

	 	(C)	 	in any event, promptly upon request by the Agent, provide
such information as the Agent may reasonably require for the purposes of
monitoring the Obligors’ compliance with this Clause 18 (Cash sweep and
expenditure controls).

	19.	 	REPRESENTATIONS

	19.1	 	Timing of representations

	 	19.1.1	 	Each Obligor makes the representations and warranties set out in this Clause 19
(Representations) to each Finance Party on the date of this Agreement.

	 	19.1.2	 	In addition, the Repeating Representations are deemed to be made by each Obligor by
reference to the facts and circumstances then existing on:

	 	(A)	 	the date of each Utilisation Request and the first day of
each Interest Period; and

	 	(B)	 	in the case of an Additional Obligor, the day on which the
company becomes (or it is proposed that the company becomes) an Additional
Obligor.

	19.2	 	Status

	 	19.2.1	 	It, and each member of the Group party to a Transaction Document is a limited
liability company, duly incorporated and validly existing under the laws of its
jurisdiction of incorporation.

	 	19.2.2	 	It, and each member of the Group party to a Transaction Document has the power to
own its assets and carry on its business as it is being conducted.

	19.3	 	Powers and authority

It, and each member of the Group party to a Finance Document or material Project Document,
has the power to enter into and perform, and has taken all necessary action to authorise
the entry into, and performance of, the Finance Documents or material Project Documents to
which it is a party and the transactions contemplated by those Finance Documents or
material Project Documents.

	19.4	 	Legal validity

Subject to any general principles of law limiting its obligations or the obligations of any
member of the Group and specifically referred to in any legal opinion required, and
delivered to the Agent, under this Agreement, each Finance Document and, to the best of its
knowledge (after due enquiry), each material Project Document to which it, or any member of
the Group, is a party:

	 	19.4.1	 	is in full force and effect; and

	 	19.4.2	 	is its legally binding, valid and enforceable obligation or, as the case may be, the
legally binding, valid and enforceable obligation of that member of the Group,

	 	 	 
	19.5

	 	and no person is in default under any Finance Document or material Project Document.

Non-conflict

Subject to any general principles of law specifically referred to in the Norwegian legal
opinion described in paragraph 5 of Schedule 3 (Conditions precedent) the entry into and
performance by it of, or any Transaction Party of, and the transactions contemplated by,
the Finance Documents, do not conflict with:

	 	19.5.1	 	any law or regulation applicable to it or any member of the Group party to such
documents;

	 	19.5.2	 	its constitutional documents or the constitutional documents of any member of the
Group party to such documents; or

	 	19.5.3	 	any document which is binding upon (i) it or any of its assets or (ii) any member of
the Group or any assets of any member of the Group.

	19.6	 	Pari passu ranking

Its payment obligations, and the payment obligations of each Transaction Party, under the
Finance Documents rank at least pari passu with all its other present unsecured
obligations, except for obligations mandatorily preferred by law applying to companies
generally.

	19.7	 	Insolvency

As at the date of this Agreement and, in the case of any member of the Borrower Group which
does not have an interest in any Borrowing Base Asset at the date of this Agreement, the
date on which any Petroleum Asset owned by such member of the Borrower Group becomes a
Borrowing Base Asset, neither it nor any member of the Group has taken any steps, and
(after due enquiry) it is not aware of any steps having been taken for:

	 	19.7.1	 	the winding-up, administration, or dissolution of it or any member of the Group (or
any of their respective assets); or

	 	19.7.2	 	the appointment of any Insolvency Officer in relation to it or any member of the
Group or their respective assets,

	 	 	 
	19.8

	 	or any analogous step in any jurisdiction.

No default

	 	19.8.1	 	No Event of Default and, on the date of this Agreement, no Default has occurred and
is continuing or will result from the execution of, or the performance of any
transaction contemplated by, any Finance Document and so far as it is aware no
circumstances exist which threaten the foregoing.

	 	19.8.2	 	No other event is outstanding which constitutes a default under any document which
is binding on it, or any member of the Group or any of its assets or any assets of any
member of the Group, in each case, to an extent or in a manner which is reasonably
likely to result in a Material Adverse Change.

	19.9	 	Authorisations

	 	19.9.1	 	As at the date of a Finance Document and the date on which any Petroleum Asset
becomes a Borrowing Base Asset, except for registration of any relevant Security
Document, all Authorisations required by it, or any Transaction Party in connection
with the entry into, performance, validity and enforceability of, and the transactions
contemplated by, that Finance Document have been obtained or effected (as appropriate)
and are in full force and effect, and to the best of its knowledge (after due
enquiry), no steps have been or are being taken for the revocation, variation or
refusal of any such Authorisation.

	 	19.9.2	 	As at the date of this Agreement and the date on which any Petroleum Asset becomes a
Borrowing Base Asset, all material Authorisations required by it or any member of the
Group in connection with:

	 	(A)	 	the entry into, performance, validity and enforceability
of; and

	 	(B)	 	the transactions (including the exploitation of the
Borrowing Base Assets) contemplated by,

each of the material Project Documents to which it or any member of the Group is a
party have been obtained or effected (as appropriate) (or, in relation to the
matters referred to at paragraph (B) above, if not yet required, there is no
reason to believe that they will not be obtained in satisfactory terms at the time
they are required) and are in full force and effect and, to the best of its
knowledge (after due enquiry), no steps have been taken to revoke or amend such
Authorisations.

	 	19.9.3	 	As at the date of this Agreement and the date on which any Petroleum Asset becomes a
Borrowing Base Asset, all material Authorisations required by it, or any member of the
Group in connection with the exploitation of the Borrowing Base Assets as contemplated
by the Finance Documents and each Projection, have been obtained or effected (as
appropriate) and are in full force and effect and, to the best of its knowledge (after
due enquiry), no steps have been taken to revoke or amend such Authorisations.

	19.10	 	Financial statements

Its audited financial statements or, in the case of the Company, its audited consolidated
financial statements most recently delivered to the Agent:

	 	19.10.1	 	have been prepared in accordance with GAAP/IFRS, consistently applied; and

	 	19.10.2	 	give a true and fair view of its financial condition as at the date to which they
were drawn up,

	 	 	 
	19.11

19.12

	 	except, in each case, as disclosed to the contrary in those financial statements.

No Material Adverse Change

As at the date of this Agreement, there has been no Material Adverse Change.

Litigation

No litigation, arbitration or administrative proceedings are current or, to its knowledge,
pending or threatened which, if adversely determined, would be reasonably likely to result
in a Material Adverse Change.

	19.13	 	Information Package

	 	19.13.1	 	The factual information contained in the Information Package was true and accurate
in all material respects as at its date or (if appropriate) as at the date (if any) at
which it is stated to be given.

	 	19.13.2	 	The Information Package contains all information regarding each Obligor and the
Borrowing Base Assets which is material as at its date or (if appropriate) as at the
date (if any) at which it is stated to be given.

	 	19.13.3	 	The estimates, forecasts and financial projections contained in the Information
Package have been prepared, in good faith and with due care on the basis of recent
historical information and assumptions believed by the Obligors to be reasonable as at
the date it is stated to be given.

	 	19.13.4	 	Each estimate, forecast and expression of opinion or intention contained in the
Information Package was made in good faith, with due care and after careful
consideration and enquiry and is believed by the Obligors to be reasonable as at the
date at which it is stated to be given.

	 	19.13.5	 	The Information Package did not, when provided, omit any information which, if
disclosed, would make the Information Package untrue or misleading in any material
respect.

	 	19.13.6	 	As at the date of this Agreement, nothing has occurred which, if disclosed, would
make the Information Package untrue or misleading in any material respect.

	19.14	 	Security

Subject to:

	 	19.14.1	 	any qualifications as to matters of law set out in any legal opinion required, and
delivered to the Agent, under this Agreement;

	 	19.14.2	 	any required registration of any Security Document;

	 	19.14.3	 	the delivery of any notices required to be delivered pursuant to the Security
Documents which has not been delivered on the date that this representation and
warranty is, or is deemed to be, given; and

	 	19.14.4	 	any rights of forfeiture (or similar rights) of the counterparties to the Project
Documents,

each Security Document to which it or any Transaction Party is a party:

	 	(A)	 	confers the Security of the type it purports to create over
the assets over which a Security is purported to be given by that Security
Document;

	 	(B)	 	is valid and enforceable against (i) it or, as the case may
be, the relevant Transaction Party which is party thereto, and (ii) its or,
as the case may be, such Transaction Party ‘s Insolvency Officers and
creditors; and

	 	(C)	 	is not capable of being avoided or set aside, whether in
the winding up, administration, or dissolution or otherwise of it (or any of
its assets) or, as the case may be, such Transaction Party (or any such
Transaction Party’s assets).

	19.15	 	Environmental matters

	 	19.15.1	 	To the best of its knowledge (after due enquiry) it has obtained all material
Environmental Licences required by it in connection with each of the Borrowing Base
Assets in which it has an interest and their exploitation and has at all times
complied in all material respects with all those Environmental Licences and it and
each other member of the Group has complied in all material respects with all
applicable Environmental Laws.

	 	19.15.2	 	To the best of its knowledge (after due enquiry) there is no material environmental
contamination on any site connected with any Borrowing Base Asset or in which it or
any member of the Group has an interest.

	 	19.15.3	 	To the best of its knowledge (after due enquiry) there are no material
Environmental Claims current, or to its knowledge, pending or threatened, connected
with it, any member of the Group or any of the Borrowing Base Assets.

	19.16	 	Borrowing Base Assets

	 	19.16.1	 	The Obligors own, or have sufficient access to and the right to use all assets
necessary for the exploitation of each Borrowing Base Asset as contemplated by the
Transaction Documents and the then current Projection.

	 	19.16.2	 	Save as disclosed in Section C of the Due Diligence Report, to the best of its
knowledge (after due enquiry), the Obligors are the absolute legal and beneficial
owner of each Borrowing Base Asset free from any Security or other interest of any
kind (other than (i) the interests of co-venturers under the Project Documents
relating to that Borrowing Base Asset, (ii) the Security under the Security Documents
or (iii) the Security permitted under Clause 21.4 (Negative pledge)) and no member of
the Group is under any obligation to create any Security over any Borrowing Base Asset
(except by virtue of any Security Document or as permitted under Clause 21.4 (Negative
pledge)).

	 	19.16.3	 	So far as it is aware, no event or circumstance exists which entitles any person to
terminate or suspend any Authorisation of a kind referred to in Clause 19.9.2
(Authorisations).

	19.17	 	Copies of Project Documents

Save as disclosed in Section A of the Due Diligence Report, each copy of a Project Document
delivered to the Agent by it is, at the time it is delivered, a correct and complete copy
of the relevant document as in force at that time.

	19.18	 	Laws and regulations

Subject to any general principles of law specifically referred to in the Norwegian legal
opinion described in paragraph 5 of Schedule 3 (Conditions precedent) it and each member of
the Group, is in compliance in all material respects with all applicable laws and
regulations including any applicable tax laws and regulations. This implies that Dutch
Financial Supervision Act (Wet op het financieel toezicht) is also applicable.

	19.19	 	Insurances

	 	19.19.1	 	All Insurances which are at any time required to be maintained or effected by it,
or any member of the Group, pursuant to the Finance Documents are in full force and
effect at that time, and to the best of its knowledge (after due enquiry), no event or
circumstance has occurred, nor has there been any omission to disclose a fact, which
would in either case entitle any insurer under those Insurances to avoid its liability
or otherwise reduce its liability.

	 	19.19.2	 	The Security Trustee (as security trustee for the Secured Creditors) will, on and
from the first Utilisation Date, be named as co-insured in relation to all such
Insurances.

	19.20	 	No immunity

	 	19.20.1	 	It, and each member of the Group party to a Transaction Document is subject to
civil commercial law in respect of its obligations under the Transaction Documents.

	 	19.20.2	 	None of it, any other member of the Group party to a Transaction Document, any of
its assets, or any assets of any other member of the Group party to a Transaction
Document, is entitled to any right of immunity, and the entry into and performance by
it, and each member of the Group party to a Transaction Document, of the Transaction
Documents to which it or, as the case may be, that member of the Group, is a party
constitute private and commercial acts.

	19.21	 	Governing law and enforcement

Subject to any qualifications as to matters of law set out in any legal opinion required,
and delivered to the Agent, under this Agreement:

	 	19.21.1	 	the relevant law chosen as the governing law of each of the Finance Documents to
which it, or any member of the Group, is a party will be recognised and enforced in
its jurisdiction of incorporation or, as the case may be, the jurisdiction of
incorporation of such member of the Group;

	 	19.21.2	 	the submission by it, or any member of the Group, to the jurisdiction of the courts
of England under any relevant Finance Document to which it or, as the case may be,
such member of the Group, is a party and any undertaking given in any Finance Document
by it, or any member of the Group, not to claim any immunity, in each case, is legal,
valid and binding under the law of its jurisdiction of incorporation or, as the case
may be, the jurisdiction of incorporation of such member of the Group; and

	 	19.21.3	 	any judgment obtained in England in relation to a Finance Document to which it, or
any member of the Group, is a party will be recognised and enforced in its
jurisdiction of incorporation or, as the case may be, the jurisdiction of
incorporation of such member of the Group.

	19.22	 	Deduction of Tax

As at the date of this Agreement it is not required under the law of its jurisdiction of
incorporation to make any deduction for or on account of Tax from any payment that it may
make under any Finance Document.

	19.23	 	Ownership structure

	 	19.23.1	 	As at the date of this Agreement, each of the Company’s Subsidiaries, apart from
Endeavour Energy Luxembourg S.a.r.l, Endeavour Energy North Sea and Endeavour Energy
Norge AS are Original Guarantors.

	 	19.23.2	 	As at the date of this Agreement, the ownership structure of the Group is as set
out in Schedule 8 (Group Structure).

	19.24	 	No Security

No Security (or agreement to create the same) exists over any of its assets or any assets
of any member of the Group save, in each case, as permitted under Clause 21.4 (Negative
pledge).

	19.25	 	Share Security

Each member of the Group that has entered into any Security Document for the purposes of
granting Security over its shares in another member of the Group is the legal and
beneficial owner of all of such shares and other assets (the “charged assets") secured, or
purported to be secured, under such Security Document free from any Security (other than
the relevant Security created pursuant to that Security Document); and the charged assets
are free from any restrictions as to transfer or registration and are not subject to any
calls or other liability to pay money.

	19.26	 	Dutch Work’s Council Act

None of the Obligors incorporated in The Netherlands is required to obtain advice from any
works council within the meaning of the Dutch Works Council Act (Wet op de
Ondernemingsraden).

	19.27	 	Final Salary Pension Schemes

No member of the Group has at any time operated a final salary pension scheme.

	20.	 	INFORMATION UNDERTAKINGS

	20.1	 	Financial statements

	 	20.1.1	 	The Company must supply to the Agent (in sufficient copies for all the Lenders if
the Agent so requests):

	 	(A)	 	its audited consolidated financial statements for each of
its financial years; and

	 	(B)	 	its unaudited consolidated financial statements for each
six month period in each of its financial years.

	 	20.1.2	 	In addition, if the Agent so requests, each Obligor (other than the Company) must
supply to the Agent (in sufficient copies for all the Lenders if the Agent so
requests):

	 	(A)	 	its financial statements (or, if the same have been
audited, audited financial statements) for each of its financial years; and

	 	(B)	 	its unaudited financial statements for each six month
period in each of its financial years.

	 	20.1.3	 	All financial statements for any financial year ending on or after 31st December
2005 must be supplied as soon as they are available and:

	 	(A)	 	in the case of audited financial statements or audited
consolidated financial statements of the Company, within 120 days;

	 	(B)	 	in the case of audited financial statements or audited
consolidated financial statements of each Obligor (other than the Company),
within 180 days or, in the case only of Endeavour Energy UK Limited or any
other Obligor incorporated in England and Wales, 304 days;

	 	(C)	 	in the case of unaudited financial statements or unaudited
consolidated financial statements of the Company, within 90 days; and

	 	(D)	 	in the case of unaudited financial statements or unaudited
consolidated financial statements of each Obligor (other than the Company),
within 120 days,

of the end of the relevant financial period.

	 	20.1.4	 	The Company must supply to the Agent, with each set of financial statements it
supplies in accordance with Clause 20.1.2 and Clause 20.1.3, a certificate signed by a
director of the Company (in form satisfactory to the Agent) demonstrating the
compliance of the Group with Clause 22 (Financial Covenants) or, if it is not in
compliance, stating this fact together with a brief explanation therefor.

	20.2	 	Form of financial statements

	 	20.2.1	 	Each Obligor must ensure that each set of financial statements supplied under this
Agreement is prepared using GAAP/IFRS and gives (if audited) a true and fair view of,
or (if unaudited) fairly represents, the financial condition (consolidated or
otherwise) of the relevant person as at the date and for the period in respect of
which those financial statements were drawn up.

	 	20.2.2	 	Each Obligor must notify the Agent of any change to GAAP/IFRS, accounting practices
or reference periods which affect the basis on which its audited consolidated
financial statements or audited financial statements are prepared.

	 	20.2.3	 	If requested by the Agent, the relevant Obligor must supply to the Agent:

	 	(A)	 	a full description of any change notified under Clause
20.2.2; and

	 	(B)	 	sufficient information to enable the Finance Parties to
make a proper comparison between the financial position shown by the set of
financial statements prepared on the changed basis and its most recent
audited consolidated financial statements or, as the case may be, audited
financial statements delivered to the Agent under this Agreement.

	 	20.2.4	 	If requested by the Agent, the Company must enter into discussions for a period of
not more than 30 days with a view to agreeing any amendments required to be made to
this Agreement to place the relevant Obligor and the Finance Parties in the same
position as they would have been in if the change notified under Clause 20.2.2 had not
happened. Any agreement between the Company and the Agent will, with the prior
consent of the Majority Lenders, be binding on all the Parties.

	 	20.2.5	 	If no agreement is reached under Clause 20.2.4 on the required amendments to this
Agreement, the Company must ensure that its auditors certify those amendments required
to be made to this agreement to place the relevant Obligor and the Finance Parties in
the same position as they would have been in if the change notified under Clause
20.2.2 had not happened. The certificate of the auditors will, in the absence of
manifest error, be binding on all the Parties.

	20.3	 	Information: miscellaneous

Each Obligor must supply, and the Company must procure that each member of the Group
supplies, to the Agent (in sufficient copies for all the Lenders if the Agent so requests):

	 	20.3.1	 	copies of all documents dispatched by it to its creditors generally or any class of
them or required by its constitutional documents or law to be dispatched to its
shareholders (or any class of them) in their capacity as such, in each case, at the
same time as they are dispatched;

	 	20.3.2	 	promptly upon becoming aware of them, details of any litigation, arbitration or
administrative proceedings relating to it which are current, threatened or pending
which, if adversely determined, is reasonably likely to result in a Material Adverse
Change;

	 	20.3.3	 	promptly upon becoming aware of them, details of any potential or actual material
warranty claim or any other material claim or dispute relating to it under any
Transaction Document;

	 	20.3.4	 	promptly upon becoming aware of it, any incident involving any material physical
damage to a Borrowing Base Asset in which it has an interest and its proposal for
reinstatement;

	 	20.3.5	 	promptly upon changing its financial year end, details of the same; and

	 	20.3.6	 	promptly on request, such further information regarding its financial condition and
operations as any Finance Party through the Agent may reasonably request.

	20.4	 	Information: Borrowing Base Assets

The Company shall supply to the Agent (in sufficient copies for all of the Lenders if the
Agent so requests):

	 	20.4.1	 	promptly upon receipt by it or any member of the Group, a copy of:

	 	(A)	 	any production reports, budgets prepared by any operator,
any minutes of operating committee meetings or any other document as the
Agent may reasonably request from time to time, in each case, relating to any
Borrowing Base Asset; and

	 	(B)	 	any other information relating to a Borrowing Base Asset or
a member of the Group that could change any Assumption in the then current
Projection (in a material respect) or impose any additional material
liability on any member of the Group;

	 	20.4.2	 	promptly upon request by the Agent:

	 	(A)	 	a copy of any Project Document; and

	 	(B)	 	such information as the Lenders may reasonably require in
respect of a Borrowing Base Asset or any member of the Group;

	 	20.4.3	 	not less than 14 days before any member of the Group enters into any new material
Project Document or any material amendment to any existing Project Document, details
of that Project Document or material amendment; and

	 	20.4.4	 	promptly upon receipt by an Obligor, or any member of the Group, a certified copy of
any material Authorisation required under any law or regulation (including
Environmental Laws and Environmental Licences) to enable that Obligor or member of the
Group to perform its obligations under, or for the validity or enforceability of, any
Finance Document.

	20.5	 	Notification of Default

	 	20.5.1	 	Unless the Agent has already been so notified, an Obligor shall, as soon as it
becomes aware, promptly notify the Agent of any Default (and the steps, if any, being
taken to remedy it).

	 	20.5.2	 	Promptly on request by the Agent and together with the financial statements
specified in Clause 20.1.2(A) (Financial statements), each Obligor must supply to the
Agent a certificate, signed by two of its authorised signatories on its behalf,
certifying that no Default is outstanding or, if a Default is outstanding, specifying
the Default and the steps, if any, being taken to remedy it.

	20.6	 	Use of websites

	 	20.6.1	 	Except as provided below, an Obligor may deliver any information under the Finance
Documents to a Lender by posting it on to an electronic website if:

	 	(A)	 	the Agent and the relevant Obligor agree;

	 	(B)	 	the relevant Obligor and the Agent designate an electronic
website for this purpose;

	 	(C)	 	both the relevant Obligor and the Agent are aware of the
address of and any relevant password specifications for the website; and

	 	(D)	 	the information posted is in a format agreed between the
relevant Obligor and the Agent.

The Agent must supply each relevant Lender with the address of and any relevant
password specifications for the website.

	 	20.6.2	 	Notwithstanding the above, each relevant Obligor must supply to the Agent in paper
form a copy of any information posted on the website together with sufficient copies
for each Lender:

	 	(A)	 	if requested to do so by the Agent; or

	 	(B)	 	if so required by a governmental requirement,

in each case within 10 Business Days of receipt of the request.

	 	20.6.3	 	The Agent must promptly upon becoming aware of its occurrence, notify the relevant
Obligor and the Lenders if:

	 	(A)	 	the website cannot be accessed;

	 	(B)	 	the website or any information on the website is infected
by any electronic virus or similar software;

	 	(C)	 	the relevant password specification for the website is
changed; or

	 	(D)	 	any information to be supplied under this Agreement is
posted on the website or amended after being posted.

In the circumstances in paragraphs (A) or (B) above occur, the relevant Obligor
must supply any information required under this Agreement in paper form.

	 	 	 	 	 	 	 
	20.7	 	"Know your customer" checks
	
 
	 	 	20.7.1	 	 	If:

	 	(A)	 	the introduction of or any change in (or in the
interpretation, administration or application of) any law or regulation made
after the date of this Agreement;

	 	(B)	 	any change in the status, or the composition of the
shareholders, of an Obligor after the date of this Agreement; or

	 	(C)	 	a proposed assignment or transfer by a Lender of any of its
rights and obligations under this Agreement to a party that is not a Lender
prior to such assignment or transfer,

obliges the Agent or any other Finance Party (or, in the case of Clause 20.7.1(C)
above, any prospective new Lender) to comply with “know your customer” or similar
identification procedures in circumstances where the necessary information is not
already available to it, each Obligor shall promptly upon the request of the Agent
or any Finance Party supply, or procure the supply of, such documentation and
other evidence as is reasonably requested by the Agent (for itself or on behalf of
any Finance Party) or any Finance Party (for itself or, in the case of the event
described in Clause 20.7.1(C) above, on behalf of any prospective new Lender) in
order for the Agent, such Finance Party or, in the case of the event described in
Clause 20.7.1(C) above, any prospective new Lender to carry out and be satisfied
it has complied with all necessary “know your customer” or other similar checks
under all applicable laws and regulations pursuant to the transactions
contemplated in the Finance Documents.

	 	20.7.2	 	Each Finance Party shall promptly upon the request of the Agent supply, or procure
the supply of, such documentation and other evidence as is reasonably requested by the
Agent (for itself) in order for the Agent to carry out and be satisfied it has
complied with all necessary “know your customer” or other similar checks under all
applicable laws and regulations pursuant to the transactions contemplated in the
Finance Documents.

	 	20.7.3	 	The Company shall, by not less than 10 Business Days’ prior written notice to the
Agent, notify the Agent (which shall promptly notify the Finance Parties) of its
intention to request that any Relevant Affiliate becomes an Additional Obligor
pursuant to Clause 25 (Changes to the Obligors).

	 	20.7.4	 	If the accession of any person to this Agreement as an Additional Obligor pursuant
to Clause 25 (Changes to the Obligors) obliges the Agent or any other Finance Party to
comply with “know your customer” or similar identification procedures in circumstances
where the necessary information is not already available to it, the Company shall
promptly upon the request of the Agent or any other Finance Party supply, or procure
the supply of, such documentation and other evidence as is reasonably requested by the
Agent (for itself or on behalf of any Finance Party) or any other Finance Party (for
itself or on behalf of any prospective new Finance Party) in order for the Agent or
such Finance Party or any prospective new Finance Party to carry out and be satisfied
it has complied with the results of all necessary “know your customer” or other
similar checks under all applicable laws and regulations pursuant to the accession of
such person to this Agreement as an Additional Obligor.

	20.8	 	Permitted Transactions

Each Obligor shall consult with the Agent prior to completing any Permitted Transaction
described in paragraph (B) or (C) of the definition of “Permitted Transaction” set out in
Clause 1.1 (Definitions) and promptly notify the Agent upon the completion of the same.
The Obligors shall provide such evidence as the Agent (acting reasonably) may request for
the purposes of ensuring that each such Permitted Transaction has been or, as the case may
be, will be, completed upon the terms described in the relevant paragraph of the definition
of “Permitted Transaction” and that the interests of the Secured Creditors have not been
adversely affected.

	21.	 	GENERAL UNDERTAKINGS

	21.1	 	Authorisations

Each Obligor shall, and shall procure that each member of the Group shall, promptly obtain,
maintain and comply with the terms of any material Authorisation required under any law or
regulation (including Environmental Laws and Environmental Licences):

	 	21.1.1	 	to enable it to perform its obligations (or exercise its rights) under, or for the
validity or enforceability of, any Finance Document; or

	 	21.1.2	 	to enable it to perform its obligations (or exercise its rights) under, or for the
validity or enforceability of, any other Finance Document or material Project Document
to which it is party or for the exploitation and/or operation of any Borrowing Base
Asset in which it has an interest as contemplated by the Finance Document or material
Project Document and the then current Projection.

	21.2	 	Compliance with laws

Each Obligor shall, and shall procure that each member of the Group shall, comply in all
material respects with all laws and regulations applicable to it or its assets or
activities for the time being.

	21.3	 	Pari passu ranking

Each Obligor shall, and shall procure that each member of the Group party to a Finance
Document, shall ensure that its obligations under the Finance Documents rank at least pari
passu with all its other present and future unsecured obligations, except for obligations
mandatorily preferred by law applying to companies generally.

	 	 	 	 	 	 	 
	21.4	 	Negative pledge
	
 
	 	 	21.4.1	 	 	Except as provided in Clause 21.4.2:

	 	(A)	 	no Obligor may create or allow to exist any Security on,
over, or affecting, any of its assets; and

	 	(B)	 	each Obligor shall procure that no member of the Group
creates or allows to exist any Security on, over, or affecting, any of its
assets.

	 	21.4.2	 	Clause 21.4.1 does not apply to:

	 	(A)	 	any Security constituted by the Security Documents or
arising under any other Finance Document (including any such Security that
has been granted by the obligors under the First Lien Credit Agreement);

	 	(B)	 	any Security comprising a netting or set-off arrangement
entered into by an Obligor or any other member of the Group:

	 	(1)	 	in the ordinary course of its banking and
trading arrangements for the purpose of netting debit and credit
balances;

	 	(2)	 	under any Permitted Hedging Agreement; or

	 	(3)	 	under any other Hedging Agreement to which
any member of the Group that is not an Obligor is a party;

	 	(C)	 	any lien arising by operation of law and in the ordinary
course of trading and does not secure any amount more than 30 days overdue;

	 	(D)	 	any Security that arises under or pursuant to a Project
Document which does not secure any Financial Indebtedness;

	 	(E)	 	any Security that are retention of title or set off
arrangements constituted under industry standard conditions for the supply of
goods acquired by any Obligor or any other member of the Group in the
ordinary course of its trading;

	 	(F)	 	any Security arising pursuant to the specific terms of any
Equivalent Field Document which does not secure any Financial Indebtedness;

	 	(G)	 	any Security which the Majority Lenders have consented to
in writing;

	 	(H)	 	any Security securing Financial Indebtedness, the
outstanding principal amount of which (when aggregated with the outstanding
principal amount of any other Financial Indebtedness which has the benefit of
any Security given by any member of the Group other than permitted under
paragraphs 21.4.2(A) to 21.4.2(G) above) does not exceed $250,000 (or its
equivalent in other currencies).

	 	21.4.3	 	No Obligor may, and each Obligor shall procure that no member of the Group shall:

	 	(A)	 	sell, transfer or otherwise dispose of any of its assets on
terms where it is or may be leased to or re-acquired or acquired by that
company or any member of the Group or Non Recourse Subsidiary; or

	 	(B)	 	sell, transfer or otherwise dispose of any of its
receivables on recourse terms,

in circumstances where the transaction is entered into primarily as a method of
raising Financial Indebtedness or of financing the acquisition of an asset.

	 	21.4.4	 	No Obligor may, and each Obligor shall ensure that no member of the Group shall,
agree to an amendment of any document or enter into a document which may restrict its
ability to create a Security envisaged by a Security Document.

	21.5	 	Disposals

	 	21.5.1	 	Except as provided in Clause 21.5.2, no Obligor may, and each Obligor shall procure
that no member of the Group shall, either in a single transaction or in a series of
transactions and whether related or not, dispose of all or any part of any Borrowing
Base Asset or any interests therein or any of its shareholding in any person holding
any interest in any Borrowing Base Assets.

	 	21.5.2	 	Clause 21.5.1 does not apply to:

	 	(A)	 	sales of Petroleum under any Project Document or otherwise
on arms’ length terms for cash-only consideration;

	 	(B)	 	disposals arising solely by virtue of a unitisation or
redetermination of a Borrowing Base Asset;

	 	(C)	 	disposals of surplus materials or of materials that are
forthwith replaced with materials of equivalent utility;

	 	(D)	 	disposals of obsolete or surplus assets;

	 	(E)	 	disposals of materials used in the course of its operations
where such disposals are made in the ordinary course of business and on arms’
length terms;

	 	(F)	 	disposals of a Petroleum Asset which has ceased to be
designated as a Borrowing Base Asset pursuant to the First Lien Credit
Agreement or any other Petroleum Asset (provided, in each case, that the
proceeds of such disposal are applied in repayment of the Loans in accordance
with Clause 7.3 (Mandatory prepayment));

	 	(G)	 	any step which is part of a Permitted Transaction;

	 	(H)	 	disposals with prior consent of the Majority Lenders;

	 	(I)	 	any step which is part of a Permitted Hedging Agreement.

	21.6	 	Financial Indebtedness

	 	21.6.1	 	Except as provided in Clause 21.6.2, no Obligor may, and each Obligor shall procure
that no member of the Group shall, at any time incur or have outstanding any Financial
Indebtedness.

	 	21.6.2	 	Clause 21.6.1 does not apply to:

	 	(A)	 	any Financial Indebtedness incurred under the Finance
Documents or;

	 	(B)	 	any Financial Indebtedness accruing under the $81,250,000
convertible senior notes due 2012 of Endeavour International Corporation and
any Financial Indebtedness incurred under any arrangement (“refinancing
arrangements") entered into for the purposes of refinancing and repaying the
Financial Indebtedness incurred under such convertible senior notes (provided
that (i) the aggregate principal amount of the Financial Indebtedness under
such refinancing arrangements and (to the extent that the Financial
Indebtedness incurred under such convertible senior notes is only refinanced
in part) any outstanding Financial Indebtedness under such convertible senior
notes, does not exceed $81,250,000 and (ii) no payments of principal are
payable under the refinancing arrangements before the Final Maturity Date);

	 	(C)	 	Financial Indebtedness incurred under any Permitted Hedging
Agreement or any guarantee given by a member of the Group in respect of a
Permitted Hedging Agreement;

	 	(D)	 	any Financial Indebtedness owed by an Obligor to another
Obligor;

	 	(E)	 	any Financial Indebtedness which is subordinated to amounts
due to the Finance Parties under the Finance Documents pursuant to a
subordination agreement approved by the Majority Lenders;

	 	(F)	 	any Financial Indebtedness incurred under the Existing
Second Lien Facility (provided that the same is repaid and discharged in its
entirety from the proceeds of the Loans and the convertible loan notes
described in Clause 21.6.2(G), and the credit facilities thereunder are
cancelled in their entirety, in each case, on the first Utilisation Date);

	 	(G)	 	any Financial Indebtedness incurred under the $40,000,000
11.5% unsecured convertible loan notes due 2014 issued by Endeavour Energy
Luxembourg S.a.r.l (provided that no payments of interest or principal under
such notes are payable before the Final Maturity Date);

	 	(H)	 	any Financial Indebtedness incurred under the First Lien
Credit Agreement provided that the aggregate principal amount of the
Financial Indebtedness under the First Lien Credit Agreement does not exceed
$225,000,000;

	 	(I)	 	any Financial Indebtedness incurred other than under
Clauses 21.6.2(A) to 21.6.2(H) which does not at any time exceed (in
aggregate) $10,000,000 (or its equivalent in one or more other currencies);
and

	 	(J)	 	any other Financial Indebtedness incurred with the prior
consent of the Majority Lenders.

	21.7	 	Credits and guarantees

	 	21.7.1	 	Except as provided in Clause 21.7.2, no Obligor may, and each Obligor shall procure
that no member of the Group shall, make any loan or extend any other form of credit or
financial accommodation, or give any guarantee of any person’s Financial Indebtedness,
to any person, or otherwise be a creditor in respect of any Financial Indebtedness of
any person.

	 	21.7.2	 	Clause 21.7.1 does not apply to:

	 	(A)	 	any loan, credit or financial accommodation to the extent
required by or pursuant to any Project Document or any Equivalent Field
Document;

	 	(B)	 	trade credit and guarantees on usual commercial terms
including guarantees by a member of the Group of oil and gas trading
obligations of any other member of the Group;

	 	(C)	 	the guarantee given by the Company to Paladin Resources
Limited under the terms of the Acquisition Agreement;

	 	(D)	 	any Financial Indebtedness permitted under Clause 21.6.2;

	 	(E)	 	the guarantees given by the Obligors under Article XII of
the Existing Second Lien Facility (provided that credit facilities thereunder
are repaid and discharged in their entirety from the proceeds of the Loans
and the convertible loan notes described in Clause 21.6.2(G), and cancelled
in their entirety, in each case, on the first Utilisation Date);

	 	(F)	 	any extension of credit given pursuant to a Permitted
Hedging Agreement in relation to hedge receipts.

	21.8	 	Change of business

	 	21.8.1	 	Each Obligor shall procure that no substantial change is made to the general nature
of its business or the business of the Group from that carried on at the date of this
Agreement.

	 	21.8.2	 	No Obligor shall:

	 	(A)	 	carry on any business other than the ownership and
exploitation of interests in Petroleum Assets and the exploration for, and
production and disposal of Petroleum from, the areas covered by the petroleum
production licences for such Petroleum Assets and activities associated with
those activities; or

	 	(B)	 	own any assets or incur any liabilities except for the
purposes of carrying on that business.

	21.9	 	Corporate existence

	 	21.9.1	 	Each Obligor shall maintain, and shall ensure that each member of the Group
maintains, its corporate existence under the laws of its jurisdiction of incorporation
and each Obligor shall not, and shall ensure that no member of the Group will, change
its corporate domicile, or attempt to resolve to do so.

	 	21.9.2	 	No Obligor may, and each Obligor shall procure that no member of the Group shall,
enter into any amalgamation, demerger, merger or reconstruction except a solvent
amalgamation, demerger, merger or reconstruction within the Group with the consent of
the Majority Lenders (such consent not to be unreasonably withheld).

	 	21.9.3	 	The restrictions in Clauses 21.9.1 and 21.9.2 shall not apply to any step or
procedure which is part of a Permitted Transaction.

	21.10	 	Environmental matters

	 	21.10.1	 	Each Obligor shall ensure that it, and the Company shall procure that each member
of the Group is, and has been, in compliance in all material respects with all
Environmental Laws and Environmental Licences applicable to it.

	 	21.10.2	 	Each Obligor shall, and the Company shall procure that each member of the Group,
shall promptly upon becoming aware of the same notify the Agent of:

	 	(A)	 	any material Environmental Claim current, or to its
knowledge, pending or threatened; or

	 	(B)	 	any circumstances reasonably likely to result in an
Environmental Claim.

	21.11	 	Insurance

	 	21.11.1	 	Each Obligor shall, and the Company shall procure that each member of the Group
shall:

	 	(A)	 	take out and maintain, or caused to be taken out and
maintained, with respect to all of its assets and activities, insurance
policies:

	 	(1)	 	in such amounts and on such terms and
against such risks as are normally insured against by prudent owners
of comparable assets in the region in which the relevant assets are
located or activities are taking place; and

	 	(2)	 	against any other risks which the Agent may
reasonably require as a result of any material change(s) in
circumstances, risks or the Majority Lenders’ reasonable perception
of risk.

	 	(B)	 	ensure that each Insurance is maintained:

	 	(1)	 	with an insurance company or underwriters
acceptable to the Agent (acting reasonably); and

	 	(2)	 	otherwise on terms consistent with the good
practice of prudent owners of comparable assets;

	 	(C)	 	ensure that moneys received by it under any Insurances
relating to third party liability are applied directly to the person to whom
the liability to which the sum relates was incurred, or to the relevant
insured party in reimbursement of moneys expended in satisfaction of such
liability;

	 	(D)	 	procure that the Security Trustee (as security trustee for
the Secured Creditors is, on and from the first Utilisation Date, named as a
co-insured party upon the policy, certificate or cover note relating to each
Insurance;

	 	(E)	 	not do, or knowingly permit anything to be done, which may
make any Insurance void, voidable, unavailable or unenforceable or render any
sum which may be paid out under such insurance repayable in whole or in part;

	 	(F)	 	promptly pay all premiums, calls and contributions and do
all other things necessary to keep each Insurance maintained in full force
and effect;

	 	(G)	 	produce to the Agent (i) the policy, certificate or cover
note relating to any Insurance, (ii) the receipt for payment of any premium
for any Insurance or (iii) such other details of any Insurance as the Agent
may reasonably request; and

	 	(H)	 	if the Security Trustee so requires:

	 	(1)	 	enter into a Security Document (in form and
substance satisfactory to the Security Trustee) for the purposes of
granting Security over such Insurances which relate to the Borrowing
Base Assets and the proceeds thereof in favour of the Security
Trustee unless such Security has been granted under an existing
Security Document; and

	 	(2)	 	deliver to the Security Trustee, or procure
the delivery to the Security Trustee of, any legal opinion or other
document that the Security Trustee may reasonably require in
connection with the entry into such Security Document.

	 	21.11.2	 	No Finance Party shall have any liability for the payment of premiums or any other
amount owing in respect of any insurance.

	 	21.11.3	 	If any Obligor or member of the Group fails to pay any premium relating to any
Insurances, the Agent may, at its sole discretion, pay any premium due and the
Obligors shall immediately pay to the Agent the amount of such premium.

	21.12	 	Project Documents

Each Obligor shall:

	 	21.12.1	 	ensure that none of its rights under or in respect of any Project Document are at
any time cancelled, terminated, suspended or limited if the same would be reasonably
likely to result in a Material Adverse Change;

	 	21.12.2	 	not agree to any waiver, amendment, termination or cancellation of any Project
Document if the same would be reasonably likely to result in a Material Adverse
Change;

	 	21.12.3	 	duly and properly perform, in all material respects, its obligations under the
Project Documents (except to the extent, if any, they are inconsistent with its
obligations under the Finance Documents);

	 	21.12.4	 	exercise its rights, and (so far as within its power) ensure that others exercise
their respective rights, under and in respect of the Project Documents consistently
with its obligations under the Finance Documents; and

	 	21.12.5	 	not enter into any Project Document the entry into, performance, termination or
breach of which would be reasonably likely to result in a Material Adverse Change.

	21.13	 	Borrowing Base Assets

Each Obligor shall:

	 	21.13.1	 	exercise such votes and other rights as it may have under the Project Documents
with a view to ensuring (so far as it is able) that each Borrowing Base Asset is at
all times exploited and operated in a reasonable and prudent manner and in accordance
with good industry practice, all applicable laws and regulations and the provisions of
the Project Documents;

	 	21.13.2	 	prior to the Abandonment Date forecast in the then current Projection, not concur
in, and shall vote against, any proposal or decision to abandon all or any material
part of any of its Borrowing Base Assets unless the Agent has received a copy of any
confirmation provided by the technical bank under the First Lien Credit Agreement to
the Company confirming that if a new Projection (reflecting such an abandonment) were
to be adopted, the same would not result in the Borrowers having to reduce the
utilisations under the First Lien Credit Agreement in accordance with the first First
Lien Credit Agreement following the adoption of that Projection;

	 	21.13.3	 	not exercise its rights on any operating or similar committee in a manner that
would be materially prejudicial to the interests of any Finance Party under the
Finance Documents; and

	 	21.13.4	 	maintain full and proper technical and financial records in relation to each of its
Borrowing Base Assets, and ensure (so far as it is able) that the Agent (and/or any
person nominated by it) is afforded reasonable access to each of its Borrowing Base
Assets and all such records during normal business hours on reasonable notice.

	 	 	 	 	 	 	 
	21.14	 	Taxes	 	 
	 	 	Each Obligor shall, and the Company shall procure that each member of the Group shall:
	
 
	 	 	21.14.1	 	 	maintain its tax residence in the relevant country of incorporation;

	 	21.14.2	 	procure that all Taxes payable by, or assessed upon, it are paid when due save to
the extent that such payment is being contested in good faith and being lawfully
withheld;

	 	21.14.3	 	to the fullest extent it is able to do so, apply any and all tax credits, losses,
reliefs or allowances taken into account in any Projection at any time in the manner,
at the time and to the extent that they were so taken into account;

	 	21.14.4	 	not surrender or dispose of any tax credit, loss, relief or allowance to any person
other than an Obligor; and

	 	21.14.5	 	file all tax returns required to be filed by it in any jurisdiction within the
period required by law.

	21.15	 	Syndication

Each Obligor shall, provide all reasonable assistance to the Mandated Lead Arrangers and
the Finance Parties in effecting the primary syndication of the Facility, including by:

	 	21.15.1	 	providing such information available to it as may be required by the Mandated Lead
Arrangers or any Lender (acting reasonably) in connection with syndication of the
Facility (including in connection with the preparation, revision and approval of an
information memorandum in connection with the primary syndication);

	 	21.15.2	 	making management and members of staff available at reasonable times and on
reasonable notice for the purposes of making presentations to potential lending
institutions; and

	 	21.15.3	 	otherwise assisting the Mandated Lead Arrangers or any Lenders, to the extent
reasonably necessary to achieve the successful syndication of the Facility.

	21.16	 	Security Documents

	 	21.16.1	 	Save as disclosed in Section D of the Due Diligence Report and save, for any
registration of the Security Documents which is to be undertaken by the Lenders’ legal
counsel, each Obligor shall, and shall ensure that each member of the Group party to
any Security Document shall, take all such steps (including the obtaining and/or
carrying out of all relevant approvals, filings, registrations or recordings) as are
available to it and as are reasonably necessary for the purposes of ensuring that each
Security Document:

	 	(A)	 	confers the Security of the type it purports to create over
the assets over which a Security is purported to be given by that Security
Document;

	 	(B)	 	is valid and enforceable against the relevant member of the
Group which is party thereto and such Group member’s Insolvency Officers and
creditors; and

	 	(C)	 	is not capable of being avoided or set aside, whether in
the winding up, administration or dissolution or otherwise of such member of
the Group.

	 	21.16.2	 	Without prejudice to Clause 21.16.1 each Obligor shall, and shall ensure that each
member of the Group party to any Security Document shall, promptly pay all stamp,
registration and similar taxes and fees that are payable in connection with each
Security Document to which it is a party.

	21.17	 	Petroleum won and saved

Each Obligor shall use all reasonable endeavours to procure that all Petroleum won and
saved from any Borrowing Base Asset and which it is entitled to lift is dealt with in
accordance with good commercial practice and is sold (whether pursuant to a spot or term
contract) on the best terms (as to price and otherwise) as are reasonably available to
companies of comparable standing to the relevant Obligor at the date the relevant contract
is entered into.

	21.18	 	Ownership

The Company must (subject only to any Security constituted under any Security Document) at
all times beneficially and legally own (whether directly or indirectly) the whole of the
issued share capital of each Obligor (other than itself).

	21.19	 	Distributions

	 	21.19.1	 	At any time after the Conversion Date, no Obligor shall, and the Company shall
ensure that no member of the Group shall, make or pay, or permit to be made or paid,
any dividend or distribution (whether in cash or in kind) in relation to its share
capital, any redemption or reduction of any share capital, any payments in respect of
any loans made available to it by any Affiliate or any other distribution to any of
its shareholders save for any of the foregoing in and among or to the Obligors and any
dividend or distribution that has been declared prior to the occurrence of the
Conversion Date.

	 	21.19.2	 	No Obligor may, and each Obligor shall ensure that no member of the Group will,
agree to any arrangement (other than the Finance Documents or the First Lien Credit
Agreement) which may restrict its ability to declare, make or pay any dividend,
distribution or any payments referred to in Clause 21.19.1.

	 	21.19.3	 	On and from the Conversion Date, no Obligor may, and each Obligor shall ensure that
no member of the Group will, make or pay any dividend or distribution in relation to
its share capital in cash.

	21.20	 	Hedging

	 	21.20.1	 	Each Obligor shall comply with the requirements of the First Lien Credit Agreement
with respect to the entry into any Hedging Agreements.

	 	21.20.2	 	Promptly upon request, the Company shall provide to the Agent a report (in a form
satisfactory to the Agent, acting reasonably) which confirms whether the Obligors are
in compliance with such requirements of the First Lien Credit Agreement.

	 	21.20.3	 	No Obligor may enter into any Hedging Agreement unless:

	 	(A)	 	such Hedging Agreement has been entered into pursuant to
Clause 21.20.1 in connection with the Borrowing Base Assets;

	 	(B)	 	such Hedging Agreement has been entered into with a Hedging
Bank or such other hedging counterparty that has a credit rating of at least
A3 with Moody’s Investors Service Inc. or A- with Standard and Poor’s Rating
Group or such other lower credit rating as may be acceptable to the Majority
Lenders; and

	 	(C)	 	in the case of any such Hedging Agreement with a Hedging
Bank, that Hedging Agreement has been entered into in compliance with the
Intercreditor Agreement.

	 	21.20.4	 	Each Obligor that enters into a Hedging Agreement on or after the date of this
Agreement shall:

	 	(A)	 	enter into a Security Document in form and substance
satisfactory to the Security Trustee for the purposes of granting Security
over that Hedging Agreement in favour of the Security Trustee unless Security
over such Hedging Agreement has been granted to the Security Trustee under
any existing Security Document;

	 	(B)	 	without prejudice to Clause 21.16 (Security Documents),
promptly obtain all such Authorisations as may be necessary in order for such
Security to be granted; and

	 	(C)	 	deliver to the Security Trustee, or procure the delivery to
the Security Trustee of, any legal opinion or other document that the
Security Trustee may reasonably require in connection with the entry into
such Security Document.

	 	21.20.5	 	Save for:

	 	(A)	 	any Security that is permitted to be granted pursuant to
Clause 21.4 (Negative pledge) in respect of any such Hedging Agreement; and

	 	(B)	 	any guarantee that is permitted pursuant to Clause 21.6
(Financial Indebtedness) and Clause 21.7 (Credits and guarantees) in respect
of any such Hedging Agreement,

no Obligor may, and each Obligor shall ensure that no member of the Group shall,
enter into any margin call arrangement, post any collateral or credit support,
grant any Security or otherwise give any guarantee or other financial
accommodation in respect of any Hedging Agreement that such Obligor or, as the
case may be, such member of the Group enters into.

	 	21.20.6	 	The Obligors shall ensure that no member of the Group (other than an Obligor)
enters into any Hedging Agreement.

	 	21.20.7	 	No Obligor shall after the date of this Agreement enter into any Hedging Agreement
under any Master Agreement, Schedule or other agreement in effect prior to the date of
this Agreement, except a Master Agreement in respect of the existing commodity hedges
which the Group has in place with J. Aron and Company (a Goldman Sachs subsidiary).

	21.21	 	Non-Recourse Subsidiaries

Unless the Agent (acting reasonably) shall otherwise agree in writing, the Company:

	 	21.21.1	 	will procure that (i) no investment in any Non-Recourse Subsidiary is made by any
member of the Group (whether represented by amounts subscribed for shares, debentures
or otherwise howsoever) and (ii) no Non-Recourse Subsidiary will incur or permit to
remain outstanding any indebtedness (whether present, future, actual or contingent) or
other liability to any member of the Group, unless (x) (in every such case) at the
time such investment is made or indebtedness or other liability is incurred, the
Conversion Date has not occurred and no Default is continuing and immediately prior to
the making of such investment or such indebtedness or other liability being incurred a
director of the Company has certified on behalf of the Company that no Default is
continuing and (y) the Company would, under the terms of this Agreement, otherwise be
free to pay an amount equal to the amount of such investment, indebtedness or
liability to its shareholders by way of dividend;

	 	21.21.2	 	without prejudice to the generality of the foregoing, it will procure that no
member of the Group gives any guarantee, undertaking or indemnity or undertakes to
permit to subsist any other liability whatsoever contingent or otherwise in favour of
or in respect of an obligation of any Non-Recourse Subsidiary (whether in respect of
indebtedness or the performance of any obligation or otherwise howsoever);

	 	21.21.3	 	without prejudice to the foregoing, it will ensure that all transactions entered
into between any member of the Group and any Non-Recourse Subsidiary (other than the
declaration or payment of any dividend or other distribution by a Non-Recourse
Subsidiary to a member of the Group) shall be on an arms length basis and on normal
commercial terms;

	 	21.21.4	 	will ensure that no Non-Recourse Subsidiary acquires any interest in or entitlement
to (or to the revenues from) any asset the revenues from which were included in a
Projection;

	 	21.21.5	 	will ensure that no Non-Recourse Subsidiary itself has any subsidiary other than a
subsidiary which is also a Non-Recourse Subsidiary;

	 	21.21.6	 	will procure that, insofar as there is a significant risk that it might materially
affect the ability of any Obligor to perform any of their obligations under the
Transaction Documents or might otherwise result in a liability being imposed on any
Finance Party, each Non-Recourse Subsidiary:

	 	(A)	 	exercises all its powers to obtain and maintain in full
force and effect all material Authorisations applicable to it and will comply
in all material respects with all conditions and obligations to which such
material Authorisations may be subject;

	 	(B)	 	carries on its business as a whole in a prudent manner and
uses all reasonable endeavours to procure that each Petroleum interest of it
is operated in accordance with good oilfield practice;

	 	(C)	 	promptly pays as and when due, unless and to the extent
only that such royalties, Taxes and duties are being contested by it in good
faith, all royalties, Taxes and duties of whatsoever kind and whether payable
in the United Kingdom or elsewhere; and

	 	(D)	 	complies with all laws and regulations, applicable to it
(including all Environmental Laws and Licences) in all material respects;

	 	21.21.7	 	will procure that each Non-Recourse Subsidiary, (i) promptly upon becoming aware of
the same, gives written notice to the Agent of every notice of default or adverse
claim or demand made by any person against such Non-Recourse Subsidiary affecting any
of its assets of whatsoever nature (disregarding for this purpose any of the aforesaid
of a spurious nature) if such default (if proved) or claim or demand (if successful)
is reasonably likely to result in a liability being imposed on any member of the Group
and (ii) diligently takes all reasonable steps open to such Non-Recourse Subsidiary to
remedy any such default and protect and defend its interest in the relevant asset
against any such adverse claim or demand; and

	 	21.21.8	 	will procure that each Non-Recourse Subsidiary, as soon as reasonably practicable
following request by the Agent, provides to the Agent such information as the Agent
may reasonably request for the purpose of monitoring compliance with the
representations, covenants and other obligations hereunder which have application to
Non-Recourse Subsidiaries.

	21.22	 	Conditions subsequent – Security

Unless all the Lenders otherwise consent, each Obligor shall procure, and shall procure
that each member of the Group shall as soon as possible after the date of this Agreement
and, in any event, no later than the date falling 45 days after the date of this Agreement:

	 	21.22.1	 	enter into such document(s) as may be required by the Security Trustee (in each
case, in form and substance satisfactory to the Security Trustee) for the purposes of
ensuring that the Finance Parties will, for the purposes of securing the obligations
and liabilities of the Obligors hereunder, have the benefit of Security over the same
assets which are the subject of the Security constituted pursuant to the First Lien
Credit Agreement;

	 	21.22.2	 	deliver to the Security Trustee or procure the delivery to the Security Trustee of,
any documents (including director’s or officer’s certificates and copies of the board
minutes) that may be required for the purposes of any legal opinion that the Security
Trustee may reasonably require in connection with such document(s) and/or such
Security Documents; and

	 	21.22.3	 	without prejudice to Clause 21.16 (Security Documents), take all such steps as may
reasonably be required by the Security Trustee for the perfection or protection of
such Security.

	21.23	 	Condition subsequent – Endeavour North Sea

Unless all the Lenders otherwise consent, each Obligor shall procure that Endeavour North
Sea becomes an Additional Guarantor on or before the date falling 90 days after the date of
this Agreement (the “Accession Date”) and shall ensure that on or before the Accession
Date:

	 	21.23.1	 	Endeavour North Sea (a) delivers to the Agent a duly completed and executed
Accession Letter and (b) executes and enters into all other documents and takes all
such other steps as the Agent may reasonably require in connection with its accession
to, or entry into, all relevant Finance Documents as an Additional Guarantor; and

	 	21.23.2	 	the Agent receives all of the documents and other evidence listed in Part II
(Conditions precedent required to be delivered by an Additional Obligor) of Schedule 3
(Conditions precedent) in relation to Endeavour North Sea, each in form and substance
satisfactory to the Agent.

	21.24	 	No detrimental amendments

Subject always to the Intercreditor Agreement, no Obligor may, and each Obligor shall
ensure that no member of the Group will, to the extent that this Agreement incorporates the
terms (including definitions) of the First Lien Credit Agreement (including for the
purposes of Clause 18 (Cash sweep and expenditure controls)), agree to modify any such
incorporated or related term without the consent of the Majority Lenders if as a result of
such modification, the rights or interests of the Finance Parties hereunder would be
prejudiced in any material way.

	22.	 	FINANCIAL COVENANTS

	 	 	 	 	 	 	 
	22.1	 	Definitions	 	 
	 	 	In this Clause 22 (Financial covenants):
	
 
	 	 	22.1.1	 	 	“Consolidated Cash and Cash Equivalents” means, at any time:

	 	(A)	 	cash in hand or on deposit with any acceptable bank
(including cash collateral balances for decommissioning costs and debt
service cash balances);

	 	(B)	 	certificates of deposit, maturing within one year after the
relevant date of calculation, issued by an acceptable bank;

	 	(C)	 	any investment in marketable obligations issued or
guaranteed by the government of the United States of America or the U.K. or
by an instrumentality or agency of the government of the United States of
America or the U.K. having an equivalent credit rating;

	 	(D)	 	open market commercial paper:

	 	(1)	 	for which a recognised trading market
exists;

	 	(2)	 	issued in the United States of America or
the U.K.;

	 	(3)	 	which matures within one year after the
relevant date of calculation; and

	 	(4)	 	which has a credit rating of either A 1 by
Standard & Poor’s or Fitch or P 1 by Moody’s, or, if no rating is
available in respect of the commercial paper, the issuer of which
has, in respect of its long term debt obligations, an equivalent
rating;

	 	(E)	 	Sterling bills of exchange eligible for rediscount at the
Bank of England and accepted by an acceptable bank; or

	 	(F)	 	any other instrument, security or investment approved by
the Majority Lenders,

in each case, to which any member of the Group is beneficially entitled at that
time and which is capable of being applied against Consolidated Total Borrowings.
An “acceptable bank” for this purpose is a commercial bank or trust company which
has a rating of A- or higher by Standard & Poor’s Rating Group or Fitch or A3 or
higher by Moody’s Investors Service Inc. or a comparable rating from an
internationally recognised credit rating agency for its long term debt obligations
or has been approved by the Majority Lenders.

	 	22.1.2	 	“Consolidated EBITDA” means the consolidated gross pre taxation profits of the Group
for a Measurement Period:

	 	(A)	 	excluding the gross pre taxation profits of a member of the
Group for that part of that Measurement Period when it was not a member of
the Group and the gross pre taxation profits relating to business or assets
acquired by a member of the Group during that Measurement Period for that
part of that Measurement Period when the business or assets were not owned by
a member of the Group; and

	 	(B)	 	excluding the gross pre taxation profits attributable to
any member of the Group or to any business or assets sold during that
Measurement Period,

and all as adjusted by:

	 	(1)	 	adding back Consolidated Net Interest
Payable;

	 	(2)	 	taking no account of any exceptional or
extraordinary item;

	 	(3)	 	excluding any amount attributable to
minority interests;

	 	(4)	 	adding back depreciation, depletion,
amortisation and all exploration and appraisal write-offs;

	 	(5)	 	taking no account of any revaluation of an
asset or any loss or gain over book value arising on the disposal of
an asset (otherwise than in the ordinary course of trading) by a
member of the Group during that Measurement Period;

	 	(6)	 	adding back any non-cash decommissioning
charges;

	 	(7)	 	adding back any non-cash impairment
charges; and

	 	(8)	 	taking no account of any other non-cash
charges or credits (including any non-cash charges or credits arising
by reason of the operation of IAS 17 or IAS 39).

	 	22.1.3	 	“Consolidated Interest Payable” means all interest and other financing charges
(whether, in each case, paid, payable or capitalised) incurred by the Group during a
Measurement Period (excluding any amortisation of any financing fees which have been
paid and any amortisation of any interest related to decommissioning liabilities).

	 	22.1.4	 	“Consolidated Interest Receivable” means all interest and other financing charges
received or receivable by the Group during a Measurement Period.

	 	22.1.5	 	“Consolidated Net Interest Payable” means Consolidated Interest Payable less
Consolidated Interest Receivable during the relevant Measurement Period.

	 	22.1.6	 	“Consolidated Total Borrowings” means, in respect of the Group, at any time the
aggregate of the following:

	 	(A)	 	the outstanding principal amount of any moneys borrowed;

	 	(B)	 	the outstanding principal amount of any acceptance under
any acceptance credit;

	 	(C)	 	the outstanding principal amount of any bond, note,
debenture, loan stock or other similar instrument;

	 	(D)	 	the capital element of indebtedness under a finance or
capital lease;

	 	(E)	 	the outstanding principal amount of all moneys owing in
connection with the sale or discounting of receivables (otherwise than on a
non recourse basis);

	 	(F)	 	the outstanding principal amount of any indebtedness
arising from any deferred payment agreements arranged primarily as a method
of raising finance or financing the acquisition of an asset;

	 	(G)	 	any fixed or minimum premium payable on the repayment or
redemption of any instrument referred to in paragraph (C) above;

	 	(H)	 	the outstanding principal amount of any indebtedness
arising in connection with any other transaction (including any forward sale
or purchase agreement) which has the commercial effect of a borrowing;

	 	(I)	 	the outstanding amount of any guarantee, indemnity, bond,
letter of credit or any other instrument issued by a bank or financial
institution in respect of which any member of the Group has provided a
counter-indemnity; and

	 	(J)	 	the outstanding principal amount of any indebtedness of any
person of a type referred to in paragraphs (A) – (I) above which is the
subject of a guarantee, indemnity or similar assurance against financial loss
given by a member of the Group.

	 	22.1.7	 	“Consolidated Total Net Borrowings” means at any time Consolidated Total Borrowings
less Consolidated Cash and Cash Equivalents.

	 	22.1.8	 	“Current Assets” means, in relation to the Group, the aggregate value of the current
assets which are reasonably expected to be realised, consumed or sold in the ordinary
course of the trading activities of the Group within one year of the date from which
any calculation falls to be made together with cash at bank.

	 	22.1.9	 	“Current Liabilities” means, in relation to the Group, the aggregate value of the
current liabilities which are reasonably expected to be repayable or payable within
one year from the date on which any calculation falls to be made but disregarding any
amounts repayable under the First Lien Credit Agreement which it is anticipated are to
be funded by way of a rollover loan thereunder.

	 	 	 
	22.1.10

22.1.11

22.1.12

	 	“Current Ratio” means the ratio of Current Assets to Current Liabilities.

“IAS 17” means standard 17 (relating to leases) under IFRS.

“IAS 39” means standard 39 (relating to financial instruments) under IFRS.

	 	22.1.13	 	“Measurement Period” means each of the two consecutive six month periods in a
financial year of the Company.

	22.2	 	Interpretation

	 	22.2.1	 	Except as provided to the contrary in this Agreement, an accounting term used in
this Clause is to be construed in accordance with the principles applied in the
preparation of the financial statements delivered in accordance with Clause 20.1
(Financial statements).

	 	22.2.2	 	Any amount in a currency other than dollars is to be taken into account at its
dollar equivalent calculated on the basis of:

	 	(A)	 	the Agent’s spot rate of exchange for the purchase of the
relevant currency in the London foreign exchange market for dollars at or
about 11.00 a.m. on the day the relevant amount falls to be calculated; or

	 	(B)	 	if the amount is to be calculated on the last day of a
financial period of the Company, the relevant rates of exchange used by the
Company in, or in connection with, its financial statements for that period.

	 	22.2.3	 	No item must be credited or deducted more than once in any calculation under this
Clause 22 (Financial Covenant).

	22.3	 	Current Ratio

The Company must ensure that the Current Ratio on the last day of each Measurement Period
is greater than 1.1:1

	22.4	 	Gearing

The Company must ensure that the ratio of (1) Consolidated Total Net Borrowings to (2)
Consolidated EBITDA on the last day of each Measurement Period is less than or equal to
3.0:1.

	22.5	 	Compliance

The financial covenant set out in this Clause 22 (Financial Covenant) shall be tested by
reference to each of the financial statements most recently delivered pursuant to Clause
20.1 (Financial statements).

22.6 Verification

The Agent may, at any time, at the Company’s expense, require the auditors of the Company
to verify any figure or calculation made in any certificate delivered pursuant to Clause
20.1.4 (Financial Statements) if it reasonably believes that any such figure or calculation
is incorrect. If the Agent is not satisfied (acting reasonably) with the verification
provided by the auditors, it may, at the Company’s expense, appoint an independent firm of
accountants to investigate and verify the relevant figures. Such verification shall be
conclusive evidence of whether the Company is in compliance with Clause 22 (Financial
Covenant).

	23.	 	EVENTS OF DEFAULT

	23.1	 	General

Each of the events or circumstances set out in Clause 23.2 (Non-payment and failure to
reduce) to Clause 23.22 (Senior defaults) (inclusive) is an Event of Default.

	23.2	 	Non-payment and failure to reduce

An Obligor or any Transaction Party does not pay on the due date any amount payable by it
under the Finance Documents in the manner required under the Finance Documents, unless the
non-payment:

	 	 	 
	23.3

	 	23.2.1is caused by technical or administrative error or a Disruption Event; and

23.2.2is remedied within two Business Days of the due date.

Breach of other obligations

	 	23.3.1	 	The Company does not comply with any term of Clause 22 (Financial Covenants).

	 	23.3.2	 	An Obligor or any Transaction Party does not comply with any other term of the
Finance Documents to which it is a party not already referred to in Clause 23.3.1,
unless the non-compliance:

	 	(A)	 	in the reasonable opinion of the Majority Lenders, is
capable of remedy; and

	 	(B)	 	is remedied within 10 Business Days of the earlier of the
Agent giving notice and the relevant Obligor or Transaction Party (as the
case may be) becoming aware of the non-compliance.

	23.4	 	Misrepresentation

A representation made or repeated by any Obligor or Transaction Party in any Finance
Document to which it is a party or in any document delivered by or on behalf of any Obligor
or Transaction Party under any Finance Document to which it is a party is incorrect in any
material respect when made or deemed to be repeated, unless the circumstances giving rise
to the misrepresentation:

	 	23.4.1	 	are capable of remedy; and

	 	23.4.2	 	are remedied within 10 Business Days of the earlier of the Agent giving notice and
the relevant Obligor or Transaction Party (as the case may be) becoming aware of the
misrepresentation.

	23.5	 	Cross-default

Any of the following occurs in respect of an Obligor or any other member of the Group:

	 	23.5.1	 	any of its Financial Indebtedness is not paid when due and payable (after the expiry
of any originally applicable grace period);

	 	23.5.2	 	any of its Financial Indebtedness:

	 	(A)	 	becomes prematurely due and payable;

	 	(B)	 	is placed on demand; or

	 	(C)	 	is capable of being declared by a creditor to be
prematurely due and payable or being placed on demand,

in each case, as a result of an event of default (howsoever described); or

	 	23.5.3	 	any commitment for its Financial Indebtedness is cancelled or suspended as a result
of an event of default (howsoever described),

unless the aggregate amount of Financial Indebtedness falling within Clause
23.5.1, Clause 23.5.2 or Clause 23.5.2(C) (as the case may be) is less than
$10,000,000 (or its equivalent in one or more other currencies).

	23.6	 	Insolvency

Any of the following occurs in respect of an Obligor or any other member of the Group:

	 	23.6.1	 	it is, or is deemed for the purposes of any law to be, unable to pay its debts as
they fall due or insolvent;

	 	23.6.2	 	it admits its inability to pay its debts as they fall due;

	 	23.6.3	 	it suspends making payments on any of its debts or announces an intention to do so;

	 	23.6.4	 	by reason of actual or anticipated financial difficulties, it begins negotiations
with any creditor for the rescheduling of any of its indebtedness; or

	 	23.6.5	 	a moratorium is declared in respect of any of its indebtedness.

	23.7	 	Insolvency proceedings

	 	23.7.1	 	Except as provided in Clause 23.7.2, any of the following occurs in respect of an
Obligor or any other member of the Group:

	 	(A)	 	any step is taken with a view to a faillissement, surséance
van betaling, composition, assignment or similar arrangement with any of its
creditors;

	 	(B)	 	a meeting of it is convened for the purpose of considering
any resolution for (or to petition for) its winding-up, administration, or
dissolution or any such resolution is passed;

	 	(C)	 	any person presents a petition, files an application or
takes any other analogous steps for its winding-up, administration, or
dissolution;

	 	(D)	 	an order for its winding-up, administration, or dissolution
is made;

	 	(E)	 	any Insolvency Officer is appointed in respect of it or any
of its assets;

	 	(F)	 	its directors or other officers request the appointment of
an Insolvency Officer;

	 	(G)	 	a notice under section 36 of the Tax Collection Act of The
Netherlands (Invorderingswet 1990) or section 16(d) of the Social Insurance
Co-ordination Act of The Netherlands (Coördinatiewet Sociale Verzekeringen)
is filed upon a member of the Group that is incorporated or established in
The Netherlands; or

	 	(H)	 	any other analogous step or procedure is taken in any
jurisdiction.

	 	23.7.2	 	Clause 23.7.1 does not apply to:

	 	(A)	 	any step or procedure which is part of a Permitted
Transaction; or

	 	(B)	 	a petition for winding-up presented by a creditor which is
being contested in good faith and with due diligence and is discharged or
struck out within 14 days; or

	 	(C)	 	any petition, action, proceeding or step which is
demonstrated by the Company to the reasonable satisfaction of the Agent to be
frivolous, vexatious or otherwise an abuse of process of court.

	23.8	 	Enforcement of security

Any steps are taken to enforce any Security securing Financial Indebtedness in excess of
$5,000,000 (or its equivalent in one or more other currencies), in aggregate, over any part
of the assets of an Obligor or any other member of the Group.

	23.9	 	Creditors’ process

Any prejudgment attachment (conservatoir Beslag), expropriation attachment, sequestration,
distress, execution, diligence or analogous event affects any asset(s) of any Obligor or
any other member of the Group having an aggregate value in excess of $5,000,000 (or its
equivalent in one or more other currencies) and is not discharged within 14 days unless it
is any petition, action, proceeding or step which is demonstrated by the Company to the
reasonable satisfaction of the Agent to be frivolous, vexatious or otherwise an abuse of
process of court.

	23.10	 	Analogous proceedings

There occurs, in relation to any Obligor or any other member of the Group, any event
anywhere which, in the reasonable opinion of the Majority Lenders, corresponds with any of
those mentioned in Clauses 23.6 (Insolvency) to 23.9 (Creditors’ process) (inclusive).

	23.11	 	Cessation of business

Any Obligor threatens to cease to carry on business except as part of a Permitted
Transaction.

	23.12	 	Unlawfulness

It is or becomes unlawful for any Obligor to perform any of its material obligations under
any Project Document.

	23.13	 	Effectiveness of Finance Documents

	 	23.13.1	 	It is or becomes unlawful for any Obligor or Transaction Party to perform any of
its payment obligations or other material obligations under the Finance Documents.

	 	23.13.2	 	Any Finance Document, the guarantee of any Guarantor or any Security purported to
be created or evidenced by any Security Document is not effective or is unenforceable
or is alleged by any Obligor or any Transaction Party to be ineffective or
unenforceable for any reason.

	 	23.13.3	 	An Obligor or Transaction Party repudiates a Finance Document or evidences an
intention to repudiate a Finance Document.

	23.14	 	Ownership

Any member of the Group that holds any interests in any Borrowing Base Assets or Obligor is
not or ceases to be a wholly-owned (directly or indirectly) by the Company.

	23.15	 	Project Documents

	 	23.15.1	 	All or any part of any Project Document is not, or ceases to be, a legal, valid and
binding obligation of any person expressed to be party to it in circumstances which
are reasonably likely to result in a Material Adverse Change.

	 	23.15.2	 	Any party to any Project Document defaults under that Project Document in
circumstances which are reasonably likely to result in a Material Adverse Change.

	 	23.15.3	 	All or any part of any Project Document is suspended, terminated or revoked in
circumstances which are reasonably likely to result in a Material Adverse Change.

	23.16	 	Borrowing Base Assets

	 	23.16.1	 	A decision is taken to abandon a Borrowing Base Asset unless such a decision was
taken in compliance with Clause 21.13.2 (Borrowing Base Assets).

	 	23.16.2	 	All or any part of the interest of any member of the Group in any Borrowing Base
Asset (or any Petroleum or revenues or other moneys arising in respect of it) is
nationalised, expropriated, compulsorily acquired or seized by any government or any
governmental or public sector agency, or any such government or agency takes, or
officially announces that it will take, any step with a view to any of the foregoing
and the same is reasonably likely to result in a Material Adverse Change.

	23.17	 	Litigation

Any judgment is made or award is issued against any Obligor in relation to any litigation,
arbitration or administrative proceedings in an amount equal to or exceeding $10,000,000
(or its equivalent in one or more other currencies) or any litigation, arbitration or
administrative proceeding is instituted or current in respect of any Obligor or any member
of the Group which would be reasonably likely, if adversely determined, to result in a
Material Adverse Change.

	23.18	 	Authorisations

Any Authorisation necessary for the ownership of any interest in, the development or the
operation of, any Borrowing Base Asset is revoked, cancelled, surrendered, terminated or
varied and the same would be reasonably likely to result in a Material Adverse Change.

	23.19	 	Material Adverse Change

An event occurs which is reasonably likely to result in a Material Adverse Change as
compared to the position as at the date of this Agreement.

	23.20	 	Qualification of accounts

Any audited financial statements delivered to the Agent under this Agreement is qualified
in any material way.

	23.21	 	Evidential inadmissibility

At any time any act, condition or thing required to be done, fulfilled or performed (other
than by the Finance Parties) in order to make each Finance Document to which any Obligor or
Transaction Party is a party admissible in evidence in the country in which such party is
incorporated is not done, fulfilled or performed to the extent or in a respect such that
the effect thereof is materially to impair the legality, validity or enforceability of the
obligations of any Obligor or any Transaction Party under the Finance Documents.

	23.22	 	Senior defaults

An Event of Default (as defined in the First Lien Credit Agreement) has occurred and is
continuing.

	23.23	 	Acceleration

On and at any time after the occurrence of an Event of Default which is continuing the
Agent may, and shall if so directed by the Majority Lenders, by notice to the Company:

	 	23.23.1	 	cancel the Aggregate Commitments whereupon they shall immediately be cancelled;
and/or

	 	23.23.2	 	declare that all or part of the Loans, together with accrued interest, and all
other amounts accrued or outstanding under the Finance Documents be immediately due
and payable, whereupon they shall become immediately due and payable; and/or

	 	23.23.3	 	declare that all or part of the Loans payable on demand, whereupon they shall
immediately become payable on demand by the Agent on the instructions of the Majority
Lenders.

4

CHANGES TO PARTIES

	24.	 	CHANGES TO THE LENDERS

	 	 	 	 	 
	24.1	 	Assignments and transfers by the Lenders	 	 
	 	 	Subject to this Clause 24 (Changes to the Lenders), a Lender (the “Existing Lender") may:
	
 
	 	24.1.1

24.1.2
	 	assign any of its rights; or

transfer by novation any of its rights and obligations,

to another bank or financial institution or to a trust, fund or other entity which is
regularly engaged in or established for the purpose of making, purchasing or investing in
loans, securities or other financial assets (the “New Lender").

	24.2	 	Conditions of assignment or transfer

	 	24.2.1	 	Any Lender wishing to assign or transfer all or any of its rights and obligations
under the Finance Documents shall give the Company not less than 5 Business Days prior
written notice to that effect.

	 	24.2.2	 	The consent of the Company is required for an assignment or transfer by an Existing
Lender, unless subject to Clause 24.2.5(B) (a) the assignment or transfer is to another
Lender or an Affiliate of a Lender, (b) an Event of Default has occurred and is
continuing, or (c) the assignment or transfer is made in connection with the primary
syndication of the Facility.

	 	24.2.3	 	The consent of the Company to an assignment or transfer must not be unreasonably
withheld or delayed. The Company will be deemed to have given its consent five
Business Days after the Existing Lender has requested it unless consent is expressly
refused by the Company within that time.

	 	24.2.4	 	The consent of the Company to an assignment or transfer must not be withheld solely
because the assignment or transfer may result in an increase to the Mandatory Cost.

	 	24.2.5	 	An assignment will only be effective on:

	 	(A)	 	receipt by the Agent of written confirmation from the New
Lender (in form and substance satisfactory to the Agent) that the New Lender
will assume the same obligations to the other Finance Parties as it would have
been under if it was an Original Lender; and

	 	(B)	 	performance by the Agent of all necessary “know your customer”
or other similar checks under all applicable laws and regulations in relation
to such assignment to a New Lender, the completion of which the Agent shall
promptly notify to the Existing Lender and the New Lender.

	 	24.2.6	 	In order to comply with the Dutch Financial Supervision Act (Wet op het financieel
toezicht), any assignment or transfer by an Existing Lender pursuant to this Clause 24
shall in any event be in an amount of at least €50,000 (or its equivalent in any other
currency) or such other amount as may be required form time to time by the Dutch
Financial Supervision Act or, if less, the New Lender shall confirm in writing to the
Company that it is a professional market party (professionele marktpartij) within the
meaning of the Dutch Financial supervision Act (Wet op het financieel toezicht).

	 	24.2.7	 	A transfer will only be effective if the procedure set out in Clause 24.5 (Procedure
for transfer) is complied with.

	 	24.2.8	 	If:

	 	(A)	 	a Lender assigns or transfers any of its rights or obligations
under the Finance Documents or changes its Facility Office; and

	 	(B)	 	as a result of circumstances existing at the date the
assignment, transfer or change occurs, an Obligor would be obliged to make a
payment to the New Lender or Lender acting through its new Facility Office
under Clause 12 (Tax gross-up and indemnities) or Clause 13 (Increased Costs),

then the New Lender or Lender acting through its new Facility Office is only
entitled to receive payment under those Clauses to the same extent as the Existing
Lender or Lender acting through its previous Facility Office would have been if the
assignment, transfer or change had not occurred.

	 	24.2.9	 	Where the consent of the Company is required under Clause 24.2.2 above, the assigning
or transferring Lender shall provide a copy of the Company’s response to the Agent. If
the Company does not provide a response, the assigning Lender shall inform the Agent of
this fact.

	24.3	 	Assignment or transfer fee

The New Lender shall, on the date upon which an assignment or transfer takes effect (other
than pursuant to the primary syndication of the Facility), pay to the Agent (for its own
account) a fee of $2,000.

	24.4	 	Limitation of responsibility of Existing Lenders

	 	24.4.1	 	Unless expressly agreed to the contrary, an Existing Lender and each existing Finance
Party makes no representation or warranty and assumes no responsibility to a New Lender
for:

	 	(A)	 	the legality, validity, effectiveness, adequacy or
enforceability of the Finance Documents or any other documents;

	 	(B)	 	the financial condition of any Obligor or any other member of
the Group;

	 	(C)	 	the performance and observance by any Obligor or any other
member of the Group of its obligations under the Finance Documents or any other
documents; or

	 	(D)	 	the accuracy of any statements (whether written or oral) made
in or in connection with any Finance Document or any other document,

	 	 	 
	24.4.2

	 	and any representations or warranties implied by law are excluded.

Each New Lender confirms to the Existing Lender and the other Finance Parties that it:

	 	(A)	 	has made (and shall continue to make) its own independent
investigation and assessment of the financial condition and affairs of each
Obligor and its related entities in connection with its participation in this
Agreement and has not relied exclusively on any information provided to it by
the Existing Lender or any existing Finance Party in connection with any
Finance Document; and

	 	(B)	 	will continue to make its own independent appraisal of the
creditworthiness of each Obligor and its related entities whilst any amount is
or may be outstanding under the Finance Documents or any Commitment is in
force.

	 	24.4.3	 	Nothing in any Finance Document obliges an Existing Lender or any existing Finance
Party to:

	 	(A)	 	accept a re-transfer from a New Lender of any of the rights and
obligations assigned or transferred under this Clause 24 (Changes to the
Lenders); or

	 	(B)	 	support any losses directly or indirectly incurred by the New
Lender by reason of the non-performance by any Obligor or Transaction Party of
its obligations under the Finance Documents or otherwise.

	24.5	 	Procedure for transfer

	 	24.5.1	 	Subject to the conditions set out in Clause 24.2 (Conditions of assignment or
transfer) a transfer is effected in accordance with Clause 24.5.3 when the Agent
executes an otherwise duly completed Transfer Certificate delivered to it by the
Existing Lender and the New Lender. The Agent shall as soon as reasonably practicable
after receipt by it of a duly completed Transfer Certificate appearing on its face to
comply with the terms of this Agreement and delivered in accordance with the terms of
this Agreement, execute that Transfer Certificate.

	 	24.5.2	 	The Agent shall only be obliged to execute a Transfer Certificate delivered to it by
the Existing Lender and the New Lender once it is satisfied it has complied with all
necessary “know your customer” or other similar checks under all applicable laws and
regulations in relation to the transfer to such New Lender.

	 	24.5.3	 	On the Transfer Date:

	 	(A)	 	to the extent that in the Transfer Certificate the Existing
Lender seeks to transfer by novation its rights and obligations under the
Finance Documents each of the Obligors and the Existing Lender shall be
released from further obligations towards one another under the Finance
Documents and their respective rights against one another under the Finance
Documents shall be cancelled (being the “Discharged Rights and Obligations");

	 	(B)	 	each of the Obligors and the New Lender shall assume
obligations towards one another and/or acquire rights against one another which
differ from the Discharged Rights and Obligations only insofar as that Obligor
and the New Lender have assumed and/or acquired the same in place of that
Obligor and the Existing Lender;

	 	(C)	 	the existing Finance Parties and the New Lender shall acquire
the same rights and assume the same obligations between themselves as they
would have acquired and assumed had the New Lender been an Original Lender with
the rights and/or obligations acquired or assumed by it as a result of the
transfer and to that extent the existing Finance Parties and the Existing
Lender shall each be released from further obligations to each other under the
Finance Documents; and

	 	(D)	 	the New Lender shall become a Party as a “Lender".

	24.6	 	Copy of Transfer Certificates

The Agent shall, as soon as reasonably practicable after it has executed a Transfer
Certificate, send to the Company a copy of that Transfer Certificate.

	 	 	 	 	 	 	 
	24.7	 	Disclosure of information
	
 
	 	 	24.7.1	 	 	Any Finance Party may disclose to any of its Affiliates and any other person:

	 	(A)	 	to (or through) whom that Finance Party assigns or transfers
(or may potentially assign or transfer) all or any of its rights and
obligations under this Agreement and/or the other Finance Documents;

	 	(B)	 	with (or through) whom that Finance Party enters into (or may
potentially enter into) any sub-participation in relation to, or any other
transaction under which payments are to be made by reference to, this Agreement
(or any other Finance Documents) or any Obligor;

	 	(C)	 	to whom, and to the extent that, information is required to be
disclosed by any applicable law or regulation;

	 	(D)	 	which is an investor or potential investor (including an
investor, sub-participant, lender or other party in relation to a
securitisation) in any of its rights and obligations under the Finance
Documents;

	 	(E)	 	which is a rating agency;

	 	(F)	 	in connection with any securitisation (or similar or analogous
transaction);

	 	(G)	 	which is one of its professional advisers;

	 	(H)	 	which is a person in whose favour that Finance Party creates
Security over its rights under or in connection with the Transaction Documents,
or

	 	(I)	 	that is a receiver, administrator or other Insolvency Officer
or a prospective receiver, administrator or other Insolvency Officer, in each
case, with respect to any Obligor or its assets,

any information about any Obligor, any other member of the Group, the Borrowing Base
Assets, and the Transaction Documents as that Finance Party shall consider
appropriate if, in relation to Clauses 24.7.1(A), 24.7.1(B), 24.7.1(F) and
24.7.1(H), the person to whom the information is to be given has entered into a
Confidentiality Undertaking.

	 	24.7.2	 	In addition, any Finance Party may disclose any such information to any person if
such disclosure is required to be made (a) in connection with any litigation,
arbitration or administrative proceedings or (b) to any governmental, banking, taxation
or other regulatory authority.

	25.	 	CHANGES TO THE OBLIGORS

	25.1	 	Assignments and transfer by Obligors

No Obligor may assign any of its rights or transfer any of its rights or obligations under
the Finance Documents.

	25.2	 	Additional Borrowers

	 	25.2.1	 	The Company may request that any Relevant Affiliate becomes an Additional Borrower.
That Relevant Affiliate shall become an Additional Borrower if:

	 	(A)	 	all Lenders approve the addition of that Relevant Affiliate,

	 	(B)	 	that Relevant Affiliate (a) delivers to the Agent a duly
completed and executed Accession Letter and (b) executes and enters into all
other documents and takes all such other steps as the Agent may reasonably
require for the purposes of ensuring that it accedes and becomes a party to,
all relevant Finance Documents as an Additional Borrower;

	 	(C)	 	the Company confirms that no Default is continuing or would
occur as a result of that Relevant Affiliate becoming an Additional Borrower;
and

	 	(D)	 	the Agent has received all of the documents and other evidence
listed in Part II (Conditions precedent required to be delivered by an
Additional Obligor) of Schedule 3 (Conditions precedent) in relation to that
Additional Borrower, each in form and substance satisfactory to the Agent.

	 	25.2.2	 	The Agent shall, in relation to each proposed Additional Borrower, notify the Company
and the Lenders promptly upon being satisfied that it has received (in form and
substance satisfactory to it) all the documents and other evidence listed in Part II
(Conditions precedent required to be delivered by an Additional Obligor) of Schedule 3
(Conditions precedent).

	25.3	 	Additional Guarantors

	 	25.3.1	 	The Company may request that any Relevant Affiliate becomes an Additional Guarantor.
That Relevant Affiliate shall become an Additional Guarantor if:

	 	(A)	 	that Relevant Affiliate (a) delivers to the Agent a duly
completed and executed Accession Letter and (b) executes and enters into all
other documents and takes all such other steps as the Agent may reasonably
require for the purposes of ensuring that it accedes and becomes a party to,
all relevant Finance Documents as an Additional Guarantor; and

	 	(B)	 	the Agent has received all of the documents and other evidence
listed in Part II (Conditions precedent required to be delivered by an
Additional Obligor) of Schedule 3 (Conditions precedent) in relation to that
Additional Guarantor, each in form and substance satisfactory to the Agent.

	 	25.3.2	 	The Company shall procure that (i) promptly upon any member of the Group becoming a
Material Subsidiary and (ii) prior to any member of the Borrower Group acquiring a
Borrowing Base Asset (if it is not already an Obligor) it shall become an Additional
Guarantor (unless prohibited under the laws of their jurisdiction of incorporation,
despite the Company and such member of the Group or Borrower Group having used all
reasonable endeavours to overcome such prohibition) and shall ensure that:

	 	(A)	 	such member of the group (a) delivers to the Agent a duly
completed and executed Accession Letter and (b) executes and enters into all
other documents and takes all such other steps as the Agent may reasonably
require for the purposes of ensuring that it accedes and becomes a party to,
all relevant Finance Documents as an Additional Guarantor; and

	 	(B)	 	the Agent receives all of the documents and other evidence
listed in Part II (Conditions precedent required to be delivered by an
Additional Obligor) of Schedule 3 (Conditions precedent) in relation to that
Additional Guarantor, each in form and substance satisfactory to the Agent.

	 	25.3.3	 	The Agent shall, in relation to each proposed Additional Guarantor, notify the
Company and the Lenders promptly upon being satisfied that it has received (in form and
substance satisfactory to it) all the documents and other evidence listed in Part II
(Conditions precedent required to be delivered by an Additional Obligor) of Schedule 3
(Conditions precedent).

	25.4	 	Repetition of Representations

Delivery of an Accession Letter constitutes confirmation by the relevant intended Obligor
that the Repeating Representations are true and correct in relation to it as at the date of
delivery as if made by reference to the facts and circumstances then existing.

	25.5	 	Release of non-asset holding Obligors

	 	25.5.1	 	For the purposes of this Clause 25.5 (Release of non-asset holding Obligors), a
“Relevant Obligor” means any Obligor (other than the Company) that (a) does not have an
interest in any Borrowing Base Asset or any shares or other interest in any person
holding an interest in any Borrowing Base Asset (whether by reason of any Borrowing
Base Asset ceasing to be so designated in accordance with this Agreement or otherwise)
and (b) is not a Material Subsidiary.

	 	25.5.2	 	The Company may submit a request to the Agent at any time for any Relevant Obligor to
cease to be an Obligor.

	 	25.5.3	 	Subject to Clause 25.5.4, as soon as reasonably practicable after the submission of
any such request, the Finance Parties shall (at the cost and expense of the Obligors)
take all such steps as the Company may reasonably require for the purposes of ensuring:

	 	(A)	 	that the Relevant Obligor ceases to be an Obligor for the
purposes of the Finance Documents; and

	 	(B)	 	the release of any Security under the Finance Documents granted
to the Finance Parties (a) by the Relevant Obligor over its assets or (b) by
any other person over the shares in the Relevant Obligor.

	 	25.5.4	 	A Relevant Obligor may only cease to be an Obligor pursuant to this Clause 25.5
(Release of non-asset holding Obligors) if:

	 	(A)	 	no Default is continuing or would result from it ceasing to be
an Obligor (and the Company confirms that this is the case); and

	 	(B)	 	(other than in the case of Endeavour North Sea) the Majority
Lenders consent to such Relevant Obligor ceasing to be an Obligor; and

	 	(C)	 	in the case only of Endeavour North Sea:

	 	(1)	 	the Permitted Transaction described in paragraph
(B) of the definition of “Permitted Transaction” has been completed upon
the terms described therein;

	 	(2)	 	Endeavour North Sea is under no actual or
contingent obligation as a Borrower; and

	 	(3)	 	Endeavour North Sea has no assets whatsoever,

and, in each case, the Company confirms the same to the Agent.

5

THE FINANCE PARTIES

	26.	 	ROLE OF THE ADMINISTRATIVE FINANCE PARTIES

	26.1	 	General

For the purposes only of this Clause 26 (Role of the Administrative Finance Parties),
references to the Administrative Finance Parties shall be construed as excluding the
Security Trustee.

	26.2	 	Appointment of the Agent

	 	26.2.1	 	Each other Finance Party appoints the Agent to act as its agent under and in
connection with the Finance Documents.

	 	26.2.2	 	Each other Finance Party authorises the Agent to exercise the rights, powers,
authorities and discretions specifically given to the Agent under or in connection with
the Finance Documents together with any other incidental rights, powers, authorities
and discretions.

	26.3	 	Duties of the Agent

	 	26.3.1	 	The Agent shall promptly forward to a Party the original or a copy of any document
which is delivered to the Agent for that Party by any other Party.

	 	26.3.2	 	Except where a Finance Document specifically provides otherwise, the Agent is not
obliged to review or check the adequacy, accuracy or completeness of any document it
forwards to another Party.

	 	26.3.3	 	If the Agent receives notice from a Party referring to this Agreement, describing a
Default and stating that the circumstance described is a Default, it shall promptly
notify the other Finance Parties.

	 	26.3.4	 	If the Agent is aware of the non-payment of any principal, interest, commitment fee
or other fee payable to a Finance Party (other than an Administrative Finance Party or
the Security Trustee) under this Agreement it shall promptly notify the other Finance
Parties.

	 	26.3.5	 	The Agent’s duties under the Finance Documents are solely mechanical and
administrative in nature.

	26.4	 	Role of the Mandated Lead Arrangers

Except as specifically provided in the Finance Documents, the Mandated Lead Arrangers have
no obligations of any kind to any other Party under or in connection with any Finance
Document.

	26.5	 	No fiduciary duties

	 	26.5.1	 	Nothing in this Agreement constitutes any Administrative Finance Party as a trustee
or fiduciary of any other person.

	 	26.5.2	 	No Administrative Finance Party shall be bound to account to any Finance Party for
any sum or the profit element of any sum received by it for its own account.

	26.6	 	Business with the Group

Each Administrative Finance Party may accept deposits from, lend money to and generally
engage in any kind of banking or other business with any Obligor or any other member of the
Group.

	 	 	 	 	 	 	 
	26.7	 	Rights and discretions of the Administrative Finance Parties
	
 
	 	 	26.7.1	 	 	Each Administrative Finance Party may rely on:

	 	(A)	 	any representation, notice or document believed by it to be
genuine, correct and appropriately authorised; and

	 	(B)	 	any statement made by a director, authorised signatory or
employee of any person regarding any matters which may reasonably be assumed to
be within his knowledge or within his power to verify.

	 	26.7.2	 	Each Administrative Finance Party may assume (unless it has received notice to the
contrary in its capacity as an Administrative Finance Party) that:

	 	(A)	 	no Default has occurred (unless it has actual knowledge of a
Default arising under Clause 23.2 (Non-payment and failure to reduce));

	 	(B)	 	any right, power, authority or discretion vested in any Party
or the Majority Lenders has not been exercised; and

	 	(C)	 	any notice or request made by the Company (other than a
Utilisation Request or Selection Notice) is made on behalf of and with the
consent and knowledge of all the Obligors.

	 	26.7.3	 	Each Administrative Finance Party may engage, pay for and rely on the advice or
services of any lawyers, accountants, surveyors or other experts.

	 	26.7.4	 	Each Administrative Finance Party may act in relation to the Finance Documents
through its personnel and agents.

	 	26.7.5	 	Each Administrative Finance Party may disclose to any other Party any information it
reasonably believes it has received in its capacity as such under this Agreement.

	 	26.7.6	 	Notwithstanding any other provision of any Finance Document to the contrary, no
Administrative Finance Party is obliged to do or omit to do anything if it would or
might in its reasonable opinion constitute a breach of any law or regulation or a
breach of a fiduciary duty or duty of confidentiality.

	26.8	 	Majority Lenders’ instructions

	 	26.8.1	 	Unless a contrary indication appears in a Finance Document, the Agent shall (a)
exercise any right, power, authority or discretion vested in it in such capacity in
accordance with any instructions given to it by the Majority Lenders (or, if so
instructed by the Majority Lenders), refrain from exercising any right, power,
authority or discretion vested in it and (b) not be liable for any act (or omission) if
it acts (or refrains from taking any action) in accordance with an instruction of the
Majority Lenders.

	 	26.8.2	 	Unless a contrary indication appears in a Finance Document, any instructions given by
the Majority Lenders will be binding on all the Finance Parties.

	 	26.8.3	 	The Agent may refrain from acting in accordance with the instructions of the Majority
Lenders (or, if appropriate, the Lenders) until it has received such security as it may
require for any cost, loss or liability (together with any associated VAT) which it may
incur in complying with the instructions.

	 	26.8.4	 	In the absence of instructions from the Majority Lenders, (or, if appropriate, the
Lenders) the Agent may act (or refrain from taking action) as it considers to be in the
best interest of the Finance Parties.

	 	26.8.5	 	The Agent is not authorised to act on behalf of a Finance Party (without first
obtaining that Finance Party’s consent) in any legal or arbitration proceedings
relating to any Finance Document.

	26.9	 	Responsibility for documentation

No Administrative Finance Party is liable or responsible for:

	 	26.9.1	 	the adequacy, accuracy and/or completeness of any information (whether oral or
written) supplied by it, an Obligor or any other person given in or in connection with
any Finance Document; or

	 	26.9.2	 	the legality, validity, effectiveness, adequacy or enforceability of any Finance
Document or any other agreement, arrangement or document entered into, made or executed
in anticipation of or in connection with any Finance Document.

	26.10	 	Exclusion of liability

	 	26.10.1	 	Without limiting Clause 26.10.2, and without prejudice to the provisions of
paragraph (e) of Clause 29.10 (Disruption to Payment Systems etc.) no Administrative
Finance Party will be liable (including, for negligence or any other category of
liability whatsoever) for any action taken by it under or in connection with any
Finance Document, unless directly caused by its gross negligence or wilful misconduct.

	 	26.10.2	 	No Party (other than an Administrative Finance Party) may take any proceedings
against any officer, employee or agent of that Administrative Finance Party in respect
of any claim it might have against that Administrative Finance Party or in respect of
any act or omission of any kind by that officer, employee or agent in relation to any
Finance Document and any officer, employee or agent of that Administrative Finance
Party may rely on this Clause 26.10.2 subject to Clause 1.3 (Third party rights) and
the provisions of the Third Parties Act.

	 	26.10.3	 	No Administrative Finance Party will be liable for any delay (or any related
consequences) in crediting an account with an amount required under the Finance
Documents to be paid by that Administrative Finance Party if it has taken all necessary
steps as soon as reasonably practicable to comply with the regulations or operating
procedures of any recognised clearing or settlement system used by it for that purpose.

	 	26.10.4	 	Nothing in this Agreement shall oblige any Administrative Finance Party to carry out
any “know your customer” or other checks in relation to any person on behalf of any
Finance Party and each Finance Party confirms to the Administrative Finance Parties
that it is solely responsible for any such checks it is required to carry out and that
it may not rely on any statement in relation to such checks made by any Administrative
Finance Party.

	26.11	 	Lenders’ indemnity

	 	26.11.1	 	Each Lender shall (in proportion to its share of the Aggregate Commitments or, if
the Aggregate Commitments are then zero, to its share of the Aggregate Commitments
immediately prior to their reduction to zero) within three Business Days of demand,
indemnify:

	 	(A)	 	each Administrative Finance Party, against any cost, loss or
liability (including, for negligence or any other category of liability
whatsoever) incurred by that Administrative Finance Party (otherwise than by
reason of its gross negligence or wilful misconduct) in acting in its capacity
as such an Administrative Finance Party under or in connection with the Finance
Documents; and

	 	(B)	 	the Agent against any cost, loss or liability, in the case of
any cost, loss or liability (notwithstanding the Agent’s negligence, gross
negligence or any other category of liability whatsoever) pursuant to Clause
29.10 (Disruption to Payment Systems etc.) (but excluding any claim based on
the fraud of the Agent in acting in such capacity),

unless, in the case of Clause 26.11.1(A) and 26.11.1(B), that Administrative Finance
Party has been reimbursed for the same by an Obligor pursuant to a Finance Document.

	 	26.11.2	 	The Obligors shall forthwith on demand reimburse each Finance Party for any payments
made by it under this Clause 26.11 (Lenders’ indemnity).

	26.12	 	Resignation

	 	26.12.1	 	The Agent may resign at any time and appoint one of its Affiliates acting through an
office in the United Kingdom or Paris as successor by giving notice to the other
Finance Parties and the Company.

	 	26.12.2	 	Alternatively the Agent may resign by giving notice to the other Finance Parties and
the Company, in which case the Majority Lenders (after consultation with the Company)
may appoint a successor Agent.

	 	26.12.3	 	If the Majority Lenders have not appointed a successor Agent in accordance with
Clause 26.12.2 within 30 days after notice of resignation was given, the incumbent
Agent (after consultation with the Company and the Majority Lenders) may appoint a
successor Agent (acting through an office in the United Kingdom or Paris).

	 	26.12.4	 	The retiring Agent shall, at its own cost, make available to the successor Agent
such documents and records and provide such assistance as the successor Agent may
reasonably request for the purposes of performing its functions as Agent under the
Finance Documents.

	 	26.12.5	 	The Agent’s resignation notice shall only take effect upon the successor Agent (a)
notifying all the Parties that it accepts its appointment and (b) completing all such
steps as may reasonably be required by the Majority Lenders in order to (1) ensure that
it accedes, and becomes a party, to all relevant Finance Documents in its capacity as
Agent and (2) facilitate the change in identity of the Agent.

	 	26.12.6	 	Upon the appointment of a successor, the retiring Agent shall be discharged from any
further obligation in respect of the Finance Documents but shall remain entitled to the
benefit of this Clause 26 (Role of the Administrative Finance Parties). Its successor
and each of the other Parties shall have the same rights and obligations amongst
themselves as they would have had if such successor had been an original Party.

	 	26.12.7	 	After consultation with the Company, the Majority Lenders may, by notice to the
Agent, require it to resign in accordance with Clause 26.12.2. In this event, the
relevant Administrative Finance Party shall resign in accordance with Clause 26.12.2.

	26.13	 	Confidentiality

	 	26.13.1	 	In acting under the Finance Documents, the relevant division through which each
Administrative Finance Party acts shall be treated as a separate entity from any other
of its divisions or departments.

	 	26.13.2	 	If information is received by another division or department of an Administrative
Finance Party, it may be treated as confidential to that relevant division or
department and that Administrative Finance Party shall not be deemed to have notice of
it.

	26.14	 	Relationship with the Lenders

	 	26.14.1	 	Each Administrative Finance Party may treat each Lender as a Lender, entitled to
payments under this Agreement and acting through its Facility Office unless it has
received not less than five Business Days prior notice from that Lender to the contrary
in accordance with the terms of this Agreement.

	 	26.14.2	 	Each Lender shall supply the Agent with any information required by the Agent in
order to calculate the Mandatory Cost in accordance with Schedule 5 (Mandatory Cost
formulae).

	26.15	 	Credit appraisal by the Finance Parties

Without affecting the responsibility of any Obligor for information supplied by it or on its
behalf in connection with any Finance Document, each Finance Party confirms to each
Administrative Finance Party that it has been, and will continue to be, solely responsible
for making its own independent appraisal and investigation of all risks arising under or in
connection with any Finance Document including:

	 	26.15.1	 	the financial condition, status and nature of each Obligor and each other member of
the Group;

	 	26.15.2	 	the legality, validity, effectiveness, adequacy or enforceability of any Finance
Document and any other agreement, arrangement or document entered into, made or
executed in anticipation of, under or in connection with any Finance Document;

	 	26.15.3	 	whether that Finance Party has recourse, and the nature and extent of that recourse,
against any Party or any of its respective assets under or in connection with any
Finance Document, the transactions contemplated by the Finance Documents or any other
agreement, arrangement or document entered into, made or executed in anticipation of,
under or in connection with any Finance Document; and

	 	26.15.4	 	the adequacy, accuracy and/or completeness of any information provided by that
Administrative Finance Party, any other Party or by any other person under or in
connection with any Finance Document, the transactions contemplated by the Finance
Documents or any other agreement, arrangement or document entered into, made or
executed in anticipation of, under or in connection with any Finance Document.

	26.16	 	Reference Banks

If a Reference Bank (or, if a Reference Bank is not a Lender, the Lender of which it is an
Affiliate) ceases to be a Lender, the Agent shall (in consultation with the Company) appoint
another Lender or an Affiliate of a Lender to replace that Reference Bank.

	26.17	 	Management time

Any amount payable to an Administrative Finance Party under Clause 14.3 (Indemnity to the
Agent), Clause 16 (Costs and expenses) and Clause 26.11 (Lenders’ indemnity) shall include
the reasonable cost of utilising that Administrative Finance Party’s management time or
other resources and will be calculated on the basis of such reasonable daily or hourly rates
as that Administrative Finance Party may notify to the Company and the Lenders, and is in
addition to any fee paid or payable to that Administrative Finance Party pursuant to Clause
11 (Fees).

	26.18	 	Deduction

If any Party owes an amount to the Agent under the Finance Documents the Agent may, after
giving notice to that Party, deduct an amount not exceeding that amount from any payment to
that Party which the Agent would otherwise be obliged to make under the Finance Documents
and apply the amount deducted in or towards satisfaction of the amount owed. For the
purposes of the Finance Documents, that Party shall be regarded as having received any
amount so deducted.

	26.19	 	Parallel Debt (Covenant to pay the Security Trustee)

	 	26.19.1	 	Notwithstanding any other provision of this Agreement, each Dutch Obligor hereby
irrevocably and unconditionally undertakes to pay to the Security Trustee, as creditor
in its own right and not as representative of the other Finance Parties, sums equal to
and in the currency of each amount payable by such Dutch Obligor under the Principal
Obligations from time to time due in accordance with the terms and conditions of the
Principal Obligations (such payment undertaking being for the purposes of this Clause
26.19, the “Parallel Debt").

	 	26.19.2	 	The Security Trustee shall have its own independent right to demand payment of the
Parallel Obligations, irrespective of any discharge of such Dutch Obligor’s obligation
to pay those amounts to the other Finance Parties resulting from failure by them to
take appropriate steps, in insolvency proceedings affecting that Dutch Obligor, to
preserve their entitlement to be paid those amounts.

	 	26.19.3	 	Any amount due and payable by a Dutch Obligor to the Security Trustee under the
Parallel Obligations shall be decreased to the extent that the other Finance Parties
have received (and are able to retain) payment in full of the corresponding outstanding
Principal Obligations and any amount due and payable by a Dutch Obligor to the other
Finance Parties under those Principal Obligations shall be decreased to the extent that
the Security Trustee has received (and is able to retain) payment in full of the
corresponding Parallel Obligations.

	 	26.19.4	 	The rights of the Finance Parties (other than the Security Trustee) to receive
payment of the Principal Obligations payable by each Dutch Obligor are several and are
separate and independent from, and without prejudice to, the rights of the Security
Trustee to receive payment under the Parallel Obligations.

	 	26.19.5	 	All monies received or recovered by the Security Trustee pursuant to this Clause
26.19 and enforcement proceeds received or recovered by the Security Trustee pursuant
to this Clause 26.19 (Parallel Debt (Covenant to pay the Security Trustee)) shall be
applied by the Security Trustee in accordance with the terms of this Agreement.

	 	26.19.6	 	For the purposes of this Clause 26.19 (Parallel Debt (Covenant to pay the Security
Trustee)):

	 	(A)	 	“Parallel Obligations” means the monetary obligations arising
from the Parallel Debt; and

	 	(B)	 	“Principal Obligations” means any and all monetary obligations
of the Obligors under or pursuant to the Finance Documents (whether now
existing or hereafter created or arising).

	27.	 	CONDUCT OF BUSINESS BY THE FINANCE PARTIES

No provision of this Agreement will:

	 	27.1.1	 	interfere with the right of any Finance Party to arrange its affairs (tax or
otherwise) in whatever manner it thinks fit;

	 	27.1.2	 	oblige any Finance Party to investigate or claim any credit, relief, remission or
repayment available to it or the extent, order and manner of any claim; or

	 	27.1.3	 	oblige any Finance Party to disclose any information relating to its affairs (tax or
otherwise) or any computations in respect of Tax.

	28.	 	SHARING AMONG THE FINANCE PARTIES

	28.1	 	Payments to Finance Parties

If a Finance Party (a “Recovering Finance Party") receives or recovers any amount from an
Obligor other than in accordance with Clause 29 (Payment mechanics) and applies that amount
to a payment due under the Finance Documents then:

	 	28.1.1	 	the Recovering Finance Party shall, within three Business Days, notify details of the
receipt or recovery, to the Agent;

	 	28.1.2	 	the Agent shall determine whether the receipt or recovery is in excess of the amount
the Recovering Finance Party would have been paid had the receipt or recovery been
received or made by the Agent and distributed in accordance with Clause 29 (Payment
mechanics), without taking account of any Tax which would be imposed on the Agent in
relation to the receipt, recovery or distribution; and

	 	28.1.3	 	the Recovering Finance Party shall, within three Business Days of demand by the
Agent, pay to the Agent an amount (the “Sharing Payment") equal to such receipt or
recovery less any amount which the Agent determines may be retained by the Recovering
Finance Party as its share of any payment to be made, in accordance with Clause 29.5
(Partial payments).

	28.2	 	Redistribution of payments

The Agent shall treat the Sharing Payment as if it had been paid by the relevant Obligor and
distribute it between the Finance Parties (other than the Recovering Finance Party) in
accordance with Clause 29.5 (Partial payments).

	28.3	 	Recovering Finance Party’s rights

	 	28.3.1	 	On a distribution by the Agent under Clause 28.2 (Redistribution of payments), the
Recovering Finance Party will be subrogated to the rights of the Finance Parties which
have shared in the redistribution.

	 	28.3.2	 	If and to the extent that the Recovering Finance Party is not able to rely on its
rights under Clause 28.3.1, the relevant Obligor shall be liable to the Recovering
Finance Party for a debt equal to the Sharing Payment which is immediately due and
payable.

	28.4	 	Reversal of redistribution

If any part of the Sharing Payment received or recovered by a Recovering Finance Party
becomes repayable and is repaid by that Recovering Finance Party, then:

	 	28.4.1	 	each Finance Party which has received a share of the relevant Sharing Payment
pursuant to Clause 28.2 (Redistribution of payments) shall, upon request of the Agent,
pay to the Agent for account of that Recovering Finance Party an amount equal to the
appropriate part of its share of the Sharing Payment (together with an amount as is
necessary to reimburse that Recovering Finance Party for its proportion of any interest
on the Sharing Payment which that Recovering Finance Party is required to pay); and

	 	28.4.2	 	that Recovering Finance Party’s rights of subrogation in respect of any reimbursement
shall be cancelled and the relevant Obligor will be liable to the reimbursing Finance
Party for the amount so reimbursed.

	28.5	 	Exceptions

	 	28.5.1	 	This Clause 28 (Sharing among the Finance Parties) shall not apply to the extent that
the Recovering Finance Party would not, after making any payment pursuant to this
Clause, have a valid and enforceable claim against the relevant Obligor.

	 	28.5.2	 	A Recovering Finance Party is not obliged to share with any other Finance Party any
amount which the Recovering Finance Party has received or recovered as a result of
taking legal or arbitration proceedings, if:

	 	(A)	 	it notified that other Finance Party of the legal or
arbitration proceedings; and

	 	(B)	 	that other Finance Party had an opportunity to participate in
those legal or arbitration proceedings but did not do so as soon as reasonably
practicable having received notice and did not take separate legal or
arbitration proceedings.

6

ADMINISTRATION

	29.	 	PAYMENT MECHANICS

	29.1	 	Payments to the Agent

	 	29.1.1	 	On each date on which an Obligor or a Finance Party is required to make a payment
under a Finance Document, that Obligor or Finance Party shall make the same available
to the Agent (unless a contrary indication appears in a Finance Document) for value on
the due date at the time and in such funds specified by the Agent as being customary at
the time for settlement of transactions in the relevant currency in the place of
payment.

	 	29.1.2	 	Payment shall be made to such account in the principal financial centre of the
country of that currency with such bank as the Agent specifies.

	29.2	 	Distributions by the Agent

Each payment received by the Agent under the Finance Documents for another Party shall,
subject to Clause 29.3 (Distributions to an Obligor) and Clause 29.4 (Clawback) be made
available by the Agent as soon as practicable after receipt to the Party entitled to receive
payment in accordance with this Agreement (in the case of a Lender, for the account of its
Facility Office), to such account as that Party may notify to the Agent by not less than
five Business Days’ notice with a bank in the principal financial centre of the country of
that currency).

	29.3	 	Distributions to an Obligor

The Agent may (with the consent of the Obligor or in accordance with Clause 30 (Set-off))
apply any amount received by it for that Obligor in or towards payment (on the date and in
the currency and funds of receipt) of any amount due from that Obligor under the Finance
Documents or in or towards purchase of any amount of any currency to be so applied.

	29.4	 	Clawback

	 	29.4.1	 	Where a sum is to be paid to the Agent under the Finance Documents for another Party,
the Agent is not obliged to pay that sum to that other Party (or to enter into or
perform any related exchange contract) until it has been able to establish to its
satisfaction that it has actually received that sum.

	 	29.4.2	 	If the Agent pays an amount to another Party and it proves to be the case that the
Agent had not actually received that amount, then the Party to whom that amount (or the
proceeds of any related exchange contract) was paid by the Agent shall on demand refund
the same to the Agent together with interest on that amount from the date of payment to
the date of receipt by the Agent, calculated by the Agent to reflect its cost of funds.

	29.5	 	Partial payments

	 	29.5.1	 	If the Agent receives a payment that is insufficient to discharge all the amounts
then due and payable by an Obligor under the Finance Documents, the Agent shall apply
that payment towards the obligations of that Obligor under the Finance Documents in the
following order:

	 	(A)	 	first, in or towards payment pro rata of any unpaid fees, costs
and expenses of the Administrative Finance Parties under the Finance Documents;

	 	(B)	 	secondly, in or towards payment pro rata of any accrued
interest, commitment fees or commission due but unpaid under the Finance
Documents;

	 	(C)	 	thirdly, in or towards payment pro rata of any principal due
but unpaid under the Finance Documents; and

	 	(D)	 	fourthly, in or towards payment pro rata of any other sum due
but unpaid under the Finance Documents.

	 	29.5.2	 	The Agent shall, if so directed by the Majority Lenders, vary the order set out in
Clauses 29.5.1(B) to 29.5.1(D) above.

	 	29.5.3	 	Clauses 29.5.1 and 29.5.2 above will override any appropriation made by an Obligor.

	29.6	 	No set-off by Obligors

All payments to be made by an Obligor under the Finance Documents shall be calculated and be
made without (and free and clear of any deduction for) set-off or counterclaim.

	29.7	 	Business Days

	 	29.7.1	 	Any payment which is due to be made on a day that is not a Business Day shall be made
on the next Business Day in the same calendar month (if there is one) or the preceding
Business Day (if there is not).

	 	29.7.2	 	During any extension of the due date for payment of any principal or Unpaid Sum under
this Agreement interest is payable on the principal or Unpaid Sum at the rate payable
on the original due date.

	29.8	 	Currency of account

	 	29.8.1	 	Subject to Clauses 29.8.2 and to 29.8.3, dollars is the currency of account and
payment for any sum due from an Obligor under any Finance Document.

	 	29.8.2	 	Each payment in respect of costs, expenses or Taxes shall be made in the currency in
which the costs, expenses or Taxes are incurred.

	 	29.8.3	 	Any amount expressed to be payable in a currency other than dollars shall be paid in
that other currency.

	29.9	 	Change of currency

	 	29.9.1	 	Unless otherwise prohibited by law, if more than one currency or currency unit are at
the same time recognised by the central bank of any country as the lawful currency of
that country, then:

	 	(A)	 	any reference in the Finance Documents to, and any obligations
arising under the Finance Documents in, the currency of that country shall be
translated into, or paid in, the currency or currency unit of that country
designated by the Agent (after consultation with the Company); and

	 	(B)	 	any translation from one currency or currency unit to another
shall be at the official rate of exchange recognised by the central bank for
the conversion of that currency or currency unit into the other, rounded up or
down by the Agent (acting reasonably).

	 	29.9.2	 	If a change in any currency of a country occurs, this Agreement will, to the extent
the Agent (acting reasonably and after consultation with the Company) specifies to be
necessary, be amended to comply with any generally accepted conventions and market
practice in the London interbank market and otherwise to reflect the change in
currency.

	29.10	 	Disruption to Payment Systems etc.

If either the Agent determines (in its discretion) that a Disruption Event has occurred or
the Agent is notified by the Company that a Disruption Event has occurred:

	 	29.10.1	 	the Agent may, and shall if requested to do so by the Company, consult with the
Company with a view to agreeing with the Company such changes to the operation or
administration of the Facility as the Agent may deem necessary in the circumstances;

	 	29.10.2	 	the Agent shall not be obliged to consult with the Company in relation to any
changes mentioned in Clause 29.10.1 if, in its opinion, it is not practicable to do so
in the circumstances and, in any event, shall have no obligation to agree to such
changes;

	 	29.10.3	 	the Agent may consult with the Finance Parties in relation to any changes mentioned
in Clause 29.10.1 but shall not be obliged to do so if, in its opinion, it is not
practicable to do so in the circumstances;

	 	29.10.4	 	any such changes agreed upon by the Agent and the Company shall (whether or not it
is finally determined that a Disruption Event has occurred) be binding upon the Parties
as an amendment to (or, as the case may be, waiver of) the terms of the Finance
Documents notwithstanding the provisions of Clause 35 (Amendments and waivers);

	 	29.10.5	 	the Agent shall not be liable for any damages, costs or losses whatsoever
(including, for negligence, gross negligence or any other category of liability
whatsoever but not including any claim based on the fraud of the Agent) arising as a
result of its taking, or failing to take, any actions pursuant to or in connection with
this Clause 29.10 (Disruption to Payment Systems etc.); and

	 	29.10.6	 	the Agent shall notify the Finance Parties of all changes agreed pursuant to Clause
29.10.4 above.

	30.	 	SET-OFF

A Finance Party may set off any matured obligation due from an Obligor under the Finance
Documents (to the extent beneficially owned by that Finance Party) against any matured
obligation owed by that Finance Party to that Obligor, regardless of the place of payment,
booking branch or currency of either obligation. If the obligations are in different
currencies, the Finance Party may convert either obligation at a market rate of exchange in
its usual course of business for the purpose of the set-off.

	31.	 	NOTICES

	31.1	 	Communication in writing

Any communication in connection with a Finance Document must be in writing and, unless
otherwise stated, may be given in person, by fax or letter.

	31.2	 	Contact details

	 	31.2.1	 	Except as provided in this Clause 31.2 (Contact details), the contact details of each
Party for all communications in connection with the Finance Documents are those
notified by that Party for this purpose to the Agent on or before the date it becomes a
Party.

	 	31.2.2	 	Any Party may change its contact details by giving five Business Days’ notice to the
Facility Agent or (in the case of the Facility Agent) to the other Parties.

	 	31.2.3	 	Where a Party nominates a particular department or officer to receive a
communication, a communication will not be effective if it fails to specify that
department or officer.

	31.3	 	Effectiveness

	 	31.3.1	 	Except as provided in Clause 31.3.2 and Clause 31.3.3, any communication in
connection with a Finance Document will be deemed to be given as follows:

	 	(A)	 	if delivered in person, at the time of delivery; and

	 	(B)	 	if by fax , when received in legible form.

	 	31.3.2	 	A communication given under Clause 31.4.1 but received on a non-working day or after
business hours in the place of receipt will only be deemed to be given on the next
working day in that place.

	 	31.3.3	 	A communication to any Administrative Finance Party will only be effective on actual
receipt by it.

	 	 	 	 	 	 	 
	31.4	 	Obligors	 	 
	
 
	 	 	31.4.1	 	 	All communications under the Finance Documents:

	 	(A)	 	to or from any other Administrative Finance Party (in its
capacity as such) may be made directly to, or as the case may be, come directly
from, that Administrative Finance Party (provided that the relevant
communication is also copied to the Agent); and

	 	(B)	 	to or from any other Finance Party must be sent through the
Agent.

	 	31.4.2	 	All communications under the Finance Documents to or from an Obligor may be sent
through the Company.

	 	31.4.3	 	Each Obligor (other than the Company) irrevocably appoints the Company to act as its
agent:

	 	(A)	 	to give and receive all communications under the Finance
Documents;

	 	(B)	 	to supply all information concerning itself to any Finance
Party; and

	 	(C)	 	to sign all documents under or in connection with the Finance
Documents.

	 	31.4.4	 	Any communication given to the Company in connection with a Finance Document will be
deemed to have been given also to the other Obligors.

	 	31.4.5	 	The Finance Parties may assume that any communication made by the Company is made
with the consent of each other Obligor.

	31.5	 	Electronic Communication

	 	31.5.1	 	Any communication to be made between the Agent and a Lender under or in connection
with the Finance Documents may be made by electronic mail or other electronic means, if
the Agent and the relevant Lender:

	 	(A)	 	agree that, unless and until notified to the contrary, this is
to be an accepted form of communication;

	 	(B)	 	notify each other in writing of their electronic mail address
and/or any other information required to enable the sending and receipt of
information by that means; and

	 	(C)	 	notify each other of any change to their address or any other
such information supplied by them.

	 	31.5.2	 	Any electronic communication made between the Agent and a Lender will be effective
only when actually received in readable form and in the case of any electronic
communication made by a Lender to the Agent only if it is addressed in such a manner as
the Agent shall specify for this purpose.

	 	 	 	 	 
	31.6	 	English language
	
 
	 	31.6.1

31.6.2
	 	Any notice given in connection with a Finance Document must be in English.

Any other document provided in connection with a Finance Document must be:

	 	(A)	 	in English; or

	 	(B)	 	(unless the Agent otherwise agrees) accompanied by a certified
English translation. In this case, the English translation prevails unless the
document is a statutory or other official document.

	32.	 	CALCULATIONS AND CERTIFICATES

	32.1	 	Accounts

In any litigation or arbitration proceedings arising out of or in connection with a Finance
Document, the entries made in the accounts maintained by a Finance Party are prima facie
evidence of the matters to which they relate.

	32.2	 	Certificates and Determinations

Any certification or determination by a Finance Party of a rate or amount under any Finance
Document is, in the absence of manifest error, conclusive evidence of the matters to which
it relates.

	32.3	 	Day count convention

Any interest, commission or fee accruing under a Finance Document will accrue from day to
day and is calculated on the basis of the actual number of days elapsed and a year of 360
days or, in any case where the practice in the London interbank market differs, in
accordance with that market practice.

	33.	 	PARTIAL INVALIDITY

If, at any time, any provision of the Finance Documents is or becomes illegal, invalid or
unenforceable in any respect under any law of any jurisdiction, neither the legality,
validity or enforceability of the remaining provisions nor the legality, validity or
enforceability of such provision under the law of any other jurisdiction will in any way be
affected or impaired.

	34.	 	REMEDIES AND WAIVERS

No failure to exercise, nor any delay in exercising, on the part of any Finance Party, any
right or remedy under the Finance Documents shall operate as a waiver, nor shall any single
or partial exercise of any right or remedy prevent any further or other exercise or the
exercise of any other right or remedy. The rights and remedies provided in this Agreement
are cumulative and not exclusive of any rights or remedies provided by law.

	35.	 	AMENDMENTS AND WAIVERS

	35.1	 	Required consents

	 	35.1.1	 	Subject to Clause 35.2 (Exceptions) any term of the Finance Documents (other than the
Intercreditor Agreement) may be amended or waived only with the consent of the Majority
Lenders and the Obligors and any such amendment or waiver will be binding on all
Parties.

	 	35.1.2	 	Any term of the Intercreditor Agreement may be amended or waived in accordance with
its terms.

	 	35.1.3	 	The Agent may effect, on behalf of any Finance Party, any amendment or waiver
permitted by this Clause.

	 	35.1.4	 	In addition, each Obligor hereby authorises the Company to effect, on its behalf, any
amendment or waiver permitted by this Clause 35 (Amendments and waivers). In any
event, each Party shall take such action as the Agent and/or the Security Trustee may
reasonably request in order to ensure that such amendment or waiver that is permitted
by this Clause 35 (Amendments and waivers) is promptly effected.

	 	 	 	 	 	 	 
	35.2	 	Exceptions
	
 
	 	 	35.2.1	 	 	Any amendment or waiver that has the effect of changing or which relates to:

	 	(A)	 	the definition of “Majority Lenders” in Clause 1.1
(Definitions);

	 	(B)	 	an extension to the date of payment of any amount under the
Finance Documents;

	 	(C)	 	a reduction in the Margin or a reduction in the amount of any
payment of principal, interest, fees or commission payable;

	 	(D)	 	an increase in or an extension of any Commitment;

	 	(E)	 	a change to the Borrowers or Guarantors other than in
accordance with Clause 25 (Changes to the Obligors);

	 	(F)	 	any provision which expressly requires the consent of all the
Lenders;

	 	(G)	 	Clause 2.2 (Finance Parties’ rights and obligations), Clause 24
(Changes to the Lenders) or this Clause 35 (Amendments and waivers); or

	 	(H)	 	the release of any Security granted under any Security Document
save where such release is required pursuant to the terms of any Finance
Document or the release of any Borrower, Guarantor or Transaction Party (in its
capacity as such) that holds any assets that are the subject of any Security
granted under any Security Document;

shall not be made without the prior consent of all the Lenders.

	 	35.2.2	 	Any amendment or waiver which relates to the rights or obligations of any
Administrative Finance Party may not be effected without the consent of that Finance
Party.

	 	35.2.3	 	Any term of any Fee Letter relating to the payment of fees to any Administrative
Party for its own account may be amended or waived by the relevant Administrative
Finance Party without the prior consent of the Majority Lenders.

	36.	 	COUNTERPARTS

Each Finance Document may be executed (if such execution shall be valid under the laws of
the jurisdiction by which such Finance Document is expressed to be governed) in any number
of counterparts, and this has the same effect as if the signatures on the counterparts were
on a single copy of the Finance Document.

7

GOVERNING LAW AND ENFORCEMENT

	37.	 	GOVERNING LAW

This Agreement is governed by English law.

	38.	 	ENFORCEMENT

	38.1	 	Jurisdiction

	 	38.1.1	 	The courts of England have exclusive jurisdiction to settle any dispute arising out
of or in connection with this Agreement (including a dispute regarding the existence,
validity or termination of this Agreement) (a “Dispute").

	 	38.1.2	 	The Parties agree that the courts of England are the most appropriate and convenient
courts to settle Disputes and accordingly no Party will argue to the contrary.

	 	38.1.3	 	This Clause 38.1 (Jurisdiction) is for the benefit of the Finance Parties only. As a
result, no Finance Party shall be prevented from taking proceedings relating to a
Dispute in any other courts with jurisdiction. To the extent allowed by law, the
Finance Parties may take concurrent proceedings in any number of jurisdictions.

	38.2	 	Service of process

	 	38.2.1	 	Without prejudice to any other mode of service allowed under any relevant law, each
Obligor (other than an Obligor incorporated in England and Wales):

	 	(A)	 	irrevocably appoints Endeavour Energy UK Limited as its agent
for service of process in relation to any proceedings before the English courts
in connection with any Finance Document; and

	 	(B)	 	agrees that failure by a process agent to notify the relevant
Obligor of the process will not invalidate the proceedings concerned.

	 	38.2.2	 	Each of the Obligors expressly agrees and consents to the provisions of this Clause
38 (Enforcement) and Endeavour Energy UK Limited hereby confirm its acceptance of such
appointment.

	38.3	 	Waiver of immunity

Each Obligor irrevocably and unconditionally:

	 	38.3.1	 	agrees not to claim any immunity from proceedings brought by a Finance Party against
that Obligor in relation to a Finance Document and to ensure that no such claim is made
on its behalf;

	 	38.3.2	 	consents generally to the giving of any relief or the issue of any process in
connection with those proceedings; and

	 	38.3.3	 	waives all rights of immunity in respect of it or its assets.

This Agreement has been entered into on the date stated at the beginning of this Agreement.

8

SCHEDULE 1

THE ORIGINAL OBLIGORS

Part I

THE ORIGINAL BORROWER

Name of Original Borrower Registration number (or equivalent, if any) Jurisdiction of incorporation

Endeavour International Holding B.V. 34229293 Netherlands

Part II

THE ORIGINAL GUARANTORS

	 	 	 	 	 
	Endeavour International Corporation.

Endeavour Operating Corporation

END Operating Management Company

END Management Company

Endeavour International Holding B.V.

Endeavour Energy UK Limited

Endeavour Energy Netherlands B.V.

	 	C897-2000

3737839

3900636

3737839

34229293

5030838

34229296
	 	Nevada, U.S.A

Delaware, U.S.A

Delaware, U.S.A

Delaware, U.S.A

Netherlands

England and Wales

Netherlands

9

SCHEDULE 2

THE ORIGINAL LENDERS

	 	 	 	 	 
	Original Lender	 	Commitment
	BNP Paribas
	 	$	12,500,000	 
	Bank of Scotland Plc
	 	$	12,500,000	 

10

SCHEDULE 3

CONDITIONS PRECEDENT

Part I

CPs to first Loan

	1.	 	OBLIGORS AND TRANSACTION PARTIES

	1.1	 	A copy of the constitutional documents of each Obligor.

	1.2	 	A copy of a resolution of the respective board of directors of each Obligor (or a committee
of its board of directors) and of the respective general meeting of shareholders of each Dutch
Obligor:

	 	1.2.1	 	approving the terms of, and the transactions contemplated by, such of the
Finance Documents that it is or will become party to;

	 	1.2.2	 	authorising a specified person or persons to execute each such document on its
behalf; and

	 	1.2.3	 	authorising a specified person or persons, on its behalf, to sign and/or
dispatch all other documents and notices to be signed and/or dispatched by it under or
in connection with any such document.

	1.3	 	If applicable, a copy of a resolution of the board of directors of each relevant Obligor
establishing the committee referred to in paragraph 1.2 above.

	1.4	 	For each Obligor, a specimen of the signature of each person authorised by the resolutions
referred to in paragraph 1.2 above.

	2.	 	CERTIFICATES

	2.1	 	A certificate of an authorised signatory of each Obligor certifying on behalf of that Obligor
that:

	 	2.1.1	 	the borrowing or, as the case may be, the guaranteeing of the Aggregate
Commitments in full would not cause any borrowing, guaranteeing or similar limit
binding on it to be exceeded; and

	 	2.1.2	 	each copy document specified in Paragraph 1 of Part I of Schedule 3 relating
to it is correct, complete and in full force and effect as at a date no earlier than
the date of this Agreement.

	2.2	 	A certificate of a person who is both a director and an authorised signatory of the Company
confirming that no Default has occurred and is continuing.

	3.	 	FINANCE AND OTHER DOCUMENTS

	 	 	 	 	 
	3.1	 	Originals of the following documents duly executed by all parties to them and in full force and effect:
	
 
	 	3.1.1

3.1.2
	 	the Fee Letter;

an amendment and restatement agreement relating to the Intercreditor Agreement;

	 	3.1.3	 	any other side letter or ancillary document the form of which has been agreed
between the Company and Mandated Lead Arrangers on or before the date of this
Agreement.

	4.	 	OTHER EVIDENCE AND DOCUMENTS

	4.1	 	The Original Financial Statements for the Company and each other Obligor.

	4.2	 	Evidence that all fees (including legal fees and fees due and payable under the Fee Letters)
due and payable have been or will be paid on the first Utilisation Date.

	4.3	 	Confirmation from the Finance Parties that they have completed all “know your customer”
requirements to their satisfaction.

	4.4	 	Evidence that an irrevocable notice of prepayment and cancellation with respect to all of the
credit facilities under the Existing Second Lien Facility has been issued.

	4.5	 	Evidence that the Original Borrower will release or cause to be released the proceeds of the
first Loan made hereunder, once it or any person on its behalf is satisfied that it or the
Original Borrower has obtained all necessary ancillary funding to allow the discharge in full
of the debt under the Existing Second Lien Facility.

	4.6	 	Evidence that upon receipt of the proceeds of the first Loan made hereunder, the lenders
under the Existing Second Lien Facility will provide a confirmation to the Security Trustee
(in a form agreed between such lenders and the Security Trustee prior to the first Utilisation
Date) with respect to the discharge of the debt under the Existing Second Lien Facility.

	4.7	 	Evidence that all consents required under the First Lien Credit Agreement (and any related
finance documents) in order for this Agreement to be entered into, and for the transactions
contemplated hereunder to be completed, have been so obtained.

	5.	 	LEGAL OPINIONS

	 	 	 
	5.1

5.2

5.3

5.4

5.5

	 	A legal opinion of Herbert Smith LLP.

A legal opinion of Stibbe N.V.

A legal opinion of Bracewell & Giuliani LLP.

A legal opinion of Rice, Silbey, Reuther & Sullivan.

A legal opinion of Wikborg, Rein & Co.

	6.	 	AUTHORISATIONS

	6.1	 	Confirmation from the Obligors that all relevant authorisations necessary in connection with
the Transaction Documents have been obtained and are in full force and effect or will be in
full force and effect when required.

11

SCHEDULE 3

CONDITIONS PRECEDENT

Part II

Conditions precedent required to be delivered by an Additional Obligor

	1.	 	An Accession Letter, duly executed by the Additional Obligor and the Company and duly
executed originals of any other documents (in form and substance satisfactory to the Agent) as
may be necessary to ensure that the Additional Obligors accedes, and becomes a party, to each
relevant Finance Document (“accession documents").

	2.	 	A copy of the constitutional documents of the Additional Obligor and any other person (an
“Additional Transaction Party") entering into any Security Documents referred to in paragraph
12 below.

	3.	 	A copy of a resolution of the respective board of directors (or equivalent) of (a) the
Additional Obligor and (b) any Additional Transaction Party, in each case:

	 	3.1	 	approving the terms of, and the transactions contemplated by, each of the
documents it is or will become party to (the “Relevant Documents");

	 	3.2	 	authorising a specified person or persons to execute each such Relevant
Document on its behalf; and

	 	3.3	 	authorising a specified person or persons, on its behalf, to sign and/or
despatch all other documents and notices (including, in relation to an Additional
Borrower, any Utilisation Request or a Selection Notice) to be signed and/or despatched
by it under or in connection with any such Relevant Document.

	4.	 	A specimen of the signature of each person authorised by the resolution referred to in
paragraph 3 above.

	5.	 	In the case of an Additional Guarantor, a copy of a resolution signed by all the holders of
the issued shares of the Additional Guarantor, approving the terms of, and the transactions
contemplated by, the Finance Documents to which the Additional Guarantor is, or will become, a
party.

	6.	 	A certificate of the Additional Obligor (signed by a director or, if appropriate, an officer)
confirming that borrowing or guaranteeing, as appropriate, the Aggregate Commitments would not
cause any borrowing, guaranteeing or similar limit binding on it to be exceeded.

7. A certificate of an authorised signatory of:

7.1 the Additional Obligor; and

7.2 each Additional Transaction Party (if any)

(in each case) certifying that each copy document listed in this Part IV of Schedule 3
relating to it is correct, complete and in full force and effect as at a date no earlier
than the date of the Relevant Document(s) to which it is a party.

	8.	 	A copy of any other Authorisation or other document, opinion or assurance which the Agent
considers to be necessary or desirable in connection with the entry into and performance of
the transactions contemplated by each Relevant Document or for the validity and enforceability
of any Relevant Document.

	9.	 	If available, the latest audited financial statements of the Additional Obligor.

	10.	 	Such legal opinions in relation to the Additional Obligor, any Additional Transaction Party
and/or the Relevant Documents as the Agent may reasonably require (together with any documents
that may be required for the delivery of such legal opinions).

	11.	 	If the proposed Additional Obligor is incorporated in a jurisdiction other than England and
Wales, evidence that the process agent specified in Clause 38.2 (Service of process), if not
an Obligor, has accepted its appointment in relation to the proposed Additional Obligor.

	12.	 	Security Document(s) creating Security over (a) the entire issued share capital of the
Additional Obligor, (b) if required by the Majority Lenders, all of the assets of the
Additional Obligor, in the case of (a) and (b) duly executed by the relevant parties in form
and substance satisfactory to the Security Trustee together with:

	 	12.1	 	(to the extent applicable) evidence that all approvals, filings, registrations,
recordings and other things necessary or desirable (including the carrying out of the
procedures specified in ss.155-8 of the Companies Act 1985 (if appropriate)) to ensure
the validity, effectiveness, priority and enforceability of each such Security Document
have been carried out;

	 	12.2	 	copies of each of the notices required to be given under each such Security
Document together with other copies of acknowledgements from each person to whom notice
was given, in the form required by such document; and

	 	12.3	 	(if required by the Agent) evidence that the Security Trustee or its nominee
has been entered in the register of members (or equivalent) of such proposed Additional
Obligor as sole shareholder of all its issued share capital.

	14.	 	Evidence that all “know your customer” or similar identification procedures relating to the
proposed Additional Obligor or any Additional Transaction Party have been carried out and
completed.

12

SCHEDULE 4

REQUESTS

Part I

Utilisation Request

	 	 	 
	From:

To:

	 	[Borrower]

[Agent]

Dated:

Dear Sirs

Junior Facility Agreement dated [                  ] between, among others, Endeavour International

Corporation, BNP Paribas and Bank of Scotland plc (as amended from time to time) (the “Agreement”)

	1.	 	We refer to the Agreement. This is a Utilisation Request. Terms defined in the Agreement
have the same meaning in this Utilisation Request unless given a different meaning in this
Utilisation Request.

	2.	 	We wish to borrow a Loan on the following terms:

	 	 	 	Proposed Utilisation Date: [       ] (or, if that is not a Business Day, the next Business
Day)

	 	 	 
	Amount:

Currency:

Interest Period:

	 	[       ]

dollars

[       ]

3. The purpose of the Loan is [                              ].

	4.	 	We confirm that each condition specified in Clause 4 (Conditions of Utilisation) of the
Agreement are or will be satisfied on the date of this Utilisation Request.

5. The proceeds of this Loan should be credited to [ ].

6. This Utilisation Request is irrevocable.

Yours faithfully

.......................................

authorised signatory for

[name of relevant Borrower]

13

SCHEDULE 4

REQUESTS

Part II

Selection Notice

	 	 	 
	From:

To:

	 	[Borrower]

[Agent]

Dated:

Dear Sirs

Junior Facility Agreement dated [                   ] between, among others, Endeavour

International Corporation, BNP Paribas and Bank of Scotland plc (as amended from time to time) (the

“Agreement”)

	1.	 	We refer to the Agreement. This is a Selection Notice. Terms defined in the Agreement have
the same meaning in this Selection Notice unless given a different meaning in this Selection
Notice.

	2.	 	We refer to the following Loan[s] with an Interest Period ending on
[                  ]*.

	3.	 	[We request that the above Loan[s] be divided into [                ] Loans with the
following Amounts and Interest Periods:]**

	 	 	 
	4.

	 	or

[We request that the next Interest Period for the above Loan[s] is [           ]].***

This Selection Notice is irrevocable.

Yours faithfully

.......................................

authorised signatory for

[name of relevant Borrower]

* Insert details of all Loans in the same
currency which have an Interest Period ending on the same date.

** Use this option if division of
Loans is requested.

*** Use this option if sub-division is not
required.

14

SCHEDULE 5

MANDATORY COST FORMULAE

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

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

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

	4.	 	The Additional Cost Rate for any Lender lending from a Facility Office in the United Kingdom
will be calculated by the Agent as follows:

	 	 	 
	4.1

	 	in relation to a sterling Loan:
	
 
	 	AB + C(B — D) +E x 0.01 per cent. per annum
	
 
	 	 
	4.2

	 	100 – (A + C)

in relation to a Loan in any currency other than sterling:

E x 0.01 per cent. per annum

300

	 	 	 	Where:

	 	 	 	A            is the percentage of Eligible Liabilities (assuming these to be in excess of any
stated minimum) which that Lender is from time to time required to maintain as an
interest free cash ratio deposit with the Bank of England to comply with cash ratio
requirements.

	 	 	 	B            is the percentage rate of interest (excluding the Margin and the Mandatory Cost
and, if the Loan is an Unpaid Sum, the additional rate of interest specified in Clause
8.3.1 (Default interest)) payable for the relevant Interest Period on the Loan.

	 	 	 	C            is the percentage (if any) of Eligible Liabilities which that Lender is required
from time to time to maintain as interest bearing Special Deposits with the Bank of
England.

	 	 	 	D            is the percentage rate per annum payable by the Bank of England to the Agent on
interest bearing Special Deposits.

	 	 	 	E            is designed to compensate Lenders for amounts payable under the Fees Rules and
is calculated by the Agent as being the average of the most recent rates of charge
supplied by the Reference Banks to the Agent pursuant to paragraph 7 below and
expressed in pounds per £1,000,000.

	5.	 	For the purposes of this Schedule:

	5.1	 	"Eligible Liabilities” and “Special Deposits” have the meanings given to them from time to
time under or pursuant to the Bank of England Act 1998 or (as may be appropriate) by the Bank
of England;

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

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

	5.4	 	"Tariff Base” has the meaning given to it in, and will be calculated in accordance with, the
Fees Rules.

	6.	 	In application of the above formulae, A, B, C and D will be included in the formulae as
percentages (i.e. 5 per cent. will be included in the formula as 5 and not as 0.05). A
negative result obtained by subtracting D from B shall be taken as zero. The resulting
figures shall be rounded to four decimal places.

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

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

	 	 	 
	8.1

8.2

	 	the jurisdiction of its Facility Office; and

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

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

	9.	 	The percentages of each Lender for the purpose of A and C above and the rates of charge of
each Reference Bank for the purpose of E above shall be determined by the Agent based upon the
information supplied to it pursuant to paragraphs 7 and 8 above and on the assumption that,
unless a Lender notifies the Agent to the contrary, each Lender’s obligations in relation to
cash ratio deposits and Special Deposits are the same as those of a typical bank from its
jurisdiction of incorporation with a Facility Office in the same jurisdiction as its Facility
Office.

	10.	 	The Agent shall have no liability to any person if such determination results in an
Additional Cost Rate which over or under compensates any Lender and shall be entitled to
assume that the information provided by any Lender or Reference Bank pursuant to paragraphs 3,
7 and 8 above is true and correct in all respects.

	11.	 	The Agent shall distribute the additional amounts received as a result of the Mandatory Cost
to the Lenders on the basis of the Additional Cost Rate for each Lender based on the
information provided by each Lender and each Reference Bank pursuant to paragraphs 3, 7 and 8
above.

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

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

15

SCHEDULE 6

FORM OF TRANSFER CERTIFICATE

	 	 	 
	To:

From:

Dated:

	 	[Agent] and [Security Trustee]

[The Existing Lender] (the “Existing Lender") and [The New Lender] (the “New Lender")

Dear Sirs

Junior Facility Agreement dated [             ] between, among others, Endeavour International

Corporation, BNP Paribas and Bank of Scotland (as amended from time to time) (the “Agreement”)

	1.	 	We refer to the Agreement. This is a Transfer Certificate. Terms defined in the Agreement
have the same meaning in this Transfer Certificate unless given a different meaning in this
Transfer Certificate.

	2.	 	We refer to Clause 24.5 (Procedure for transfer) of the Agreement:

	2.1.	 	The Existing Lender and the New Lender agree to the Existing Lender transferring to the New
Lender by novation all or part of the Existing Lender’s Commitment, rights and obligations
referred to in the Schedule hereto in accordance with Clause 24.5 (Procedure for transfer) of
the Agreement.

	2.2	 	The proposed Transfer Date is [                ].

	2.3	 	The Facility Office and address, fax number and attention details for notices of the New
Lender for the purposes of Clause 31.2 (Contact details) of the Agreement are set out in the
Schedule.

	 	 	 
	[3.

	 	The New Lender confirms that the person beneficially entitled to interest

payable to that Lender in respect of an advance under a Finance Document

is either:
	3.1

3.2

	 	a company resident in the United Kingdom for United Kingdom tax purposes;

a partnership each member of which is:

(i) a company so resident in the United Kingdom; or

	 	(ii)	 	a company not so resident in the United Kingdom which carries on a trade in the
United Kingdom through a permanent establishment and which brings into account in
computing its chargeable profits (for the purposes of section 11(2) of the Taxes Act)
the whole of any share of interest payable in respect of that advance that falls to it
by reason of sections 114 and 115 of the Taxes Act; or

	3.3	 	a company not so resident in the United Kingdom which carries on a trade in the United
Kingdom through a permanent establishment and which brings into account interest payable in
respect of that advance in computing the chargeable profits (for the purposes of section 11(2)
of the Taxes Act) of that company.]

	 	 	 
	[4/5.]

[5/6.]

[6/7.]

	 	This Transfer Certificate may be executed in any number of

counterparts and this has the same effect as if the signatures on the

counterparts were on a single copy of this Transfer Certificate.

The New Lender agrees to become a party to, and be bound by the terms

of the Agreement and Intercreditor Agreement as a Lender on and from

the Transfer Date.

This Transfer Certificate is governed by English law.

16

THE SCHEDULE

Commitment/rights and obligations to be transferred

[insert relevant details including details of Commitment and participation amount and whether any

Secured Hedging Agreement is to be transferred]

[Facility Office address, fax number and attention details for notices and account details for

payments.]

	 	 	 	 	 
	[Existing Lender]

By:

	 	By:
	 	[New Lender]

This Transfer Certificate is accepted by the Agent and the Transfer Date is confirmed as
[              ].

[Agent]

By:

This Transfer Certificate is accepted by the Security Trustee.

[Security Trustee]

By:

17

SCHEDULE 7

FORM OF ACCESSION LETTER

	 	 	 
	To:

From:

	 	[Agent] and [Security Trustee]

[Subsidiary] and [Company]

Dated:

Dear Sirs

Junior Facility Agreement dated [                      ] between, among others, Endeavour

International Corporation, BNP Paribas and Bank of Scotland plc (as amended from time to time) (the

“Agreement”)

	1.	 	We refer to the Agreement. This is an Accession Letter. Terms defined in the Agreement have
the same meaning in this Accession Letter unless given a different meaning in this Accession
Letter.

	2.	 	[Subsidiary] agrees to become an Additional [Borrower]/[Guarantor] and to be bound by (i) the
terms of the Agreement and the Intercreditor Agreement as an Obligor and (ii) the terms of the
other Finance Documents as an Additional [Borrower]/[Guarantor] pursuant to [Clause 25.2
(Additional Borrowers)] [Clause 25.3 (Additional Guarantors)] of the Agreement. [Subsidiary]
is a company duly incorporated under the laws of [name of relevant jurisdiction].

4. [Subsidiary’s] administrative details are as follows:

Address:

Fax No:

Attention:

5. This Accession Letter is governed by English law.

[This Accession Letter has been executed and delivered as a deed on the date stated at the
beginning of this Accession Letter.]0

Yours faithfully,

	 	 	 
	..........................

authorised signatory for

[name of relevant Subsidiary]

	 	..........................

authorised signatory for

[Company]

This Accession Letter is accepted by the Agent and the Security Trustee.

[Agent]

By:

[Security Trustee]

By:

	0	 	If to be entered by way of deed, execution
blocks must be amended appropriately.

18

SCHEDULE 8

GROUP STRUCTURE

Omitted

19

SIGNATORIES

	 	 	 	 	 	 	 	 	 
	SIGNED by
	 	 	)	 	 	 	 	 
	 
	 	)/s/ William L. Transier	 	 	 	 
	for and on behalf of
	 	 	)	 	 	 	 	 
	ENDEAVOUR INTERNATIONAL
	 	)/s/ J. Michael Kirksey	 	 	 	 
	CORPORATION
	 	 	)	 	 	 	 	 
	SIGNED by
	 	 	)	 	 	 	 	 
	 
	 	) /s/ William L. Transier	 	 	 	 
	for and on behalf of
	 	 	)	 	 	 	 	 
	ENDEAVOUR OPERATING
	 	) /s/ J. Michael Kirksey	 	 	 	 
	CORPORATION
	 	 	)	 	 	 	 	 
	SIGNED by
	 	 	)	 	 	 	 	 
	 
	 	) /s/ William L. Transier	 	 	 	 
	for and on behalf of
	 	 	)	 	 	 	 	 
	END OPERATING
	 	) /s/ J. Michael Kirksey	 	 	 	 
	MANAGEMENT COMPANY
	 	 	 	 	 	 	)	 
	SIGNED by
	 	 	)	 	 	 	 	 
	 
	 	) /s/ William L. Transier	 	 	 	 
	for and on behalf of
	 	 	)	 	 	 	 	 
	END MANAGEMENT
	 	) /s/ J. Michael Kirksey	 	 	 	 
	COMPANY
	 	 	)	 	 	 	 	 
	SIGNED by
	 	 	)	 	 	 	 	 
	 
	 	) /s/ William L. Transier	 	 	 	 
	for and on behalf of
	 	 	)	 	 	 	 	 
	ENDEAVOUR INTERNATIONAL
	 	) /s/ J. Michael Kirksey	 	 	 	 
	HOLDING B.V.
	 	 	 	 	 	 	)	 
	SIGNED by
	 	 	)	 	 	 	 	 
	 
	 	) /s/ William L. Transier	 	 	 	 
	for and on behalf of
	 	 	)	 	 	 	 	 
	ENDEAVOUR ENERGY
	 	 	)	 	 	 	 	 
	NETHERLANDS B.V.
	 	 	)	 	 	 	 	 
	SIGNED by
	 	) /s/ William L. Transier	 	 	 	 
	 
	 	 	)	 	 	 	 	 
	for and on behalf of
	 	) /s/ J. Michael Kirksey	 	 	 	 
	ENDEAVOUR ENERGY UK LIMITED
	 	 	)	 	 	 	 	 
	SIGNED by
	 	 	)	 	 	 	 	 
	 
	 	)/s/ Aurelie Guth	 	 	 	 
	for and on behalf of
	 	 	)	 	 	 	 	 
	BNP PARIBAS
	 	 	)	 	 	 	 	 
	(in all capacities in which it is party
	 	)/s/ Remi Collognes-Dufoleur	 	 	 	 
	to this Agreement)
	 	 	)	 	 	 	 	 
	SIGNED by
	 	 	)	 	 	 	 	 
	 
	 	 	)	 	 	 	 	 
	for and on behalf of
	 	)/s/ Carol Kemp	 	 	 	 
	BANK OF SCOTLAND PLC
	 	 	)	 	 	 	 	 
	(in all capacities in which it is party
	 	)Carol Kemp	 	 	 	 
	to this Agreement)
	 	 	)	 	 	 	 	 

20EX-10.1

AGREEMENT AND DECLARATION OF TRUST

AGREEMENT AND DECLARATION OF TRUST, dated as of January 22, 2008, by and among G REIT, Inc., a
Maryland corporation (the “Company”) and Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet
Wallace and Gary T. Wescombe (the “Trustees”).

WHEREAS, the Company’s Board of Directors (the “Board”), a Special Committee of the Board, and
the Company’s stockholders have approved the dissolution of the Company pursuant to a Plan of
Liquidation and Dissolution (the “Plan”);

WHEREAS, the Plan provides, among other things, that the Board will cause the Company to
dispose of all of the assets of the Company, wind up its affairs, pay or adequately provide for the
payment of all of its liabilities and distribute to or for the benefit of its stockholders all of
the Company’s assets;

WHEREAS, as of the date hereof, substantially all of the assets of the Company have been sold
or otherwise disposed of;

WHEREAS, the Board believes it to be in the best interest of the Company to complete the
liquidation of the Company by transferring all remaining assets of the Company to a liquidating
trust (the “Trust”) on the Transfer Date with the Trustees serving as the initial trustees,
including a cash reserve set aside for the contingent and existing obligations of the Company and
the Trust (the “Cash Reserve”);

WHEREAS, the Trustees shall administer the Trust pursuant to the terms of this Agreement and,
upon satisfaction of all liabilities and obligations of the Company and the Trust, the Trustees
shall distribute the residue of the proceeds of the liquidation of the assets of the Company in
accordance with the terms hereof; and

WHEREAS, immediately prior to the transfer and assumption of the Company’s assets and
liabilities, the Company will become the owner of 100% of the interests in the Company’s operating
partnership, and, in connection with the simultaneous dissolution of the operating partnership, all
of the assets and liabilities of the operating partnership will be transferred and assigned to, and
assumed by, the Company;

NOW THEREFORE, in consideration of the premises and other valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

NAMES AND DEFINITIONS

1.1 Name. The Trust shall be known as the G REIT Liquidating Trust.

1.2 Defined Terms. For all purposes of this instrument, unless the context otherwise
requires:

(a) “Affiliate” of any Person means any entity that controls, is controlled by, or is
under common control with such Person. As used herein, “control” means the possession,
directly or indirectly, of the power to direct or cause the direction of the management and
policies of such entity, whether through ownership of voting securities or other interests,
by contract or otherwise.

(b) “Agreement” shall mean this instrument as originally executed or as it may from
time to time be amended pursuant to the terms hereof.

(c) “Beneficial Interest” shall mean each Beneficiary’s proportionate share of the
Trust Assets determined by the ratio of the number of Units held by such Beneficiary to the
total number of Units held by all Beneficiaries.

(d) “Beneficiary” shall mean each holder of Units.

(e) “Liabilities” shall mean all of the Company’s unsatisfied debts, claims,
liabilities, commitments, suits and other obligations, whether contingent or fixed or
otherwise (including, without limitation, any costs and expenses incurred or to be incurred
in connection with the liquidation of the Company).

(f) “Person” shall mean an individual, a corporation, a partnership, an association, a
joint stock company, a limited liability company, a trust, a joint venture, any
unincorporated organization, or a government or political subdivision thereof.

(g) “Record Date” shall mean January 22, 2008.

(h) “Retained Assets” shall mean all of the Company’s right, title and interest in, to
and under, all of the Company’s assets, including, without limitation, its unsold
properties, interests in legal entities, accounts receivable, cash, securities, claims,
causes of action, contingent claims and reserves distributed to the Trustee.

(i) “Shares” shall mean the shares of common stock, $0.01 par value per share, of the
Company.

(j) “Stockholders” shall mean the holders of record of the outstanding Shares of the
Company at the close of business on the Record Date.

(k) “Transfer Date” shall mean January 28, 2008.

(l) “Trust” shall mean the Trust created by this Agreement.

(m) “Trust Assets” shall mean all the property held from time to time by the Trustee
under this Agreement, which initially shall consist of the Retained Assets (excluding any
liquidating distributions declared, but unpaid, having a record date prior to the Transfer
Date), and in addition, shall thereafter include all dividends, distributions, rents,
royalties, income, payments and recoveries of claims, proceeds and other receipts of, from,
or attributable to any assets held by the Trust, less any of the foregoing utilized by the
Trustee to pay expenses of the Trust, satisfy Liabilities or to make distributions to the
Beneficiaries pursuant to the terms and conditions hereof.

(n) “Trustees” shall mean, Gary H. Hunt, W. Brand Inlow, Edward A. Johnson, D. Fleet
Wallace and Gary T. Wescombe, the initial Trustees under this Agreement, and any successors
thereto, pursuant to and in accordance with the terms of this Agreement.

(o) “Units” shall have the meaning given to such term in Section 3.1(a).

ARTICLE II

GRANT TO AND NATURE OF TRANSFER

2.1 Formation. The Company hereby grants, delivers, releases, assigns and conveys to
the Trustees, and the Trustees hereby accepts, the sum of $100 to be held in trust for the benefit
of the Beneficiaries of the Trust,

2.2 Grant. On the Transfer Date, the Company shall grant, deliver, release, assign
and convey to the Trustees, to be held in trust for the benefit of the Beneficiaries of the Trust,
all of the Company’s right, title, interest in, to and under, the Retained Assets, for the uses and
purposes stated herein, subject to the terms and provisions set out below, and the Trustees agree
to accept such Retained Assets, subject to the following terms and provisions.

2.3 Purpose of Trust.

(a) The Trust is organized for the sole purpose of winding up the Company’s affairs
and the liquidation of the Retained Assets with no objective to continue or engage in the
conduct of a trade or business, except as necessary for the orderly liquidation of the
Trust Assets.

(b) The Retained Assets granted, assigned and conveyed to the Trustees shall be held
in the Trust, and the Trustees will (i) further liquidate the Trust Assets as it deems
necessary to carry out the purpose of the Trust and facilitate distribution of the Trust
Assets, (ii) allocate, protect, conserve and manage the Trust Assets in accordance with the
terms and conditions hereof, (iii) complete the winding up of the Company’s affairs, (iv)
act on behalf of the Beneficiaries, and (v) distribute the Trust Assets in accordance with
the terms and conditions hereof.

(c) It is intended that for federal, state and local income tax purposes, the Trust
shall be treated as a liquidating trust under Treasury Regulation Section 301.7701-4(d) and
any analogous provision of state or local law, and the Beneficiaries shall be treated as
the owners of their respective share of the Trust pursuant to Sections 671 through 679 of
the Internal Revenue Code of 1986, as amended (the “Code”) and any analogous provision of
state or local law, and shall be taxed on their respective share of the Trust’s taxable
income (including both ordinary income and capital gains) pursuant to Section 671 of the
Code and any analogous provision of state or local law. The Trustees shall file all tax
returns required to be filed with any governmental agency consistent with this position,
including, but not limited to, any returns required of grantor trusts pursuant to Treasury
Regulation Section 1.671-4(a).

2.4 No Reversion to the Company. In no event shall any part of the Trust Assets
revert to or be distributed to the Company.

2.5 Instruments of Further Assurance. The Company will, upon reasonable request of
the Trustees, execute, acknowledge, and deliver such further instruments and do such further acts
as may be necessary or proper to carry out effectively the purposes of this Agreement, to confirm
or effectuate the transfer to the Trustees of any property intended to be covered hereby, and to
vest in the Trustees and its successors and assigns, the estate, powers, instruments or funds in
trust hereunder.

2.6 Payment of Liabilities. The Trustees, in their capacity as Trustees hereunder and
not in their individual capacities, shall assume all Liabilities and agrees to cause the Trust to
pay, discharge and perform when due all of the Liabilities on and as of the Transfer Date. Should
any Liability be asserted against the Trustees as the transferee of the Trust Assets or as a result
of the assumption made in this Section 2.6, the Trustees may use such part of the Trust Assets as
may be necessary in contesting any such Liability or in payment thereof, but in no event shall the
Trustees, Beneficiaries or agents of the Trust be personally liable, nor shall resort be had to the
private property of such Persons, in the event that the Trust Assets are not sufficient to satisfy
the Liabilities.

ARTICLE III

BENEFICIARIES

3.1 Beneficial Interests.

(a) The Beneficial Interest of each Stockholder shall be determined in accordance with
a certified copy of the Company’s stockholder list as of the Record Date. The Company will
deliver such a certified copy of the Company’s stockholder list to the Trustees within a
reasonable time after such date. The Trustees shall be entitled to rely and shall be fully
protected in relying upon the certified copy of the Company’s stockholder list. For ease
of administration, the Trustees shall express the Beneficial Interest of each Beneficiary
in terms of units (“Units”). Each record owner of Shares as of the close of business on
the Record Date shall receive one Unit for each Share then held of record. Each
Beneficiary shall have a pro rata interest in the Trust Assets equal to the number of Units
held by such owner divided by the total number of Units held by all Beneficiaries.

(b) On and after the Transfer Date, all outstanding Shares shall be deemed cancelled
automatically.

(c) The rights of Beneficiaries in, to and under the Trust Assets and the Trust shall
not be represented by any form of certificate or other instrument, and no Beneficiary shall
be entitled to such a certificate. The Trustees shall maintain at their place of business
a record of the name and address of each Beneficiary and such Beneficiary’s aggregate Units
in the Trust.

(d) If any conflicting claims or demands are made or asserted with respect to the
ownership of any Units, or if there is any disagreement between the transferees, assignees,
heirs, representatives or legatees succeeding to all or part of the interest of any
Beneficiary resulting in adverse claims or demands being made in connection with such
Units, then, in any of such events, the Trustees shall be entitled, at their sole election,
to refuse to comply with any such conflicting claims or demands. In so refusing, the
Trustees may elect to make no payment or distribution with respect to such Units, or to
make such payment to a court of competent jurisdiction or an escrow agent, and in so doing,
the Trustees shall not be or become liable to any of such parties for its failure or
refusal to comply with any of such conflicting claims or demands or to take any other
action with respect thereto, nor shall the Trustees be liable for interest on any funds
which it may so withhold. Notwithstanding anything to the contrary set forth in this
Section 3.1(d), the Trustees shall be entitled to refrain and refuse to act until either
(i) the rights of the adverse claimants have been adjudicated by a final judgment of a
court of competent jurisdiction, (ii) all differences have been adjusted by valid written
agreement between all of such parties, and the Trustees shall have been furnished with an
executed counterpart of such agreement, or (iii) there is furnished to the Trustees a
surety bond or other security satisfactory to the Trustees, as they shall deem appropriate,
to fully indemnify them as between all conflicting claims or demands.

3.2 Rights of Beneficiaries. Each Beneficiary shall be entitled to participate in the
rights and benefits due to a Beneficiary hereunder according to the Beneficiary’s Beneficial
Interest. Each Beneficiary shall take and hold the same subject to all the terms and provisions of
this Agreement. The interest of each Beneficiary hereunder is declared, and shall be in all
respects, personal property and upon the death of an individual Beneficiary, the Beneficiary’s
Beneficial Interest shall pass as personal property to the Beneficiary’s legal representative and
such death shall in no way terminate or affect the validity of this Agreement. A Beneficiary shall
have no title to, right to, possession of, management of, or control of, the Trust Assets except as
expressly provided herein. No widower, widow, heir or devisee of any person who may be a
Beneficiary shall have any right of dower, homestead, or inheritance, or of partition, or of any
other right, statutory or otherwise, in any property forming a part of the Trust Assets but the
whole title to all the Trust Assets shall be vested in the Trustees and the sole interest of the
Beneficiaries shall be the rights and benefits given to such Persons under this Agreement.

3.3 Limitations on Transfer of Interests of Beneficiaries.

(a) THE BENEFICIAL INTEREST OF A BENEFICIARY MAY NOT BE TRANSFERRED; PROVIDED THAT THE
BENEFICIAL INTERESTS SHALL BE ASSIGNABLE OR TRANSFERABLE BY WILL, INTESTATE SUCCESSION OR
OPERATION OF LAW.

(b) Except as may be otherwise required by law, the Beneficial Interests of the
Beneficiaries hereunder shall not be subject to attachment, execution, sequestration or any
order of a court, nor shall such interests be subject to the contracts, debts, obligations,
engagements or liabilities of any Beneficiary, but the interest of a Beneficiary shall be
paid by the Trustees to the Beneficiary free and clear of all assignments, attachments,
anticipations, levies, executions, decrees and sequestrations and shall become the property
of the Beneficiary only when actually received by such Beneficiary.

3.4 Trustees as Beneficiary. The Trustees, either individually or in a representative
or fiduciary capacity, may be a Beneficiary to the same extent as if it were not the Trustees
hereunder and shall have all rights of a Beneficiary, including, without limitation, the right to
vote and to receive distributions, to the same extent as if they were not the Trustees hereunder.

ARTICLE IV

DURATION AND TERMINATION OF THE TRUST

4.1 Duration. The existence of the Trust shall terminate upon the earliest of (1) the
distribution of all the Trust Assets as provided in Section 5.7, or (2) the expiration of a period
of three years from the Transfer Date. Notwithstanding the foregoing, the Trustee may continue the
existence of the Trust beyond the three-year term if the Trustees reasonably determine that an
extension is necessary to fulfill the purposes of the trust; provided that the Trustees have
requested and obtained additional no-action assurance from the Division of Corporation Finance of
the Securities and Exchange Commission prior to such extension.

4.2 Other Obligations of Trustees upon Termination. Upon termination of the Trust,
the Trustees shall provide for the retention of the books, records, lists of holders of Units, and
files which shall have been delivered to or created by the Trustees. At the Trustees’ discretion,
all of such records and documents may be destroyed at any time after seven years from the
distribution of all the Trust Assets. Except as otherwise specifically provided herein, upon the
distribution of all the Trust Assets, the Trustees shall have no further duties or obligations
hereunder; provided, that the Trustees shall execute and deliver such other instruments and
agreements as shall be reasonably necessary to effect the termination of the Trust.

ARTICLE V

ADMINISTRATION OF TRUST ASSETS

5.1 Sale of Trust Assets. Subject to the terms and conditions of this Agreement, the
Trustees may, at such times as the Trustees deem appropriate, collect, liquidate, reduce to cash,
transfer, assign, or otherwise dispose of all or any part of the Trust Assets as it deems
appropriate at public auction or at private sale for cash, securities or other property, or upon
credit (either secured or unsecured as the Trustee shall determine). The Trustees shall make
continuing efforts to dispose of the Trust’s assets, make timely distributions and not unduly
prolong the duration of the Trust.

5.2 Efforts to Resolve Claims and Liabilities. Subject to the terms and conditions of
this Agreement, the Trustees shall make appropriate efforts to resolve any contingent or
unliquidated claims and outstanding contingent Liabilities for which the Trust may be responsible,
dispose of the Trust Assets, make timely distributions and not unduly prolong the duration of the
Trust.

5.3 Continued Collection of Trust Assets. All property that is determined to be a
part of the Trust Assets shall continue to be collected by the Trustees and held as a part of the
Trust. The Trustees shall hold the Trust Assets without being obligated to provide for or pay any
interest thereon to any Beneficiary, except to the extent of such Beneficiary’s share of interest
actually earned by the Trust after payment of the Trust’s liabilities and expenses as provided in
Section 5.5.

5.4 Restriction on Trust Assets. The Trustees shall cause to be distributed any
assets prohibited by Revenue Procedure 82-58, 1982-2 C.B. 847 (as amplified by Revenue Procedure
91-15, 1991-1 C.B. 484), as the same may be further amended, supplemented, or modified, including,
but not limited to, any listed stocks or securities, any readily-marketable assets, any operating
assets of a going business, any unlisted stock of a single issuer that represents 80% or more of
the stock of such issuer, or any general or limited partnership interest, except that the Trust may
receive and hold for disposition, the ownership interests identified in Schedule B hereto. The
Trustees shall not retain cash in excess of a reasonable amount to meet expenses, charges and
obligations of the Trust, the Trust Assets and all Liabilities.

5.5 Payment of Expenses and Liabilities. The Trustees shall pay from the Trust Assets
all expenses, charges, and obligations of the Trust and of the Trust Assets and all Liabilities and
obligations which the Trustees specifically assume and agree to pay pursuant to this Agreement and
such transferee liabilities which the Trustees may be obligated to pay as transferee of the Trust
Assets, including, but not limited to, interest, penalties, taxes, assessments, and public charges
of any kind or nature and the costs, charges, and expenses connected with or growing out of the
execution or administration of the Trust and such other payments and disbursements as are provided
in this Agreement or which may be determined to be a proper charge against the Trust Assets by the
Trustees.

5.6 Interim Distributions. At such times as may be determined in its sole discretion,
the Trustees shall distribute, or cause to be distributed to the Beneficiaries, in proportion to
the number of Units held by each Beneficiary on the record date for such distribution as determined
by the Trustees in their sole discretion, such cash or other property comprising a portion of the
Trust Assets as the Trustees may in their sole discretion determine may be distributed; provided,
however, that the Trustees shall distribute, or cause to be distributed, at least annually to the
Beneficiaries all cash proceeds from the sale of the Trust Assets in excess of a reasonable amount
(as determined by the Trustees) to satisfy the Liabilities and expenses described in Section 5.5.

5.7 Final Distribution. If the Trustees determine that the Liabilities and all other
claims, expenses, charges, and obligations of the Trust have been paid or discharged, the Trustees
shall, as expeditiously as is consistent with the conservation and protection of the Trust Assets,
distribute the remaining Trust Assets, if any, to the Beneficiaries in proportion to the number of
Units held by each Beneficiary.

5.8 Reports to Beneficiaries and Others.

(a) As soon as practicable after the Transfer Date, the Trustees will mail to each
Beneficiary a notice indicating how many Units such person beneficially owns and the
Trustees’ addresses and other contact information. As soon as practicable after the end of
each tax year and after termination of the Trust, but in any event within 90 days after
each such event, the Trustees shall submit a written report and account to the
Beneficiaries showing (i) the assets and liabilities of the Trust at the end of such
taxable year or upon termination and the receipts and disbursements of the Trustees for
such taxable year or period, prepared in accordance with generally accepted accounting
principles, (ii) any changes in the Trust Assets and Liabilities that they have not
previously reported, (iii) statements of net assets and changes in net assets for such
taxable year and (iv) any action taken by the Trustees in the performance of their duties
under this Agreement that it has not previously reported, and which, in its opinion,
materially affects the Trust Assets or Liabilities.

(b) The tax year of the Trust shall end on December 31 of each year.

(c) During the course of a tax year, whenever a material event relating to the Trust’s
Assets occurs, the Trustees shall, within a reasonable period of time after such
occurrence, prepare and mail to the Beneficiaries an interim report describing such event.
The occurrence of a material event need not be reported in an interim report if an annual
report pursuant to Section 5.8(a) will be issued at approximately the same time that such
interim report would be issued and such annual report describes the material event as it
would be discussed in an interim report. The occurrence of a material event will be
determined solely by the Trustees or as may be required by the rules and regulations
promulgated by the Securities and Exchange Commission.

(d) The Trustees’ reports pursuant to this Section shall be in accordance with
Maryland law.

5.9 Federal Income Tax Information. As soon as practicable after the close of each
tax year, the Trustees shall mail to each Person who was a Beneficiary during such year, a
statement showing, on a per Unit basis, the information necessary to enable a Beneficiary to
determine its taxable income (if any) from the Trust as determined for federal income tax purposes.
In addition, after receipt of a request in good faith, the Trustees shall furnish to any Person
who has been a Beneficiary at any time during the preceding year, at the expense of such Person and
at no cost to the Trust, a statement containing such further tax information as is reasonably
requested by such Person.

5.10 Books and Records. The Trustees shall maintain in respect of the Trust and the
holders of Units books and records relating to the Trust Assets, income and liabilities of the
Trust in such detail and for such period of time as may be necessary to enable it to make full and
proper accounting in respect thereof in accordance with this Article V and to comply with
applicable law. Such books and records shall be maintained on a basis or bases of accounting
necessary to facilitate compliance with the tax reporting requirements of the Trust and the
reporting obligations of the Trustees under Section 5.2. Except as provided in Section 5.8,
nothing in this Agreement requires the Trustees to file any accounting or seek approval of any
court with respect to the administration of the Trust or as a condition for managing any payment or
distribution out of the Trust Assets. Beneficiaries shall have the right upon 30 days’ prior
written notice delivered to the Trustees to inspect during normal business hours such books and
records (including financial statements); provided that, if so requested, such Beneficiaries shall
have entered into a confidentiality agreement satisfactory in form and substance to the Trustees.

5.11 Appointment of Agents, etc.

(a) The Trustees shall be responsible for the general policies of the Trust and for
the general supervision of the activities of the Trust conducted by all agents, advisors or
managers of the Trust. The Trustees shall have the power to appoint or contract with any
Person or Persons as the Trustees may deem necessary or proper for the transaction of all
or any portion of the activities of the Trust.

(b) The Trustees shall have the power to determine the terms and compensation of any
Person with whom it may contract pursuant to Section 5.11(a), subject to the provisions of
Section 5.12.

(c) The Trustees shall not be required to administer the Trust as their sole and
exclusive function and the Trustees may have other business interests and may engage in
other activities similar or in addition to those relating to the Trust, including the
rendering of advice or services of any kind to investors or any other Persons and the
management of other investments, subject to the Trustees’ obligations under this Agreement
and applicable law.

5.12 Fiduciary Duty.

(a) To the extent that, at law or in equity, the Trustees have duties (including
fiduciary duties) and liabilities relating thereto to the Trust, the Beneficiaries or to
any other Person, the Trustees acting under this Agreement shall not be liable to the
Trust, the Beneficiaries or to any other Person for its good faith reliance on the
provisions of this Agreement. The provisions of this Agreement, to the extent that they
restrict the duties and liabilities of the Trustees otherwise existing at law or in equity
are agreed by the parties hereto to replace such other duties and liabilities of the
Trustees.

(b) Unless otherwise expressly provided herein:

(i) whenever a conflict of interest exists or arises between the Trustees or
any of their Affiliates, on the one hand, and the Trust or any Beneficiaries or any
other Person, on the other hand; or

(ii) whenever this Agreement or any other agreement contemplated herein or
therein provides that the Trustees shall act in a manner that is, or provides terms
that are, fair and reasonable to the Trust, any Beneficiaries or any other Person,
the Trustees shall resolve such conflict of interest, take such action or provide
such terms, considering in each case the relative interest of each party (including
its own interest) to such conflict, agreement, transaction or situation and the
benefits and burdens relating to such interests, any customary or accepted industry
practices, and any applicable generally accepted accounting practices or
principles. In the absence of bad faith by the Trustees, the resolution, action or
terms so made, taken or provided by the Trustees shall not constitute a breach of
this Agreement or any other agreement contemplated herein or of any duty or
obligation of the Trustees at law or in equity or otherwise.

(c) Notwithstanding any other provision of this Agreement or otherwise applicable law,
whenever in this Agreement the Trustees are permitted or required to make a decision:

(i) in its “discretion” or under a grant of similar authority, the Trustees
shall be entitled to consider such interests and factors as it desires, including
its own interests, and, to the fullest extent permitted by applicable law, shall
have no duty or obligation to give any consideration to any interest of or factors
affecting the Trust, the Beneficiaries or any other Person; or

(ii) in its “good faith” or under another express standard, the Trustees shall
act under such express standard and shall not be subject to any other or different
standard.

(d) The Trustees and any Affiliate of the Trustees may engage in or possess an
interest in other profit-seeking or business ventures of any nature or description,
independently or with others, whether or not such ventures are competitive with the Trust
and the doctrine of corporate opportunity, or any analogous doctrine, shall not apply to
the Trustees. No Trustee who acquires knowledge of a potential transaction, agreement,
arrangement or other matter that may be an opportunity for the Trust shall have any duty to
communicate or offer such opportunity to the Trust, and such Trustee shall not be liable to
the Trust or to the Beneficiaries for breach of any fiduciary or other duty by reason of
the fact that such Trustee pursues or acquires for, or directs such opportunity to another
Person or does not communicate such opportunity or information to the Trust. Neither the
Trust nor any Beneficiary shall have any rights or obligations by virtue of this Agreement
or the trust relationship created hereby in or to such independent ventures or the income
or profits or losses derived therefrom, and the pursuit of such ventures, even if
competitive with the activities of the Trust, shall not be deemed wrongful or improper.
Any Trustee may engage or be interested in any financial or other transaction with the
Beneficiaries or any Affiliate of the Trust or the Beneficiaries, or may act as depositary
for, trustee or agent for, or act on any committee or body of holders of, securities or
other obligations of the Trust or the Beneficiaries or their Affiliates.

ARTICLE VI

POWERS OF AND LIMITATIONS ON THE TRUSTEES

6.1 Limitations on Trustees. The Trustees shall not at any time, on behalf of the
Trust or Beneficiaries, enter into or engage in any trade or business except as necessary for the
orderly liquidation of the Trust Assets. The Trustees shall be restricted to the holding,
collection and sale of the Trust Assets and the payment and distribution thereof for the purposes
set forth in this Agreement and to the conservation and protection of the Trust Assets and the
administration thereof in accordance with the provisions of this Agreement. In no event shall the
Trustees take any action which would jeopardize the status of the Trust as a “liquidating trust”
for federal, state or local income tax purposes within the meaning of Treasury Regulation Section
301.7701-4(d) and any analogous provision of state or local law. The Trustees shall not invest any
of the cash held as Trust Assets, except that the Trustees may invest in (i) direct obligations of
the United States of America or obligations of any agency or instrumentality thereof which mature
not later than one year from the date of acquisition thereof, (ii) money market deposit accounts,
checking accounts, savings accounts, or certificates of deposit, or other time deposit accounts
which mature not later than one year from the date of acquisition thereof which are issued by a
commercial bank or savings institution organized under the laws of the United States of America or
any state thereof, or (iii) other temporary investments not inconsistent with the Trust’s status as
a liquidating trust for tax purposes. Neither the Trustees nor any affiliate of the Trustees shall
take any action to facilitate or encourage trading in the Beneficial Interests or in any instrument
tied to the value of the Beneficial Interests such as due bill trading.

6.2 Specific Powers of Trustees. Subject to the provisions of the terms and
conditions of this Agreement, the Trustees shall have the following specific powers in addition to
any powers conferred upon it by any other Section or provision of this Agreement or any laws of the
State of Maryland; provided that the enumeration of the following powers shall not be considered in
any way to limit or control the power of the Trustees to act as specifically authorized by any
other Section or provision of this Agreement and to act in such a manner as the Trustees may deem
necessary or appropriate to conserve and protect the Trust Assets or to confer on the Beneficiaries
the benefits intended to be conferred upon them by this Agreement:

(a) to determine the nature and amount of the consideration to be received with
respect to the sale or other disposition of, or the grant of interest in, the Trust Assets;

(b) to collect, liquidate or otherwise convert into cash, or such other property as it
deems appropriate, all property, assets and rights in the Trust Assets, and to pay,
discharge, and satisfy all other claims, expenses, charges, Liabilities and obligations
existing with respect to the Trust Assets, the Trust or the Trustees;

(c) to elect, appoint, engage or retain any Persons as agents, representatives or
independent contractors (including without limitation real estate advisors, investment
advisors, accountants, transfer agents, attorneys-at-law, managers, appraisers, brokers, or
otherwise) in one or more capacities, and to pay reasonable compensation from the Trust
Assets for services in as many capacities as such Person may be so elected, appointed,
engaged or retained (provided that any such agreements or arrangements with a person or
entity affiliated with the Trustees shall be on terms no less favorable to the Trust than
those available to the Trust in similar agreements or arrangements with unaffiliated third
parties, and such agreements or arrangements shall be terminable, without penalty, on 60
days prior written notice by the Trust), to prescribe the titles, powers and duties, terms
of service and other terms and conditions of the election, appointment, engagement or
retention of such Persons and, except as prohibited by law, to delegate any of the powers
and duties of the Trustees to agents, representatives, independent contractors or other
Persons, including, without limitation, the retention of Triple Net Properties, LLC and its
affiliates to provide various services to the Trust consistent with the types of services
and compensation terms previously applicable to the Company prior to the formation of the
Trust;

(d) to retain and set aside such funds out of the Trust Assets as the Trustees shall
deem necessary or expedient to pay, or provide for the payment of (i) unpaid claims,
expenses, charges, Liabilities and obligations of the Trust, the Company or any Subsidiary;
and (ii) the expenses of administering the Trust Assets;

(e) to do and perform any and all acts necessary or appropriate for the conservation
and protection of the Trust Assets, including acts or things necessary or appropriate to
maintain the Trust Assets held by the Trustees pending sale or disposition thereof or
distribution thereof to the Beneficiaries;

(f) to institute or defend actions or judgments for declaratory relief or other
actions or judgments and to take such other action, in the name of the Trust or the Company
or as otherwise required, as the Trustees may deem necessary or desirable to enforce any
instruments, contracts, agreements, causes of action, or rights relating to or forming a
part of the Trust Assets;

(g) to determine conclusively from time to time the value of and to revalue the
securities and other property of the Trust, in accordance with independent appraisals or
other information as it deems necessary or appropriate;

(h) to cancel, terminate, or amend any instruments, contracts, agreements,
obligations, or causes of action relating to or forming a part of the Trust Assets, and to
execute new instruments, contracts, agreements, obligations or causes of action
notwithstanding that the terms of any such instruments, contracts, agreements, obligations,
or causes of action may extend beyond the terms of the Trust;

(i) in the event any of the property which is or may become a part of the Trust Assets
is situated in any state or other jurisdiction in which the Trustees are not qualified to
act as Trustees, to nominate and appoint an individual or corporate trustee qualified to
act in such state or other jurisdiction in connection with the property situated in that
state or other jurisdiction as a trustee of such property and require from such trustee
such security, if any, as may be designated by the Trustees, which, in the sole discretion
of the Trustees may be paid out of the Trust Assets. The trustee so appointed shall have
all the rights, powers, privileges and duties and shall be subject to the conditions and
limitations of the Trust, except as limited by the Trustees and except where the same may
be modified by the laws of such state or other jurisdiction (in which case, the laws of the
state or other jurisdiction in which such trustee is acting shall prevail to the extent
necessary). Such trustee shall be answerable to the Trustees herein appointed for all
monies, assets and other property which may be received by it in connection with the
administration of such property. The Trustees hereunder may remove such trustee, with or
without cause, and appoint a successor trustee at any time by the execution by the Trustees
of a written instrument declaring such trustee removed from office, and specifying the
effective date of removal;

(j) to cause any investments of any part of the Trust Assets to be registered and held
in its name or in the names of a nominee or nominees without increase or decrease of
liability with respect thereto;

(k) to terminate and dissolve any entities owned by the Trust; and

(1) to perform any act authorized, permitted, or required under any instrument,
contract, agreement, right, obligation, or cause of action relating to or forming a part of
the Trust Assets whether in the nature of an approval, consent, demand, or notice
thereunder or otherwise, unless such act would require the consent of the Beneficiaries in
accordance with the express provisions of this Agreement.

ARTICLE VII

CONCERNING THE TRUSTEES, BENEFICIARIES AND AGENTS

7.1 Generally. The Trustees accept and undertake to discharge the Trust, upon the
terms and conditions hereof, on behalf of the Beneficiaries. The Trustees shall exercise such of
the rights and powers vested in it by this Agreement in good faith and in the best interests of the
Beneficiaries. The Trustees shall not be personally liable for any act or omission hereunder
except as determined by a final order of a court of competent jurisdiction for its own grossly
negligent action, its own grossly negligent failure to act, or its own fraud or willful misconduct,
in each case, as determined by a final order of a court of competent jurisdiction from which no
appeal can or is taken, except that:

(a) no successor Trustee shall be responsible for the acts or omissions of a Trustee
in office prior to the date on which it becomes a Trustee;

(b) the Trustees shall not be liable to the Beneficiaries for the acts or omissions of
an agent, advisor or manager of the Trust appointed by the Trustees hereunder, except where
the Trustees specifically direct the act of such Person, delegates the authority to such
Person to act where such Trustee was under a duty not to delegate, does not use reasonable
prudence in the selection or retention of such Person, does not periodically review such
person’s overall performance and compliance with the terms of such delegation; conceals the
act or omission of such Person; or neglects to take reasonable steps to redress any wrong
committed by such Person when such Trustee is aware of such Person’s act or omission;
provided, however, that this subsection (b) shall not apply to acts or omissions of any
Affiliate of Trustees, or any of their respective employees;

(c) the Trustees shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this Agreement, and no implied covenants or
obligations shall be read into this Agreement against the Trustees;

(d) in the absence of bad faith on the part of the Trustees, the Trustees may
conclusively rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to the Trustees and
conforming to the requirements of this Agreement; but in the case of any such certificates
or opinions which are specifically required to be furnished to the Trustees by any
provision hereof, the Trustees shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this Agreement;

(e) the Trustees shall not be liable for any reasonable error of judgment made in good
faith; and

(f) the Trustees shall not be liable with respect to any action taken or omitted to be
taken by the Trustees in good faith in accordance with the terms and conditions of this
agreement and at the direction of Beneficiaries having aggregate Units of at least
one-third of the total Units held by all Beneficiaries relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustees or exercising
any right or power conferred upon the Trustees under this Agreement.

7.2 Reliance by Trustees. Except as otherwise provided in Section 7.1:

(a) The Trustees may consult with legal counsel, auditors or other experts to be
selected by it and the advice or opinion of such counsel, auditors, or other experts shall
be full and complete personal protection to the Trustees and agents of the Trust in respect
of any action taken or suffered by the Trustees in good faith and in the reliance on, or in
accordance with, such advice or opinion.

(b) Persons dealing with the Trustees shall look only to the Trust Assets to satisfy
any liability incurred by the Trustees to such Person in carrying out the terms of the
Trust, and the Trustees shall have no personal or individual obligation to satisfy any such
liability.

(c) As far as reasonably practicable, the Trustees shall cause any written instrument
creating an obligation of the Trust to include a reference to this Agreement and to provide
that neither the Beneficiaries, the Trustees nor their agents shall be liable thereunder,
and that the other parties to such instrument shall look solely to the Trust Assets for the
payment of any claim thereunder or the performance thereof; provided that the omission of
such provision from any such instrument shall not render the Beneficiaries, the Trustees or
their agents liable, nor shall the Trustees be liable to anyone for such omission.

7.3 Limitation on Liability to Third Persons. No Beneficiary shall be subject
to any personal liability whatsoever, in tort, contract, or otherwise, to any Person in
connection with the Trust Assets or the affairs of the Trust, and, to the fullest extent
permitted by law, no Trustees or agent of the Trust shall be subject to any personal
liability whatsoever in tort, contract, or otherwise, to any Beneficiary or any other
Person in connection with the Trust Assets or the affairs of the Trust, except to the
extent determined by a court of competent jurisdiction from which no appeal can be or is
taken, to have resulted from the gross negligence, fraud or willful misconduct knowingly
and intentionally committed in bad faith by such Trustees or agent of the Trust. All such
other Persons shall look solely to the Trust Assets for satisfaction of claims of any
nature arising in connection with the affairs of the Trust. The Trustees shall, at all
times, at the expense of the Trust, maintain insurance for the protection of the Trust
Assets, its Beneficiaries, the Trustees and agents in such amount as the Trustees shall
deem adequate to cover all foreseeable liability to the extent available at reasonable
rates.

7.4 Recitals. Any written instrument creating an obligation of the Trust
shall be conclusively taken to have been executed or done by a Trustee or agent of the
Trust only in its capacity as Trustee under this Agreement, or in its capacity as an agent
of the Trust.

7.5 Indemnification. The Trustees and each Person appointed by the Trustees
pursuant to Section 5.11, and the directors, officers, employees and agents of each such
Person (each an “Indemnified Person” and collectively the “Indemnified Persons”), shall, to
the fullest extent permitted by law, be indemnified out of the Trust Assets against all
liabilities and expenses, including amounts paid in satisfaction of judgments, in
compromise or as fines and penalties, and counsel fees, reasonably incurred by the
Indemnified Persons in connection with the defense or disposition of any action, suit or
other proceeding by the Trust or any other Person, whether civil or criminal, in which the
Indemnified Person may be involved or with which the Indemnified Person may be threatened:
(i) in the case of the Trustees or a Person appointed by the Trustees pursuant to Section
5.11, while in office or thereafter, by reason of his being or having been such a Trustee
or agent including, without limitation, in connection with or arising out of any action,
suit or other proceeding based on any alleged breach of duty, neglect, error, misstatement,
misleading statement, omission or act of the Trustees or any such Person in such capacity:
and (iii) in the case of any director, officer or agent of any such Person, by reason of
any such Person exercising or failing to exercise any right or power hereunder; provided
that the Indemnified Person shall not be entitled to such indemnification with respect to
any matter as to which the Indemnified Person shall have been adjudicated by a final order
of a court of competent jurisdiction from which no appeal can be or is taken, to have acted
with gross negligence, fraud or willful misconduct knowingly and intentionally committed in
bad faith. The rights accruing to any Indemnified Person under these provisions shall not
exclude any other right to which the Indemnified Person may be lawfully entitled; provided
that no Indemnified Person may satisfy any right of indemnity or reimbursement granted
herein, or to which the Indemnified Person may be otherwise entitled, except out of the
Trust Assets, and no Beneficiary shall be personally liable to any person with respect to
any claim for indemnity or reimbursement or otherwise. The Trustees may make advance
payments in connection with indemnification under this Section 7.5, provided that the
Indemnified Person shall have given a written undertaking to repay any amount advanced to
the Indemnified Person and to reimburse the Trust in the event that it is subsequently
determined that the Indemnified Person is not entitled to such indemnification. The
Trustees may purchase such insurance as it believes, in the exercise of its discretion,
adequately insures that each Indemnified Person shall be indemnified against any such loss,
liability, or damage pursuant to this Section 7.5. Nothing contained herein shall restrict
the right of the Trustees to indemnify or reimburse such Indemnified Person in any proper
case, even though not specifically provided for herein, nor shall anything contained herein
restrict the right of any such Indemnified Person to contribution under applicable law.

ARTICLE VIII

PROTECTION OF PERSONS DEALING WITH THE TRUSTEES

8.1 Action by Trustees. At any time there is more than one Trustee, all action with
respect to the disposition and distribution of the Trust Assets required or permitted to be taken
by the Trustee, in its capacity as Trustee, shall be taken by approval, consent, vote or resolution
authorized by at least a majority of the Trustees.

8.2 Reliance on Statements by Trustees. Any Person dealing with the Trustees shall be
fully protected in relying upon a certificate signed by the Trustee, stating that it has authority
take any action under the Trust. Any Person dealing with the Trustees shall be fully protected in
relying upon the Trustees’ certificate setting forth the facts concerning the action taken by the
Trustees pursuant to this Agreement, including the aggregate number of Units held by the
Beneficiaries causing such action to be taken.

ARTICLE IX

COMPENSATION OF TRUSTEES

9.1 Amount of Compensation. In lieu of commissions or other compensation fixed by law
for the Trustees, the Trustees shall receive as compensation for services as Trustees hereunder the
amounts set forth in Schedule A attached hereto, or as may subsequently be approved by
Beneficiaries having a majority of the total Units present in person or by proxy at any meeting
validly called for such purpose pursuant to Section 12 hereof.

9.2 Expenses. The Trustees shall be reimbursed from the Trust Assets for all expenses
reasonably incurred, and appropriately documented, by the Trustees in the performance of the
Trustees’ duties in accordance with this Agreement.

ARTICLE X

TRUSTEES AND SUCCESSOR TRUSTEES

10.1 Number and Qualification of Trustees.

(a) Subject to the provisions of Section 10.3 relating to the period pending the
appointment of a successor Trustee, there shall be five Trustees of this Trust, which shall
be citizens and residents of or a corporation or other entity which is incorporated or
formed under the laws of a state of the United States and, if a corporation, it shall be
authorized to act as a corporate fiduciary under the laws of the State of Maryland or such
other jurisdiction as shall be determined by the Trustee in its sole discretion. The
number of Trustees may be increased or decreased from time to time by the Trustees.

(b) If a corporate Trustee shall ever change its name, or shall reorganize or
reincorporate, or shall merge with or into or consolidate with any other bank or trust
company, such corporate trustee shall be deemed to be a continuing entity and shall
continue to act as a trustee hereunder with the same liabilities, duties, powers, titles,
discretions, and privileges as are herein specified for a Trustee.

10.2 Resignation and Removal. Any Trustee may resign and be discharged from the Trust
hereby created by giving written notice to the Beneficiaries at their respective addresses as they
appear on the records of the Trustees. Such resignation shall become effective upon the
appointment of such Trustee’s successor, and such successor’s acceptance of such appointment,
whichever is earlier. Any Trustee may be removed at any time, with cause, by Beneficiaries having
aggregate Units of at least a majority of the total Units held by all Beneficiaries. Any Trustee
may be removed at any time, without cause, by Beneficiaries having aggregate Units of at least
two-thirds of the total Units held by all Beneficiaries.

10.3 Appointment of Successor. Should at any time a Trustee resign or be removed,
die, become mentally incompetent or incapable of action (as determined by the Beneficiaries holding
Units representing an aggregate of at least a majority of the total Beneficial Interests in the
Trust), or be adjudged bankrupt or insolvent, unless any remaining Trustees shall decrease the
number of Trustees of the Trust pursuant to Section 10.1 hereof, or shall the number of Trustees be
increased in accordance with Section 10.3 hereof, a vacancy shall be deemed to exist and a
successor shall be appointed by any remaining Trustees. If (i) such a vacancy is not filled by any
remaining Trustees within ninety (90) days, and the remaining Trustees, if any, have notified the
Beneficiaries of their inability to fill such vacancy or (ii) there is no remaining Trustee then,
the Beneficiaries may, pursuant to Article 12 hereof, call a meeting to appoint a successor Trustee
by Beneficiaries holding Units representing an aggregate of at least a majority of the total
Beneficial Interests in the Trust present at the meeting, in person or by proxy. Pending the
appointment of a successor Trustee, the remaining Trustee or Trustees then serving may take any
action in the manner set forth in Section 8.1.

10.4 Acceptance of Appointment by Successor Trustee. Any successor Trustee appointed
hereunder shall execute an instrument accepting such appointment hereunder and shall file one
counterpart with the books and records of the Trust and, in case of a resignation, deliver one
counterpart to the retiring Trustee. Thereupon such successor Trustee shall, without any further
act, become vested with all the estates, properties, rights, powers, trusts, and duties of its
predecessor in the Trust hereunder with like effect as if originally named therein; but the former
Trustee shall nevertheless, when requested in writing by the successor Trustee, execute and deliver
an instrument or instruments conveying and transferring to such successor Trustee upon the trust
herein expressed, all the estates, properties, rights, powers, and trusts of such retiring Trustee,
and it shall duly assign, transfer, and deliver to such successor Trustee all property and money
held by such Trustee hereunder.

10.5 Bonds. Unless required by the Board prior to the Transfer Date, or unless a bond
is required by law, no bond shall be required of any original Trustees hereunder. Unless a bond is
required by law and such requirement cannot be waived by or with approval of the Beneficiaries
holding aggregate Units of at least a majority of the total Units held by all Beneficiaries, no
bond shall be required of any successor Trustee hereunder. If a bond is required by law, no surety
or security with respect to such bond shall be required unless required by law and such requirement
cannot be waived by or with approval of the Beneficiaries or unless required by the Board. If a
bond is required by the Board or by law, the Board or the Trustees, as the case may be, shall
determine whether, and to what extent, a surety or security with respect to such bond shall be
required. The cost of any such bond shall be borne by the Trust.

ARTICLE XI

CONCERNING THE BENEFICIARIES

11.1 Evidence of Action by Beneficiaries. Whenever in this Agreement it is provided
that the Beneficiaries may take any action (including the making of any demand or request, the
giving of any notice, consent, or waiver, the removal of a Trustee, the appointment of a successor
Trustee, or the taking of any other action), the fact that at the time of taking any such action
such Beneficiaries have joined therein may be evidenced: (i) by any instrument or any number of
instruments of similar tenor executed by the Beneficiaries in person or by agent or attorney
appointed in writing; or (ii) by the record of the Beneficiaries voting in favor thereof at any
meeting of Beneficiaries duly called and held in accordance with the provisions of Article XII.

11.2 Limitation on Suits by Beneficiaries. No Beneficiary shall have any right by
virtue of any provision of this Agreement to institute any action or proceeding at law or in equity
against any party other than the Trustees upon or under or with respect to the Trust Assets or the
agreements relating to or forming part of the Trust Assets, and the Beneficiaries (by their
acceptance of any distribution made to them pursuant to this Agreement) waive any such right.

11.3 Requirement of Undertaking. The Trustees may request any court to require, and
any court may in its discretion require, in any suit for the enforcement of any right or remedy
under this Agreement, or in any suit against the Trustees for any action taken or omitted to be
taken by them as Trustees, the filing by any party litigant in such suit of an undertaking to pay
the costs of such suit, and such court may in its discretion assess reasonable costs, including
reasonable attorneys’ fees, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant; provided that the
provisions of this Section 11.3 shall not apply to any suit by the Trustees.

ARTICLE XII

MEETING OF BENEFICIARIES

12.1 Purpose of Meetings. A meeting of the Beneficiaries may be called at any time
and from time to time pursuant to the provisions of this Article for the purposes of taking any
action which the terms of this Agreement permit Beneficiaries to take either acting alone or with
the Trustees.

12.2 Meeting Called by Trustees. The Trustees may at any time call a meeting of the
Beneficiaries to be held at such time and at such place as the Trustees shall determine. Written
notice of every meeting of the Beneficiaries shall be given by the Trustees (except as provided in
Section 12.3), which written notice shall set forth the time and place of such meeting and in
general terms the action proposed to be taken at such meeting, and shall be mailed not more than 60
nor less than 10 days before such meeting is to be held to all of the Beneficiaries of record not
more than 60 days before the date of such meeting. The notice shall be directed to the
Beneficiaries at their respective addresses as they appear in the records of the Trust.

12.3 Meeting Called on Request of Beneficiaries. Within 30 days after written request
to the Trustees by Beneficiaries holding an aggregate of at least 25% of the total Units held by
all Beneficiaries to call a meeting of all Beneficiaries, which written request shall specify in
reasonable detail the action proposed to be taken, the Trustees shall proceed under the provisions
of Section 12.2 to call a meeting of the Beneficiaries, and if the Trustees fail to call such
meeting within such 30 day period then such meeting may be called by such Beneficiaries, or their
designated representatives, requesting such meeting.

12.4 Persons Entitled to Vote at Meeting of Beneficiaries. Each Beneficiary shall be
entitled to vote at a meeting of the Beneficiaries either in person or by his proxy duly authorized
in writing. The signature of the Beneficiary on such written authorization need not be witnessed
or notarized. Each Beneficiary shall be entitled to a number of votes equal to the number of Units
held by such Beneficiary as of the applicable record date.

12.5 Quorum. Except as otherwise required by this Agreement or law, Beneficiaries
holding at least one-third of the total Units held by all Beneficiaries shall be necessary to
constitute a quorum at any meeting of Beneficiaries for the transaction of business. If less than
a quorum be present, Beneficiaries having aggregate Units of at least a majority of the total Units
held by all Beneficiaries represented at the meeting may adjourn such meeting with the same effect
and for all intents and purposes as though a quorum had been present. Except to the extent a
different percentage is specified in this Agreement for a particular matter or is required by law,
when a quorum is present, the approval of Beneficiaries having aggregate Units of at least a
majority of the total Units present or represented by proxy at such meeting shall be required for
taking action on any matter voted on by the Beneficiaries.

12.6 Adjournment of Meeting. Subject to Section 12.5, any meeting of Beneficiaries
may be adjourned from time to time and a meeting may be held at such adjourned time and place
without further notice.

12.7 Conduct of Meetings. The Trustees shall appoint the Chairman and the Secretary
of the meeting. The vote upon any resolution submitted to any meeting of Beneficiaries shall be by
written ballot. An Inspector of Votes, appointed by the Chairman of the meeting, shall count all
votes cast at the meeting for or against any resolution and shall make and file with the Secretary
of the meeting their verified written report.

12.8 Record of Meeting. A record of the proceedings of each meeting of Beneficiaries
shall be prepared by the Secretary of the meeting. The record shall be signed and verified by the
Secretary of the meeting and shall be delivered to the Trustees to be preserved by them. Any
record so signed and verified shall be conclusive evidence of all of the matters therein stated.

ARTICLE XIII

AMENDMENTS

13.1 Consent of Beneficiaries. At the written direction or with the written consent
of Beneficiaries holding at least a majority of the total Units present, in person or by proxy, at
any meeting validly called for such purpose pursuant to Section 12 hereof, or such greater or
lesser percentage as shall be specified in this Agreement for the taking of an action by the
Beneficiaries under the affected provision of this Agreement, the Trustees shall promptly make and
execute a declaration amending this Agreement for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement or amendments
thereto; provided that no such amendment shall increase the potential liability of the Trustees
hereunder without the written consent of the Trustees; provided, further, that no such amendment
shall permit the Trustees to engage in any activity prohibited by Section 6.1 hereof or affect the
Beneficiaries’ rights to receive their pro rata shares of the Trust Assets at the time of any
distribution, and no such amendment shall jeopardize the status of the Trust as a “liquidating
trust” for federal, state, or local income tax purposes within the meaning of Treasury Regulation
Section 301.7701-4(d) and any analogous provision of state or local law or jeopardize the
Beneficiaries treatment as other than the owners of their respective shares of the Trust’s taxable
income pursuant to Section 671 through 679 of the Code and any analogous provision of state or
local law.

13.2 Notice and Effect of Amendment. Promptly after the execution by the Trustees of
any such declaration of amendment, the Trustees shall give notice of the substance of such
amendment to the Beneficiaries or, in lieu thereof, the Trustees may send a copy of the amendment
to each Beneficiary. Upon the execution of any such declaration of amendment by the Trustees, this
Agreement shall be deemed to be modified and amended in accordance therewith and the respective
rights, limitations of rights, obligations, duties, and immunities of the Trustees and the
Beneficiaries under this Agreement shall thereafter be determined, exercised and enforced hereunder
subject in all respects to such modification and amendments, and all the terms and conditions of
any such amendment shall thereby be deemed to be part of the terms and conditions of this Agreement
for any and all purposes.

ARTICLE XIV

MISCELLANEOUS PROVISIONS

14.1 Filing Documents. This Agreement shall be filed or recorded in such office or
offices as the Trustees may determine to be necessary or desirable. A copy of this Agreement and
all amendments thereof shall be maintained in the office of the Trustees and shall be available at
all times during regular business hours for inspection by any Beneficiary or his duly authorized
representative. The Trustees shall file or record any amendment of this Agreement in the same
places where the original Agreement is filed or recorded. The Trustees shall file or record any
instrument which relates to any change in the office of the Trustees in the same places where the
original Agreement is filed or recorded.

14.2 Intention of Parties to Establish Trust. This Agreement is not intended to
create, and shall not be interpreted as creating, a corporation, association, partnership, or joint
venture of any kind for purposes of federal income taxation or for any other purpose.

14.3 Beneficiaries Have No Rights or Privileges as Stockholders of the Company.
Except as expressly provided in this Agreement or under applicable law, the Beneficiaries (by their
vote with respect to the Plan and/or their acceptance of any distributions made to them pursuant to
this Agreement) shall have no rights or privileges attributable to their former status as
stockholders of the Company.

14.4 Laws as to Construction. This Agreement and the trust created hereby shall be
governed by and construed in accordance with the laws of the State of Maryland. The Trustees, the
Company and the Beneficiaries (by their acceptance of any distributions made to them pursuant to
this Agreement) consent and agree that this Agreement shall be governed by and construed in
accordance with such laws. The Trustees may amend this Agreement to provide for the creation of a
new trust governed by the laws of another jurisdiction to which the Retained Assets and Liabilities
shall be assigned.

14.5 Severability. In the event any provision of this Agreement or the application
thereof to any Person or circumstances shall be finally determined by a court of proper
jurisdiction to be invalid or unenforceable to any extent, the remainder of this Agreement, or the
application of such provision to persons or circumstances other than those as to which it is held
invalid or unenforceable, shall not be affected thereby, and each provision of this Agreement shall
be valid and enforced to the fullest extent permitted by law.

14.6 Notices. Any notice or other communication by the Trustees to any Beneficiary
shall be deemed to have been sufficiently given, for all purposes, if deposited, postage prepaid,
in the post office or letter box addressed to such Person at his address as shown in the records of
the Trust.

All notices and other communications hereunder shall be in writing and shall be deemed to have
been duly given if delivered personally or sent telecopier to the parties at the following
addresses or at such other addresses as shall be specified by the parties by like notice:

(a) If to the Trustees:

G REIT Liquidating Trust

1551 N. Tustin Avenue, Suite 200

Santa Ana, CA 92705

Attention: Trustees

Facsimile: (714) 667-0315

(b) If to the Company:

G REIT, Inc.

1551 N. Tustin Avenue, Suite 200

Santa Ana, CA 92705

Attention: Chief Executive Officer

Facsimile: (714) 667-0315

14.7 Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be an original, but such counterparts shall together constitute one and the same
instrument.

1

IN WITNESS WHEREOF, G REIT, Inc. has caused this Agreement to be executed by an authorized
officer, and the Trustees herein have executed this Agreement, effective this 22nd day
of January, 2008.

G REIT, INC.

By: /s/ Scott D. Peters

Name: Scott D. Peters

Title: Chief Executive Officer and President

TRUSTEES:

/s/ Gary Hunt

Name: Gary H. Hunt

Title: Trustee

/s/ W. Brand Inlow

Name: W. Brand Inlow

Title: Trustee

/s/ Edward Johnson

Name: Edward A. Johnson

Title: Trustee

/s/ D. Fleet Wallace

Name: D. Fleet Wallace

Title: Trustee

/s/ Gary T. Wescombe

Name: Gary T. Wescombe

Title: Trustee

2

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