Document:

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                                                                    EXHIBIT 10.1

                              EMPLOYMENT AGREEMENT

         This Employment Agreement (this "Agreement") by and between Grant
Prideco, Inc., a Delaware corporation (the "Company"), and Louis Raspino (the
"Executive"), is effective as of July 9, 2001.

                                   WITNESSETH:

         WHEREAS, the Board of Directors of the Company (the "Board") has
determined that it is in the best interests of the Company and its stockholders
to retain the Executive and to induce the employment of the Executive for the
long term benefit of the Company;

         WHEREAS, the Board does not contemplate the termination of the
Executive during the term hereof and the Board and the Executive expect that the
Executive will be retained for at least the three year period contemplated
herein; and

         WHEREAS, to accomplish these objectives, the Board has caused the
Company to enter into this Agreement.

         NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

         1. Employment.

         (a) The Company hereby agrees that the Company or an affiliated company
will continue the Executive in its employ, and the Executive hereby agrees to
remain in the employ of the Company or an affiliate subject to the terms and
conditions of this Agreement, during the Employment Period (as defined below).

         (b) The "Employment Period" shall mean the period commencing on the
date hereof and ending on the third anniversary of the date hereof.; provided,
however, that commencing on the date one year after the date hereof, and on each
annual anniversary of such date (such date and each annual anniversary thereof
shall be hereinafter referred to as the "Renewal Date"), unless previously
terminated, the Employment Period shall be automatically extended so as to
terminate three years after such Renewal Date, unless at least 60 days prior to
the Renewal Date the Company shall give notice to the Executive that the
Contract Period shall not be so extended.

         2. Terms of Employment.

                  (a) Position and Duties.

                           (i) During the Employment Period, (A) the Executive's
         position (including status, offices, titles and reporting requirements,
         authority, duties and responsibilities) shall be Vice President and
         Chief Financial Officer of the Company and such other executive
         positions as may be assigned to him and (B) the Executive's services
         shall be performed at any location within 50 miles from downtown,
         Houston, Texas.

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                           (ii) During the Employment Period, and excluding any
         periods of vacation and sick leave to which the Executive is entitled,
         the Executive agrees to devote reasonable attention and time during
         normal business hours to the business and affairs of the Company and,
         to the extent necessary to discharge the responsibilities assigned to
         the Executive hereunder, to use the Executive's reasonable best efforts
         to perform faithfully and efficiently such responsibilities. During the
         Employment Period it shall not be a violation of this Agreement for the
         Executive to (A) serve on corporate, civic or charitable boards or
         committees, (B) deliver lectures, fulfill speaking engagements or teach
         at educational institutions and (C) manage personal investments, so
         long as such activities do not significantly interfere with the
         performance of the Executive's responsibilities as an employee of the
         Company in accordance with this Agreement. It is expressly understood
         and agreed that to the extent that any such activities have been
         conducted by the Executive prior to the date hereof, the continued
         conduct of such activities (or the conduct of activities similar in
         nature and scope thereto) subsequent to the date hereof shall not
         thereafter be deemed to interfere with the performance of the
         Executive's responsibilities to the Company.

                  (b) Compensation.

                           (i) Base Salary. During the Employment Period, the
         Executive shall receive an annual base salary of $250,000 ("Annual Base
         Salary"), which shall be paid at a monthly rate. During the Employment
         Period, the Annual Base Salary shall be reviewed at least annually;
         provided, however, that a salary increase shall not necessarily be
         awarded as a result of such review. Any increase in Annual Base Salary
         may not serve to limit or reduce any other obligation to the Executive
         under this Agreement. Annual Base Salary shall not be reduced after any
         such increase. The term Annual Base Salary as utilized in this
         Agreement shall refer to Annual Base Salary as so increased.

                           (ii) Annual Bonus. The Executive shall be eligible
         for an annual bonus (the "Annual Bonus") for each fiscal year ending
         during the Employment Period (including a full bonus during 2001) on
         the same basis as other executive officers under the Company's
         executive officer annual incentive program. Each such Annual Bonus
         shall be paid no later than the end of the third month of the fiscal
         year next following the fiscal year for which the Annual Bonus is
         awarded or at such time as bonuses are paid generally to the employees
         of the Company, unless the Executive shall elect to defer the receipt
         of such Annual Bonus pursuant to a Company sponsored deferred
         compensation plan in effect.

                           (iii) Incentive, Savings and Retirement Plans. During
         the Employment Period, the Executive shall be entitled to participate
         in all incentive, savings and retirement plans, practices, policies and
         programs applicable generally to the Executive's peer executives of the
         Company and its affiliated companies, but in no event shall such plans,
         practices, policies and programs provide the Executive with incentive
         opportunities (measured with respect to both regular and special
         incentive opportunities, to the extent, if any, that such distinction
         is applicable), savings opportunities and retirement benefit
         opportunities, in each case, less favorable, in the aggregate, than the
         most favorable of those provided by the Company and its affiliated
         companies for the Executive under such plans,

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         practices, policies and programs as in effect on the date hereof. As
         used in this Agreement, the term "affiliated companies" shall include
         any company controlled by, controlling or under common control with the
         Company.

                           (iv) Welfare Benefit Plans. During the Employment
         Period, the Executive and/or the Executive's family, as the case may
         be, shall be eligible to participate in and shall receive all benefits
         under welfare benefit plans, practices, policies and programs provided
         by the Company and its affiliated companies (including, without
         limitation, medical, prescription, dental, disability, salary
         continuance, employee life, group life, accidental death and travel
         accident insurance plans and programs) to the extent applicable
         generally to the Executive's peer executives of the Company and its
         affiliated companies, but in no event shall such plans, practices,
         policies and programs provide the Executive with benefits that are less
         favorable, in the aggregate, than such plans, practices, policies and
         programs as may be in effect from time to time.

                           (v) Expenses. During the Employment Period, the
         Executive shall be entitled to receive prompt reimbursement for all
         reasonable expenses incurred by the Executive in accordance with the
         most favorable policies, practices and procedures of the Company and
         its affiliated companies as may be in effect from time to time.

                           (vi) Fringe Benefits. During the Employment Period,
         the Executive shall be entitled to fringe benefits (including, without
         limitation, financial planning services, payment of club dues, a car
         allowance or use of an automobile and payment of related expenses, as
         appropriate) in accordance with the most favorable plans, practices,
         programs and policies of the Company as may be in effect from time to
         time.

                           (vii) Vacation. During the Employment Period, the
         Executive shall be entitled to paid vacation in accordance with the
         most favorable plans, policies, programs and practices of the Company
         and its affiliated companies as may be in effect from time to time
         (provided a minimum of four weeks vacation per year is provided).

         3. Termination of Employment.

                  (a) Death or Disability. The Executive's employment shall
terminate automatically upon the Executive's death during the Employment Period.
If the Company determines in good faith that the Disability of the Executive has
occurred during the Employment Period (pursuant to the definition of Disability
set forth below), it may give to the Executive written notice in accordance with
Section 10(b) of this Agreement of its intention to terminate the Executive's
employment. In such event, the Executive's employment with the Company shall
terminate effective 30 days after receipt of such notice by the Executive (the
"Disability Effective Date"), provided that within the 30-day period after such
receipt, the Executive shall not have returned to full-time performance of the
Executive's duties. For purposes of this Agreement, "Disability" shall mean the
absence of the Executive from the Executive's duties with the Company on a
full-time basis for 180 calendar days as a result of incapacity due to mental or
physical illness

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that is determined to be total and permanent by a physician selected by the
Company or its insurers and acceptable to the Executive or the Executive's legal
representative.

                  (b) Cause. The Company may terminate the Executive's
employment during the Employment Period for Cause. For purposes of this
Agreement, "Cause" shall mean:

                           (i) the willful and continued failure of the
         Executive to perform substantially the Executive's duties with the
         Company or one of its affiliates (other than any such failure resulting
         from incapacity due to physical or mental illness), after a written
         demand for substantial performance is delivered to the Executive by the
         Board or the Chief Executive Officer of the Company that specifically
         identifies the manner in which the Board or Chief Executive Officer
         believes that the Executive has not substantially performed the
         Executive's duties, or

                           (ii) the willful engaging by the Executive in illegal
         conduct or gross misconduct that is materially and demonstrably
         injurious to the Company.

                  For purposes of this provision, no act, or failure to act, on
the part of the Executive shall be considered "willful" unless it is done, or
omitted to be done, by the Executive in bad faith or without reasonable belief
that the Executive's action or omission was in the best interests of the
Company. Any act, or failure to act, based upon authority given pursuant to a
resolution duly adopted by the Board or upon the instructions of the Chief
Executive Officer or based upon the advice of counsel for the Company shall be
conclusively presumed to be done, or omitted to be done, by the Executive in
good faith and in the best interests of the Company. The cessation of employment
of the Executive shall not be deemed to be for Cause unless and until there
shall have been delivered to the Executive a copy of a resolution duly adopted
by the affirmative vote of not less than three-quarters of the entire membership
of the Board at a meeting of the Board called and held for such purpose (after
reasonable notice is provided to the Executive and the Executive is given an
opportunity, together with counsel, to be heard before the Board), finding that,
in the good faith opinion of the Board, the Executive is guilty of the conduct
described in subparagraph (i) or (ii) above, and specifying the particulars
thereof in detail.

                  (c) Good Reason. The Executive's employment may be terminated
by the Executive during the Employment Period for Good Reason. For purposes of
this Agreement, "Good Reason" shall mean:

                           (i) the assignment to the Executive of any duties
         inconsistent in any respect with the Executive's position (including
         status, offices, titles and reporting requirements), authority, duties
         or responsibilities as contemplated by Section 2(a) of this Agreement,
         or any other action by the Company that results in a diminution in such
         position, authority, duties or responsibilities, excluding for this
         purpose an isolated, insubstantial and inadvertent action not taken in
         bad faith and that is remedied by the Company promptly after receipt of
         notice thereof given by the Executive;

                           (ii) the assignment to the Executive of any duties
         inconsistent in any respect with the Executive's position (including
         status, offices, titles and reporting

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         requirements), authority, duties or responsibilities as contemplated by
         Section 2(a) of this Agreement, or any other action by the Company that
         results in a diminution in such position, authority, duties or
         responsibilities, if there were to occur a merger, consolidation or
         other business combination involving the Company where the Company
         ceases to be publicly traded and following the transaction the
         Executive does not have the status, office, title and reporting
         requirements at the ultimate parent company that are substantially
         similar to that which the Executive has with the Company;

                           (iii) any failure by the Company to comply with any
         of the provisions of Section 2(b) of this Agreement, other than an
         isolated, insubstantial and inadvertent failure not occurring in bad
         faith and that is remedied by the Company promptly after receipt of
         notice thereof given by the Executive;

                           (iv) the Company's requiring the Executive to be
         based at any office or location other than as provided in Section
         2(a)(i)(B) hereof or the Company's requiring the Executive to travel on
         Company business to a substantially greater extent than reasonably
         required in the conduct of Executive's duties hereunder;

                           (v) any purported termination by the Company of the
         Executive's employment otherwise than as expressly permitted by this
         Agreement; or

                           (vi) any failure by the Company to comply with and
         satisfy Section 9(c) of this Agreement.

                  For purposes of this Section 3(c), any good faith
determination of "Good Reason" made by the Executive shall be conclusive.

                  (d) Notice of Termination. Any termination during the
Employment Period by the Company for Cause, or by the Executive for Good Reason,
shall be communicated by Notice of Termination to the other party hereto given
in accordance with Section 10(b) of the Agreement. For purposes of this
Agreement, a "Notice of Termination" means a written notice that (i) indicates
the specific termination provision in this Agreement relied upon, (ii) to the
extent applicable, sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive's employment under
the provision so indicated and (iii) if the Date of Termination (as defined
below) is other than the date of receipt of such notice, specifies the
termination date (which date shall be not more than 30 days after the giving of
such notice). The failure by the Executive or the Company to set forth in the
Notice of Termination any fact or circumstance that contributes to a showing of
Good Reason or Cause shall not waive any right of the Executive or the Company,
respectively, from asserting such fact or circumstance in enforcing the
Executive's or the Company's rights hereunder.

                  (e) Date of Termination. "Date of Termination" shall mean:

                           (i) if the Executive's employment is terminated by
         the Company for Cause, or by the Executive for Good Reason, the date of
         receipt of the Notice of Termination or any later date specified
         therein, as the case may be;

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                           (ii) if the Executive's employment is terminated by
         the Company other than for Cause, death or Disability, the Date of
         Termination shall be the date on which the Company notifies the
         Executive of such termination; and

                           (iii) if the Executive's employment is terminated by
         reason of death or Disability, the Date of Termination shall be the
         date of death of the Executive or the Disability Effective Date, as the
         case may be.

         4. Obligations of the Company Upon Termination.

                  (a) Good Reason; Other than For Cause, Death or Disability:
Not Following a Change of Control. If, during the Employment Period, the Company
shall terminate the Executive's employment other than for Cause, death or
Disability, or the Executive shall terminate employment for Good Reason, and
such termination does not occur within two years following a Change of Control
(as defined in Section 10(f)):

                           (i) The Company shall pay to the Executive in a lump
         sum in cash within 30 days after the Date of Termination the aggregate
         of the following amounts:

                                    (A) the sum of (1) the Executive's Annual
                  Base Salary through the Date of Termination to the extent not
                  theretofore paid, (2) the product of (x) the higher of (I) the
                  highest Annual Bonus received by the Executive from the
                  Company over the preceding three year period (for purposes of
                  determining this amount in the event of termination prior to
                  December 31, 2001, an amount equal to 60% of Annual Base
                  Salary shall be utilized), including any bonus or portion
                  thereof that has been earned but deferred and (II) in the
                  event a bonus has been earned but not yet paid in connection
                  with the most recently completed fiscal year during the
                  Employment Period, the amount of such bonus that has been
                  earned plus any portion thereof that has been earned but
                  deferred , if any (such higher amount being referred to as the
                  "Highest Annual Bonus" for purposes of Section 4(a), (b), (c)
                  and (d)) and (y) a fraction, the numerator of which is the
                  number of days in the current fiscal year through the Date of
                  Termination, and the denominator of which is 365, and (3) any
                  compensation previously deferred by the Executive under a plan
                  sponsored by the Company (together with any accrued interest
                  or earnings thereon), and any accrued vacation pay, in each
                  case to the extent not theretofore paid (the sum of the
                  amounts described in clauses (1), (2) and (3) shall be
                  hereinafter referred to as the "Accrued Obligations" for
                  purposes of this Sections 4(a), (b), (c) and (d)), and

                                    (B) an amount equal to two times the sum of
                  (i) the then current Annual Base Salary of the Executive and
                  (ii) the Highest Annual Bonus, and

                                    (C) an amount equal to the total of the
                  employer matching contributions credited to the Executive
                  under the Company's 401(k) Savings Plan (the "401(k) Plan") or
                  any other deferred compensation plan during the 12-month
                  period immediately preceding the month of the Executive's Date
                  of Termination

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                  (provided, however, if termination occurs prior to the two
                  year anniversary of the date of this Agreement, a minimum
                  amount equal to $4,000 shall be utilized for 401(k) matching
                  contributions and a minimum amount of $37,500 shall be
                  utilized for EDC contributions) multiplied by two, such amount
                  to be grossed up so that the amount the Executive actually
                  receives after payment of any federal or state taxes payable
                  thereon equals the amount first described above.

                           (ii) For a period of two years from the Executive's
         Date of Termination (the "Remaining Contract Term" for purposes of this
         Sections 4(a), (b) and (c)) or such longer period as may be provided by
         the terms of the appropriate plan, program, practice or policy, the
         Company shall continue benefits to the Executive and/or the Executive's
         family equal to those that would have been provided to them in
         accordance with the plans, programs, practices and policies described
         in Section 2(b)(iv) of this Agreement if the Executive's employment had
         not been terminated; provided, however, that with respect to any of
         such plans, programs, practices or policies requiring an employee
         contribution, the Executive shall continue to pay the monthly employee
         contribution for same, and provided further, that if the Executive
         becomes reemployed by another employer and is eligible to receive
         medical or other welfare benefits under another employer provided plan,
         the medical and other welfare benefits described herein shall be
         secondary to those provided under such other plan during such
         applicable period of eligibility;

                           (iii) The Company shall, at its sole expense as
         incurred, provide the Executive with outplacement services, the scope
         and provider of which shall be selected by the Executive in his sole
         discretion;

                           (iv) All benefits under the Company's Executive
         Deferred Compensation Plan and the 401(k) Plan and any other similar
         plans, but excluding any stock options or restricted stock held by the
         Executive (the terms of such stock options or restricted stock to be
         governed by the agreements and plans governing such grants), not
         already vested shall be 100% vested, to the extent such vesting is
         permitted under the Code (as defined below);

                           (v) All country club memberships, luncheon clubs and
         other memberships that the Company was providing for the Executive's
         use at the time Notice of Termination is given shall, to the extent
         possible, be transferred and assigned to the Executive at no cost to
         the Executive (other than income taxes owed), the cost of transfer, if
         any, to be borne by the Company;

                           (vi) The Company shall either transfer to the
         Executive ownership and title to the Executive's company car at no cost
         to the Executive (other than income taxes owed) or, if the Executive
         receives a monthly car allowance in lieu of a Company car, pay the
         Executive a lump sum in cash within 30 days after the Executive's Date
         of Termination equal to the Executive's annual car allowance multiplied
         by two;

                           (vii) To the extent not theretofore paid or provided,
         the Company shall timely pay or provide to the Executive any other
         amounts or benefits required to be paid or provided or that the
         Executive is eligible to receive under any plan, program, policy or

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         practice or contract or agreement of the Company and its affiliated
         companies (such other amounts and benefits shall be hereinafter
         referred to as the "Other Benefits" for purposes of this Sections 4(a),
         (b), (c) and (d)); and

                           (viii) The foregoing payments are intended to
         compensate the Executive for a breach of the Company's obligations and
         place Executive in substantially the same position had the employment
         of the Executive not been so terminated as a result of a breach by the
         Company.

                  (b) Death. If Executive's employment is terminated by reason
of the Executive's death during the Employment Period, this Agreement shall
terminate without further obligations to the Executive's legal representatives
under this Agreement, other than for payment of Accrued Obligations and the
timely payment or provision of Other Benefits. Accrued Obligations shall be paid
to the Executive's estate or beneficiaries, as applicable, in a lump sum in cash
within 30 days after the Date of Termination. With respect to the provision of
Other Benefits, the term Other Benefits as utilized in this Section 4(b) shall
include, without limitation, and the Executive's estate and/or beneficiaries
shall be entitled to receive, benefits at least equal to the most favorable
benefits provided by the Company and affiliated companies to the estates and
beneficiaries of the Executive's peer executives of the Company and such
affiliated companies under such plans, programs, practices and policies relating
to death benefits, if any, in effect generally on the date hereof or, if more
favorable, those in effect on the date of the Executive's death.

                  (c) Disability. If the Executive's employment is terminated by
reason of the Executive's Disability during the Employment Period, this
Agreement shall terminate without further obligations to the Executive, other
than for payment of Accrued Obligations and the timely payment or provision of
Other Benefits. Accrued Obligations shall be paid to the Executive in a lump sum
in cash within 30 days after the Date of Termination. With respect to the
provision of Other Benefits, the term Other Benefits as utilized in this Section
4(c) shall include, without limitation, and the Executive shall be entitled
after the Disability Effective Date to receive, disability and other benefits at
least equal to the most favorable benefits generally provided by the Company and
its affiliated companies to the Executive's disabled peer executives and/or
their families in accordance with such plans, programs, practices and policies
relating to disability, if any, in effect generally on the date hereof or, if
more favorable, those in effect at the time of the Disability.

                  (d) Cause; Other Than for Good Reason. If the Executive's
employment is terminated for Cause during the Employment Period, this Agreement
shall terminate without further obligations to the Executive, other than the
obligation to pay to the Executive (x) his or her Annual Base Salary through the
Date of Termination, (y) the amount of any compensation previously deferred by
the Executive and (z) Other Benefits, in each case to the extent theretofore
unpaid. If the Executive voluntarily terminates employment during the Employment
Period, excluding a termination for Good Reason, this Agreement shall terminate
without further obligations to the Executive, other than for Accrued Obligations
and the timely payment or provision of Other Benefits. In such case, all Accrued
Obligations shall be paid to the Executive in a lump sum in cash within 30 days
after the Date of Termination subject to such other options or restrictions as
provided by law.

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                  (e) Good Reason; Other than For Cause, Death or Disability:
Following a Change of Control. If, during the Employment Period, the Company
shall terminate the Executive's employment other than for Cause, death or
Disability, or the Executive shall terminate employment for Good Reason, in each
case within two years following a Change of Control:

                           (i) The Company shall pay to the Executive in a lump
         sum in cash within 30 days after the Date of Termination the aggregate
         of the following amounts:

                                    (A) the sum of (1) the Executive's Annual
                  Base Salary through the Date of Termination to the extent not
                  theretofore paid, (2) the product of (x) the higher of (I) the
                  highest Annual Bonus received by the Executive from the
                  Company over the preceding three year period (for purposes of
                  determining this amount in the event of termination prior to
                  December 31, 2001, an amount equal to 60% of Annual Base
                  Salary shall be utilized), including any bonus or portion
                  thereof that has been earned but deferred and (II) in the
                  event a bonus has been earned but not yet paid in connection
                  with the most recently completed fiscal year during the
                  Employment Period, the amount of such bonus that has been
                  earned plus any portion thereof that has been earned but
                  deferred , if any (such higher amount being referred to as the
                  "Highest Annual Bonus" for purposed of this section 4(e)) and
                  (y) a fraction, the numerator of which is the number of days
                  in the current fiscal year through the Date of Termination,
                  and the denominator of which is 365, and (3) any compensation
                  previously deferred by the Executive under a plan sponsored by
                  the Company (together with any accrued interest or earnings
                  thereon), and any accrued vacation pay, in each case to the
                  extent not theretofore paid (the sum of the amounts described
                  in clauses (1), (2) and (3) shall be hereinafter referred to
                  as the "Accrued Obligations" for purposes of this Section
                  4(e)), and

                                    (B) an amount equal to three times the sum
                  of (i) the then current Annual Base Salary of the Executive
                  and (ii) the Highest Annual Bonus, and

                                    (C) an amount equal to the total of the
                  employer matching contributions credited to the Executive
                  under the Company's 401(k) Savings Plan (the "401(k) Plan") or
                  any other deferred compensation plan during the 12-month
                  period immediately preceding the month of the Executive's Date
                  of Termination (provided, however, if termination occurs prior
                  to the two year anniversary of the date of this Agreement, a
                  minimum amount equal to $4,000 shall be utilized for purposes
                  of 401(k) matching contributions and a minimum amount of
                  $37,500 shall be utilized for EDC contributions) multiplied by
                  three, such amount to be grossed up so that the amount the
                  Executive actually receives after payment of any federal or
                  state taxes payable thereon equals the amount first described
                  above.

                           (ii) For a period of three years from the Executive's
         Date of Termination (the "Remaining Contract Term" for purposes of this
         Section 4(e)) or such longer period as may be provided by the terms of
         the appropriate plan, program, practice or policy, the Company shall
         continue benefits to the Executive and/or the Executive's family equal
         to those that would have been provided to them in accordance with the
         plans, programs,

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         practices and policies described in Section 2(b)(iv) of this Agreement
         if the Executive's employment had not been terminated; provided,
         however, that with respect to any of such plans, programs, practices or
         policies requiring an employee contribution, the Executive shall
         continue to pay the monthly employee contribution for same, and
         provided further, that if the Executive becomes reemployed by another
         employer and is eligible to receive medical or other welfare benefits
         under another employer provided plan, the medical and other welfare
         benefits described herein shall be secondary to those provided under
         such other plan during such applicable period of eligibility;

                           (iii) The Company shall, at its sole expense as
         incurred, provide the Executive with outplacement services, the scope
         and provider of which shall be selected by the Executive in his sole
         discretion;

                           (iv) All benefits under the Company's Executive
         Deferred Compensation Plan and the 401(k) Plan and any other similar
         plans, but excluding any stock options or restricted stock held by the
         Executive (the terms of such stock options or restricted stock to be
         governed by the agreements and plans governing such grants), not
         already vested shall be 100% vested, to the extent such vesting is
         permitted under the Code (as defined below);

                           (v) All country club memberships, luncheon clubs and
         other memberships that the Company was providing for the Executive's
         use at the time Notice of Termination is given shall, to the extent
         possible, be transferred and assigned to the Executive at no cost to
         the Executive (other than income taxes owed), the cost of transfer, if
         any, to be borne by the Company;

                           (vi) The Company shall either transfer to the
         Executive ownership and title to the Executive's company car at no cost
         to the Executive (other than income taxes owed) or, if the Executive
         receives a monthly car allowance in lieu of a Company car, pay the
         Executive a lump sum in cash within 30 days after the Executive's Date
         of Termination equal to the Executive's annual car allowance multiplied
         by three;

                           (vii) To the extent not theretofore paid or provided,
         the Company shall timely pay or provide to the Executive any other
         amounts or benefits required to be paid or provided or that the
         Executive is eligible to receive under any plan, program, policy or
         practice or contract or agreement of the Company and its affiliated
         companies (such other amounts and benefits shall be hereinafter
         referred to as the "Other Benefits" for purposes of this Section 4(e));
         and

                           (viii) The foregoing payments are intended to
         compensate the Executive for a breach of the Company's obligations and
         place Executive in substantially the same position had the employment
         of the Executive not been so terminated as a result of a breach by the
         Company.

         5. Other Rights. Except as provided hereinafter, nothing in this
Agreement shall prevent or limit the Executive's continuing or future
participation in any plan, program, policy or

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practice provided by the Company or any of its affiliated companies and for
which the Executive may qualify, nor shall anything herein limit or otherwise
affect such rights as the Executive may have under any contract or agreement
with the Company or any of its affiliated companies. Except as provided
hereinafter, amounts that are vested benefits or that the Executive is otherwise
entitled to receive under any plan, policy, practice or program of or any
contract or agreement with the Company or any of its affiliated companies at or
subsequent to the Date of Termination shall be payable in accordance with such
plan, policy, practice or program or contract or agreement. It is expressly
agreed by the Executive that he or she shall have no right to receive, and
hereby waives any entitlement to, any severance pay or similar benefit under any
other plan, policy, practice or program of the Company. In addition, if the
Executive has an employment or similar agreement with the Company at the Date of
Termination, he or she agrees that he or she shall have the right to receive all
of the benefits provided under this Agreement or such other agreement, whichever
one, in its entirety, the Executive chooses, but not both agreements, and when
the Executive has made such election, the other agreement shall be superseded in
its entirety and shall be of no further force and effect. The Executive also
agrees that to the extent he or she may be eligible for any severance pay or
similar benefit under any laws providing for severance or termination benefits,
such other severance pay or similar benefit shall be coordinated with the
benefits owed hereunder, such that the Executive shall not receive duplicate
benefits.

         6. Full Settlement.

                  (a) No Rights of Offset. The Company's obligation to make the
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action that the Company may have against the
Executive or others.

                  (b) No Mitigation Required. In no event shall the Executive be
obligated to seek other employment or take any other action by way of mitigation
of the amounts payable to the Executive under any of the provisions of this
Agreement and such amounts shall not be reduced whether or not the Executive
obtains other employment.

                  (c) Legal Fees. The Company agrees to pay as incurred, to the
full extent permitted by law, all legal fees and expense that the Executive may
reasonably incur as a result of any contest (regardless of the outcome thereof)
by the Company or the Executive of the validity or enforceability of, or
liability under, any provision of this Agreement or any guarantee of performance
thereto (including as a result of any contest by the Executive about the amount
of any payment pursuant to this Agreement), plus in each case interest on any
delayed payment at the applicable Federal rate provided for in Section
7872(f)(2)(A) of the Internal Revenue Code of 1986, as amended (the "Code").

         7. Certain Additional Payments by the Company.

                  (a) Although this Agreement is not being entered into in
connection with or contingent upon a change of control of the Company, anything
in this Agreement to the contrary notwithstanding and except as set forth below,
in the event it shall be determined that any payment or distribution by the
Company to or for the benefit of the Executive (whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise, but determined

                                      -11-
<PAGE>   12

without regard to any additional payments required under this Section 7) (a
"Payment") would be subject to the excise tax imposed by Section 4999 of the
Code or any interest or penalties are incurred by the Executive with respect to
such excise tax (such excise tax, together with any such interest and penalties,
are hereinafter collectively referred to as the "Excise Tax"), then the
Executive shall be entitled to receive an additional payment (a "Gross-Up
Payment") in an amount such that after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment,
the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments. Notwithstanding the foregoing provisions of this
Section 7(a), if it shall be determined that the Executive is entitled to a
Gross-Up Payment, but that the Executive, after taking into account the Payments
and the Gross-Up Payment, would not receive a net after-tax benefit of at least
$50,000 (taking into account both income taxes and any Excise Tax) as compared
to the net after-tax proceeds to the Executive resulting from an elimination of
the Gross-Up Payment and a reduction of the Payments, in the aggregate, to an
amount (the "Reduced Amount") such that the receipt of Payments would not give
rise to any Excise Tax, then no Gross-Up Payment shall be made to the Executive
and the Payments, in the aggregate, shall be reduced to the Reduced Amount.

                  (b) Subject to the provisions of Section 7(c), all
determinations required to be made under this Section 7, including whether and
when a Gross-Up Payment is required and the amount of such Gross-Up Payment and
the assumptions to be utilized in arriving at such determination, shall be made
by Ernst & Young LLP or, as provided below, such other certified public
accounting firm as may be designated by the Executive (the "Accounting Firm"),
which shall provide detailed supporting calculations both to the Company and the
Executive within 15 business days after the receipt of notice from the Executive
that there has been a Payment, or such earlier time as is requested by the
Company. In the event that the Accounting Firm is serving as accountant or
auditor for the individual, entity or group effecting the change of control, the
Executive shall appoint another nationally recognized accounting firm to make
the determinations required hereunder (which accounting firm shall then be
referred to as the Accounting Firm hereunder). All fees and expenses of the
Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment, as
determined pursuant to this Section 7, shall be paid by the Company to the
Executive within five days after the receipt of the Accounting Firm's
determination. Any determination by the Accounting Firm shall be binding upon
the Company and the Executive. As a result of the uncertainty in the application
of Section 4999 of the Code at the time of the initial determination by the
Accounting Firm hereunder, it is possible that Gross-Up Payments that will not
have been made by the Company should have been made ("Underpayment"), consistent
with the calculations required to be made hereunder. In the event that the
Company exhausts its remedies pursuant to Section 7(c) and the Executive
thereafter is required to make a payment of any Excise Tax, the Accounting Firm
shall determine the amount of the Underpayment that has occurred and any such
Underpayment shall be promptly paid by the Company to or for the benefit of the
Executive.

                  (c) The Executive shall notify the Company in writing of any
claim by the Internal Revenue Service that, if successful, would require the
payment by the Company of the Gross-Up Payment (or an additional Gross-Up
Payment) in the event the IRS seeks higher payment. Such notification shall be
given as soon as practicable, but no later than ten business days after the
Executive is informed in writing of such claim, and shall apprise the Company of
the nature of such claim and the date on which such claim is requested to be
paid. The Executive shall not pay such

                                      -12-
<PAGE>   13

claim prior to the expiration of the 30-day period following the date on which
he gives such notice to the Company (or such shorter period ending on the date
that any payment of taxes with respect to such claim is due). If the Company
notifies the Executive in writing prior to the expiration of such period that it
desires to contest such claim, the Executive shall:

                           (i) give the Company any information reasonably
         requested by the Company relating to such claim,

                           (ii) take such action in connection with contesting
         such claim as the Company shall reasonably request in writing from time
         to time, including, without limitation, accepting legal representation
         with respect to such claim by an attorney reasonably selected by the
         Company,

                           (iii) cooperate with the Company in good faith
         effectively to contest such claim, and

                           (iv) permit the Company to participate in any
         proceedings relating to such claims; provided, however, that the
         Company shall bear and pay directly all costs and expenses (including
         additional interest and penalties) incurred in connection with such
         costs and shall indemnify and hold the Executive harmless, on an
         after-tax basis, for any Excise Tax or income tax (including interest
         and penalties with respect thereto) imposed as a result of such
         representation and payment of costs and expenses. Without limitation on
         the foregoing provisions of this Section 7(c), the Company shall
         control all proceedings taken in connection with such contest and, at
         its sole option, may pursue or forego any and all administrative
         appeals, proceedings, hearings and conferences with the taxing
         authority in respect of such claim and may, at its sole option, either
         direct the Executive to pay the tax claimed and sue for a refund or
         contest the claim in any permissible manner, and the Executive agrees
         to prosecute such contest to determination before any administrative
         tribunal, in a court of initial jurisdiction and in one or more
         appellate courts, as the Company shall determine; provided, however,
         that if the Company directs the Executive to pay such claim and sue for
         a refund, the Company shall advance the amount of such payment to the
         Executive, on an interest-free basis, and shall indemnify and hold the
         Executive harmless, on an after-tax basis, from any Excise Tax or
         income tax (including interest or penalties with respect thereto)
         imposed with respect to such advance or with respect to any imputed
         income with respect to such advance; and further provided that any
         extension of the statute of limitations relating to payment of taxes
         for the taxable year of the Executive with respect to which such
         contested amount is claimed to be due is limited solely to such
         contested amount. Furthermore, the Company's control of the contest
         shall be limited to issues with respect to which a Gross-Up Payment
         would be payable hereunder and the Executive shall be entitled to
         settle or contest, as the case may be, any other issues raised by the
         Internal Revenue Service or any other taxing authority.

                  (d) If, after the receipt by the Executive of an amount
advanced by the Company pursuant to Section 7(c), the Executive becomes entitled
to receive any refund with respect to such claim, the Executive shall (subject
to the Company's complying with the requirements of Section 7(c)) promptly pay
to the Company the amount of such refund (together with any interest paid or
credited thereon after taxes applicable thereto). If, after the receipt by the
Executive of an amount

                                      -13-
<PAGE>   14

advanced by the Company pursuant to Section 7(c), a determination is made that
the Executive shall not be entitled to any refund with respect to such claim and
the Company does not notify the Executive in writing of its intent to contest
such denial of refund prior to the expiration of 30 days after such
determination, then such advance shall be forgiven and shall not be required to
be repaid and the amount of such advance shall offset, to the extent thereof,
the amount of Gross-Up Payment required to be paid.

         8. Confidential Information. The Executive shall hold in a fiduciary
capacity for the benefit of the Company all secret or confidential information,
knowledge or data relating to the Company or any of its affiliated companies,
and their respective businesses, that shall have been obtained by the Executive
during the Executive's employment by the Company or any of its affiliated
companies, provided that it shall not apply to information that is or shall
become public knowledge (other than by acts by the Executive or representatives
of the Executive in violation of this Agreement), information that is developed
by the Executive independently of such information, or knowledge or data or
information that is disclosed to the Executive by a third party under no
obligation of confidentiality to the Company. After termination of the
Executive's employment with the Company, the Executive shall not, without the
prior written consent of the Company or as may otherwise be required by law or
legal process, communicate or divulge any such information, knowledge or data to
anyone other than the Company and those designated by it. In no event shall an
asserted violation of the provisions of this Section 8 constitute a basis for
deferring or withholding any amounts otherwise payable to the Executive under
this Agreement.

         9. Successors.

                  (a) This Agreement is personal to the Executive and shall not
be assignable by the Executive otherwise than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by
the Executive's legal representatives.

                  (b) This Agreement shall inure to the benefit of and be
binding upon the Company and its successors and assigns.

                  (c) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. As used in this Agreement, "Company" shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as
aforesaid that assumes and agrees to perform this Agreement by operation of law,
or otherwise.

         10. Miscellaneous.

                  (a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, WITHOUT REFERENCE TO PRINCIPLES
OF CONFLICT OF LAWS. The captions of this Agreement are not part of the
provisions hereof and shall have no force or effect. This Agreement may not be
amended or modified otherwise than by a written agreement executed by the
parties hereto or their respective successors and legal representatives.

                                      -14-
<PAGE>   15

                  (b) All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:

                  If to the Executive:    Louis Raspino
                                          Grant Prideco, Inc.
                                          1450 Lake Robbins Drive, Suite 600
                                          The Woodlands, Texas 77380

                  If to the Company:      Grant Prideco, Inc.
                                          1450 Lake Robbins Drive, Suite 600
                                          The Woodlands, Texas 77380
                                          Attention: President and CEO

                  with a copy to:         Charles H. Still
                                          Fulbright & Jaworski L.L.P.
                                          1301 McKinney, Suite 5100
                                          Houston, Texas 77010-3095

or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notices and communications shall be effective
when actually received by the addressee.

                  (c) The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.

                                      -15-
<PAGE>   16

                  (d) The Company may withhold from any amounts payable under
this Agreement such Federal, state, local or foreign taxes as shall be required
to be withheld pursuant to any applicable law or regulation.

                  (e) The Executive's or the Company's failure to insist upon
strict compliance with any provision of this Agreement or the failure to assert
any right the Executive or the Company may have hereunder, including, without
limitation, the right of the Executive to terminate employment for Good Reason
pursuant to Section 3(c)(i)-(v) of this Agreement, shall not be deemed to be a
waiver of such provision or right or any other provision or right of this
Agreement.

                  (f) A "Change of Control" shall mean:

                           (i) The acquisition by any individual, entity or
group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) (a "Person") of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 50 percent or more of either (A) the then outstanding shares of
common stock of the Company (the "Outstanding Company Common Stock") or (B) the
combined voting power of the then outstanding voting securities of the Company
entitled to vote generally in the election of directors (the "Outstanding
Company Voting Securities"); provided, however, that for purposes of this
subsection (i), the following acquisitions shall not constitute a Change of
Control:

                                    (A) any acquisition directly from the
Company; or

                                    (B) any acquisition by the Company; or

                                    (C) any acquisition by any employee benefit
plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company; or

                                    (D) any acquisition by any corporation
pursuant to a transaction that complies with clauses (A), (B) and (C) of
subsection (iii) of this Section 1(c); or

                           (ii) Individuals, who, as of the date hereof,
constitute the Board (the "Incumbent Board") cease for any reason to constitute
at least a majority of the Board; provided, however, that any individual
becoming a director subsequent to the date hereof whose election, or nomination
for election by the Company's stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual was a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board; or

                           (iii) Consummation of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company (a "Corporate Transaction") in each case, unless,
following such Corporate Transaction, (A) all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the
Outstanding Company Common Stock and Outstanding Company Voting Securities
immediately prior to such

                                      -16-
<PAGE>   17

Corporate Transaction beneficially own, directly or indirectly, more than 60
percent of, respectively, the then outstanding shares of common stock and the
combined voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Corporate Transaction (including, without limitation, a
corporation that as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership,
immediately prior to such Corporate Transaction, of the Outstanding Company
Common Stock and the Outstanding Company Voting Securities, as the case may be,
(B) no Person (excluding any corporation resulting from such Corporate
Transaction or any employee benefit plan (or related trust) of the Company or
such corporation resulting from such Corporate Transaction) beneficially owns,
directly or indirectly, 20 percent or more of, respectively, the then
outstanding shares of common stock of the corporation resulting from such
Corporate Transaction or the combined voting power of the then outstanding
voting securities of such corporation except to the extent that such ownership
existed prior to the Corporate Transaction and (C) at least a majority of the
members of the board of directors of the corporation resulting from such
Corporate Transaction were members of the Incumbent Board at the time of the
execution of the initial agreement, or of the action of the Board, providing for
such Corporate Transaction; or

                           (iv) Approval by the stockholders of the Company of a
complete liquidation or dissolution of the Company.

Anything in this Agreement to the contrary notwithstanding, if a Change of
Control occurs and if the Executive's employment with the Company is terminated
prior to the date on which the Change of Control occurs, and if it is reasonably
demonstrated by the Executive that such termination of employment (i) was at the
request of a third party who has taken steps reasonably calculated to effect a
Change of Control or (ii) otherwise arose in connection with or anticipation of
a Change of Control, then for all purposes of this Agreement the date upon which
the Change of Control occurred shall mean the date immediately prior to the date
of such termination of employment.

                                      -17-
<PAGE>   18

      IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand
and, pursuant to the authorization from its Board of Directors, the Company has
caused these presents to be executed in its name on its behalf, all as of the
day and year first above written.

                                  /s/ Louis Raspino
                                  ---------------------------------------------
                                                  Louis  Raspino

                                  GRANT PRIDECO, INC.

                                  By   /s/ Curtis W. Huff
                                     -------------------------------------------
                                  Name: Curtis W. Huff
                                        ----------------------------------------
                                  Title: President and CEO
                                        ----------------------------------------

                                      -18-<PAGE>   1
                                 PROMISSORY NOTE

$22,500,000.00                                           Oklahoma City, Oklahoma
                                                                   July 23, 2001

                  FOR VALUE RECEIVED, the undersigned, SEVEN SEAS PETROLEUM
INC., a Cayman Islands exempted company limited by shares (the "Borrower"),
promises to pay to the order of CHESAPEAKE ENERGY CORPORATION, an Oklahoma
corporation (the payee, its successors and assigns are hereinafter called the
"Lender"), at 6100 North Western Avenue, Oklahoma City, Oklahoma, or at such
other place as may be designated in writing by the Lender, the principal sum of
TWENTY-TWO MILLION FIVE HUNDRED THOUSAND DOLLARS ($22,500,000.00), plus all
Additional Amounts (as hereinafter defined) together with interest thereon at
the rates hereinafter stated:

                  Prior to Default the unpaid principal balance of this Note
                  will bear interest at the per annum rate equal to twelve
                  percent (12%). Interest will accrue and be compounded
                  quarterly through July 23, 2003 and the interest accrued as of
                  July 23, 2003 will continue to compound quarterly and will be
                  payable on the Maturity Date of this Note. Interest accruing
                  on this Note after July 23, 2003 will be paid quarterly
                  commencing on October 23, 2003, and on the twenty-third (23rd)
                  day of each successive January, April, July and October
                  thereafter until this Note is paid in full. All interest will
                  be computed for the actual number of days elapsed at a per
                  diem charge based on a year consisting of three hundred sixty
                  (360) days.

                  Provided that no event of Default has occurred or is
                  continuing under the Loan Agreement (as hereafter defined) or
                  any of the documents or instruments executed in connection
                  therewith, there will be no required principal payments due on
                  this Note until the Maturity Date. The entire unpaid principal
                  balance of this Note plus all accrued and unpaid interest
                  thereon plus all Additional Amounts will be due and payable on
                  the Maturity Date.

1. Definitions. Unless otherwise defined herein, all terms defined or referenced
in that certain Note Purchase and Loan Agreement dated July 9, 2001, among the
Borrower, the Subsidiaries and the Lender (the "Loan Agreement") will have the
same meanings herein as therein defined. As used in this Note, "Maturity Date"
means the earlier of: (a) the date the Lender notifies the Borrower that the
unpaid principal balance of this Note is due based on the occurrence of an event
of Default which has not been timely cured; or (b) November 7, 2004.

SEVEN SEAS PETROLEUM INC.
PROMISSORY NOTE

<PAGE>   2

2. Advances. This Note is executed and delivered in connection with the Loan
Agreement. Advances and payments hereunder may, at the option of the Lender, be
recorded on this Note or on the books and records of the Lender and will be
prima facie evidence of said advances, payments and unpaid balance of this Note.
It is specifically agreed that the aggregate of advances made during the term of
this Note will not exceed the face amount hereof. All payments on this Note will
be applied first to the payment of accrued interest and the balance will be
applied in reduction of the principal balance hereof provided that no payment
will be applied to this Note until received by the Lender in collected funds.
All advances made or to be made under this Note will be made subject to the
terms and conditions stated in the Loan Agreement.

3. Additional Amounts. The Borrower will make all payments of principal of,
premium, if any, and interest on this Note free and clear of, and without
withholding or deduction for or on account of, any current or future taxes,
levies, imports, deductions, withholdings, collections, duties, assessments or
charges of whatever nature and any fines, penalties, interest or liabilities
with respect thereto imposed, levied, collected, withheld or assessed by or on
behalf the Cayman Islands, Colombia, Panama, Canada or any other jurisdiction
with which Seven Seas has any connection (including any jurisdiction from or
through which payments under this Note are made) or any political subdivision or
authority therein or thereof having power to tax (referred to herein as a "Tax"
or "Taxes"), unless such withholding or deduction is required by law or by
regulation or governmental policy having the force of law. In the event that any
such withholding or deduction for or on account of any Tax is required,
(excluding any Taxes imposed on the Lender by the jurisdiction (or by a
political subdivision thereof) under the laws of which (or under the laws of a
political subdivision of which) the Lender is organized (such excluded Taxes are
referred to herein as "Excluded Taxes")), the Borrower will pay such additional
amounts ("Additional Amounts") as will result in receipt by the Lender of such
amounts as would have been received by the Lender had no such withholding or
deduction of Taxes been required, provided that:

                  No Additional Amounts shall be payable for or on account of
any Tax which would not have been imposed but for:

                           (a) the existence of any present or former connection
between the Lender and the Cayman Islands, Colombia, Panama, Canada or any other
jurisdiction with which the Borrower has any connection (including any
jurisdiction from or through which payments under this Note are made) or any
political subdivision or authority therein (other than merely holding this
Note), including, without limitation, the Lender being or having been engaged in
business therein or having had a permanent establishment therein;

                           (b) the presentation of this Note (where presentation
is required) more than 30 days after the date on which the payment in respect of
this Note became due and payable or provided for, whichever is later, except to
the extent that the Lender would have been entitled to such Additional Amounts
if it had presented this Note for payment on any day within such period of 30
days;

                           (c) the failure of the Lender to comply with a
request by the Borrower addressed to the Lender (i) to provide information
concerning the nationality, residence or identity

SEVEN SEAS PETROLEUM INC.
PROMISSORY NOTE

                                      -2-

<PAGE>   3

of the Lender or (ii) to make any declaration or other similar claim or satisfy
any information or reporting requirement, which, in the case of (i) or (ii), is
required or imposed by a statute, treaty, regulation or administrative practice
of the taxing jurisdiction as a precondition to exemption from all or part of
such tax, assessment or other governmental charge; or

                           (d) any combination of items (a) , (b) and (c).

                  In the event that the Borrower fails to pay any Taxes (other
than Excluded Taxes) when due to the appropriate taxing authority and the Lender
is subsequently assessed by such taxing authority in respect of such Taxes, the
Borrower will pay such Taxes assessed to the taxing authority. In the event that
the Lender has previously paid such Taxes to the taxing authority, the Borrower
will promptly indemnify and reimburse the Lender in respect of all such Taxes so
paid plus interest at the rate borne by this Note.

                  Whenever there is mentioned, in any context, the payment of
principal, premium or interest in respect of this Note or the net proceeds
received on the sale or exchange of this Note, such mention will be deemed to
include the payment of Additional Amounts provided for in this Note to the
extent that, in such context, Additional Amounts are, were or would be payable
in respect thereof pursuant to this Note.

4. Payments. All payments and prepayments of principal or interest on the Note
will be made to the Lender in collected and freely transferable funds at or
before 11:00 a.m. Oklahoma City, Oklahoma time on the date due. All payments
will be paid in full without set off or counterclaim. If any payment under this
Note becomes due and payable on a day other than a business day, the maturity
thereof will be extended to the next succeeding business day and such extension
of time will in such case be included in the computation of payments of
interest.

5. Prepayment. The Borrower will have the right to prepay this Note in whole or
in part at any time and from time to time without premium or penalty.

6. Expenses. The Borrower agrees that if, and as often as, this Note is placed
in the hands of an attorney for collection or to defend or enforce any of the
Lender's rights hereunder or under any instrument securing payment of this Note,
the Borrower will pay the Lender's reasonable attorneys' fees, all court costs
and all other expenses incurred by the Lender in connection therewith.

7. Default Interest. Any sum not paid when due, by acceleration or otherwise,
will bear interest at the per annum rate equal to thirteen percent (13%) and
such interest which has accrued will be paid at the time of and as a condition
precedent to curing any Default hereunder. During the existence of any such
Default, the Lender may apply any payments received on any amount due hereunder
or under the terms of any instrument now or hereafter evidencing or securing
this indebtedness as the Lender determines from time to time in the Lender's
sole discretion.

8. Financing Documents. This Note is issued by the Borrower and accepted by the
Lender pursuant to a lending transaction negotiated, consummated and to be
performed in Oklahoma City, Oklahoma. Payment of this Note is secured by and
subject to the terms and conditions of the Loan Agreement,

SEVEN SEAS PETROLEUM INC.
PROMISSORY NOTE

                                      -3-
<PAGE>   4

all of the Related Agreements and all other documents and instruments executed
in connection therewith or otherwise evidencing or securing payment hereof (the
"Financing Documents"). This Note is to be construed according to the internal
laws of the State of Oklahoma. All actions with respect to this Note, the
Financing Documents or any other instrument securing payment of this Note may be
instituted in the courts of the State of Oklahoma sitting in Oklahoma County,
Oklahoma, or the United States District Court sitting in Oklahoma City,
Oklahoma, as the Lender may elect, and by execution and delivery of this Note,
the Borrower irrevocably and unconditionally submits to the jurisdiction (both
subject matter and personal) of each such court and irrevocably and
unconditionally waives: (a) any objection the Borrower might now or hereafter
have to the venue in any such court; and (b) any claim that any action or
proceeding brought in any such court has been brought in an inconvenient forum.

9. Default. On the breach of any provision of this Note, the occurrence of any
event of Default under the Loan Agreement or any of the other Loan Documents or
any other instrument securing payment of this Note, at the option of the Lender,
the entire indebtedness evidenced by this Note will become immediately due,
payable and collectible then or thereafter as the Lender might elect, regardless
of the stated date of maturity hereof. Failure by the Lender to exercise such
option will not constitute a waiver of the right to exercise the same in the
event of any subsequent default.

10. Other Parties. The makers, endorsers, sureties, guarantors and all other
persons who may become liable for all or any part of this obligation severally
waive presentment for payment, protest and notice of nonpayment. Said parties
consent to any extension of time (whether one or more) of payment hereof,
release of all or any part of the security for the payment hereof or release of
any party liable for the payment of this obligation. Any such extension or
release may be made without notice to any such party and without discharging
such party's liability hereunder.

                  IN WITNESS WHEREOF, the Borrower has executed this instrument
effective the date first above written.

                                      SEVEN SEAS PETROLEUM INC., a Cayman
                                      Islands exempted company limited by shares

                                      By /s/ LARRY A. RAY
                                         ---------------------------------------
                                         Larry A. Ray, President

                                      (the "Borrower")

SEVEN SEAS PETROLEUM INC.
PROMISSORY NOTE
                                       -4-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00028-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00028-of-00352.parquet"}]]