Document:

EXHIBIT 10.1

                               MERIDIAN BANK TEXAS
                         100 Lexington Street, Ste. 100
                             Fort Worth, Texas 76102

December 7,  2009

GATEWAY ENERGY CORPORATION
1415 Louisiana Street, Suite 4100
Houston, Texas 77002

         Re:      Loan Agreement

Ladies and Gentlemen:

     This letter sets forth the Loan Agreement (this "Loan Agreement") among
GATEWAY ENERGY Corporation ("Borrower"), a Delaware corporation; GATEWAY
PIPELINE COMPANY; GATEWAY OFFSHORE PIPELINE COMPANY; GATEWAY PROCESSING COMPANY;
and GATEWAY ENERGY MARKETING COMPANY (collectively "Guarantors"); and MERIDIAN
BANK ("Lender"), with respect to loans from Lender to Borrower and obligations
of Borrower and Guarantors to Lender.

     1. Loan. (a) Subject to the terms and conditions set forth in this Loan
Agreement and the other agreements, instruments, and documents executed and
delivered in connection herewith (collectively the "Loan Documents"), Lender
agrees to make a revolving loan in the maximum amount of $6,000,000.00 to
Borrower (the "Revolving Loan") on the terms set forth in the Revolving
Promissory Note attached as Exhibit A (the "Revolving Note"), for the purposes
set forth below. The unpaid principal balance of the Revolving Note shall bear
interest from the date advanced until paid or until default or maturity at the
rates set forth in the Revolving Note; provided, however, that the interest rate
on the Revolving Note shall never fall below a floor rate of five and one-half
percent (5.5%) per annum. Subject to the terms and conditions hereof, Borrower
may borrow, repay, and reborrow on a revolving basis from time to time during
the period commencing on the date hereof and continuing through 11:00 a.m. (Fort
Worth, Texas time) on April 30, 2012 (the "Termination Date"), such amounts as
Borrower may request under the Revolving Loan; provided, however, the total
principal amount outstanding at any time shall not exceed the lesser of (i) the
aggregate sums permitted under the Borrowing Base (as defined below), which is
initially set at $3,000,000, subject to the MCR (as defined below), or (ii)
$6,000,000.00. All sums advanced under the Revolving Loan, together with all
accrued but unpaid interest thereon, shall be due and payable in full on the
Termination Date.

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DECEMBER 7, 2009
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          (b) Advances on the Revolving Loan may be used only for the following
purposes: (i) refinancing or replacing indebtedness, or a commitment to furnish
credit, owing by Borrower to Western National Bank ("WNB"); (ii) the acquisition
and development of midstream oil and gas assets; (iii) general corporate and
working capital purposes; and (iv) issuance of Letters of Credit (as defined
below).

          (c) At the request of Borrower, Lender may from time to time issue one
or more letters of credit for the account of Borrower or any affiliates (the
"Letters of Credit"). Borrower's availability on the Revolving Loan will be
reduced by the face amount of all unexpired Letters of Credit. Any fundings
under any Letters of Credit will be treated as an advance on the Revolving Loan
and will be secured by the Security Documents (as defined below). Unless Lender
elects otherwise, Lender shall not be obligated to issue a Letter of Credit if
the aggregate face amount of all outstanding Letters of Credit exceeds
$1,000,000. All Letters of Credit shall be for a term of up to one year (or
longer if necessary for regulatory requirements) but shall expire not later than
five days prior to the Termination Date, unless adequately secured by cash
collateral held by Lender. Borrower will sign and deliver Lender's customary
forms for the issuance of Letters of Credit. Borrower agrees to pay to Lender a
Letter of Credit fee due upon issuance and equal to the greater of (i) $150.00,
or (ii) one and one-half percent (1.5%) per annum, calculated on the aggregated
stated amount of each Letter of Credit for the stated duration thereof (computed
on the basis of actual days elapsed as if each year consisted of 360 days). Any
renewal or extension of a Letter of Credit will be treated as a new issuance for
the purpose of the Letter of Credit fees.

          (d) Borrower agrees to pay to Lender the following fees that are
non-refundable and earned by Lender upon execution of this Loan Agreement unless
otherwise stated:

              (i) Upon execution of this Loan Agreement, Borrower agrees to pay
Lender an Origination Fee in the amount of $25,000; $5,000 of which has been
previously paid to Lender.

              (ii) Borrower agrees to pay to Lender an Unused Fee equal to
one-half of one percent (0.5%) per annum (computed on the basis of actual days
elapsed and as if each calendar year consisted of 360 days) of the average for
the period of calculation of an amount determined daily equal to the difference
between the Borrowing Base and the aggregate outstanding principal balance of
the Revolving Loan at such time. This Unused Fee is payable quarterly within ten
(10) days of Borrower 's receipt of an invoice from Lender, setting forth
evidence of the calculation of the Unused Fee for the preceding calendar
quarter.

          (e) The Revolving Loan, all other loans now or hereafter made by
Lender to Borrower, and any renewals or extensions of or substitutions for those
loans, will be referred to collectively as the "Loans." The Revolving Note, all

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GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
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other promissory notes now or hereafter payable by Borrower to Lender, and any
renewals or extensions of or substitutions for those notes, will be referred to
collectively as the "Notes."

     2. Collateral. (a) Payment of the Notes, all obligations with respect to
Letters of Credit, and all other fees and expenses due pursuant to this Loan
Agreement or the other Loan Documents (as defined below) will be secured by the
first liens and first security interests created or described in the following
(collectively the "Security Documents"): (i) the mortgages and deeds of trust
(collectively the "Deed of Trust") described in Schedule 1 attached, executed by
Gateway Pipeline Company and Gateway Offshore Pipeline Company originally in
favor of WNB, and assigned to Lender by Assignment of Note and Liens of even
date herewith and amended to secure the Notes and Loans; (ii) a Louisiana
Mortgage covering certain assets off-shore of the State of Louisiana; (iii) all
other documents, notices, and financing statements described in Schedule 1
attached, the same having been assigned to Lender by WNB; (iv) a Commercial
Security Agreement (collectively the "Security Agreement") of even date,
executed by Borrower and each Guarantor in favor of Lender, and covering all
personal property of Borrower and each Guarantor; (v) a Pledge and Security
Agreement of even date executed by Borrower in favor of Lender and covering
Borrower's stock in Guarantors; and (vi) any other security documents now or
hereafter executed in connection with the Loans. All pipelines and gathering
systems and all other real and personal property now or hereafter mortgaged to
Lender by Borrower or any of the Guarantors, including the property covered by
the Deed of Trust and the Security Agreement, will be referred to as the
"Properties." If requested by Lender, Borrower will execute in favor of Lender
mortgages, deeds of trust, security agreements, or amendments, in Proper Form
(as defined below), mortgaging any additional midstream oil and gas properties
and all additional interests in the Properties acquired by Borrower.

          (b) Payment of the Notes and all other fees and expenses due pursuant
to this Loan Agreement or the other Loan Documents, also be guaranteed by each
of the Guarantors pursuant to Commercial Guaranties in Proper Form (collectively
the "Guaranties"). The Loans shall also be guaranteed by all existing and
hereafter acquired companies, subsidiaries, or partnerships of Borrower; and
Borrower agrees to cause all such companies, subsidiaries, and partnerships to
execute and deliver guaranties in Proper Form to Lender.

          (c) Borrower shall, upon request of Lender, deliver to Lender title
opinions and/or other title information acceptable to Lender covering the
Properties, consisting of real estate owned by Borrower, along with such other
information regarding title as Lender shall reasonably request, all in Proper
Form, and, in the case of owned real estate, from attorneys or landmen
acceptable to Lender. Lender reserves the right to immediately exclude any
property from the Borrowing Base if Lender learns of any material title issue

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DECEMBER 7, 2009
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with respect to the property or if Lender's review of Borrower's title to the
property indicates that Borrower's title is unacceptable to Lender, in its sole
discretion.

          (d) After an Event of Default (as defined below) that remains uncured
after the expiration of any notice and cure period required by this Loan
Agreement, or if there is an existing Borrowing Base deficiency that is not
addressed by Borrower in accordance with Section 3(b) below, Lender reserves the
right to require Borrower to set up a lockbox account to be managed by Lender
for purposes of collecting pipeline revenues and other accounts receivable and
payment rights (collectively, "Receivables") attributable to Borrower's interest
in the Properties. Borrower agrees that upon Lender's election to require the
lockbox after an Event of Default, Lender will receive Receivables for
application to the Revolving Note; and, in such event, Borrower shall be deemed
to have directed all account debtors and other obligors with respect to the
Receivables to remit all payments in respect thereof directly to Lender, if
Lender so elects. Any Receivables received in the lockbox account by Lender that
are attributable to another person's or entities' interest in the Properties
shall be released immediately to Borrower upon Borrower's request. All other
Receivables received in the lockbox account by Lender in excess of the current
scheduled monthly payment and any other fees or expenses owed to Lender will be
transferred to Borrower at the end of each month for its use consistent with the
provisions of this Loan Agreement, so long as there is no existing Event of
Default. If the Receivables received in the lockbox during any month are not
sufficient to make the scheduled monthly payment, Borrower will pay Lender the
deficiency within ten (10) days.

          (e) Unless a security interest would be prohibited by law or would
render a nontaxable account taxable, Borrower and Guarantors grant to Lender a
contractual possessory security interests in, and hereby assign, pledge, and
transfer to Lender all Borrower's and Guarantor's rights in any deposits or
accounts now or hereafter maintained with Lender (whether checking, savings, or
any other account), excluding, however, accounts maintained by Borrower or any
Guarantors at Lender for the purpose of revenue distribution to third parties
entitled to those revenues and any other accounts held by Borrower or any
Guarantors for the benefit of a third party. Borrower authorizes Lender, to the
extent permitted by applicable law, to charge or setoff any sums owing on the
Loans against any and all such deposits and accounts; and Lender shall be
entitled to exercise the rights of offset and banker's lien against all such
accounts and other property or assets of Borrower or any Guarantors with or in
the possession of Lender to the extent of the full amount of the Loans.

          3. Borrowing Base. (a) On or about December 1st of each year,
commencing December 1, 2010, and at any other time and from time to time while
this Loan Agreement is in force, Lender may determine or redetermine, in its
sole discretion, a Borrowing Base. At any time that Borrower pledges additional
collateral pursuant to a request by Lender under Section 2 above, Borrower may
request in writing a redetermination of the Borrowing Base and Lender will so

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redetermine the Borrowing Base and notify Borrower of the result of the
redetermination within ten (10) days. The term "Borrowing Base" refers to the
designated loan value (as calculated by Lender in its sole discretion) assigned
to the discounted present value of future net income accruing to the Properties
based upon Lender's in-house evaluation. Lender's determination of the Borrowing
Base will use such methodology, assumptions, and discount rates customarily used
by Lender with respect to credits of a similar size and nature in assigning
collateral value to the Properties and will be based upon such other credit
factors or financial information available to Lender at the time of each
determination, including, without limitation, current market conditions and
Borrower's and Guarantors' assets, liabilities, cash flow, liquidity, business,
properties, prospects, management, and ownership. Borrower acknowledges that
increases in the Borrowing Base are subject to appropriate credit approval by
Lender and may be subject to additional terms and conditions.

          (b) The outstanding principal balance owing on the Revolving Note may
not exceed the Borrowing Base at any time, subject to the payout provisions
below in the event of a Borrowing Base decrease. A decrease in the Borrowing
Base will result in an immediate decrease in Lender's commitment under the
Revolving Loan. If the redetermined Borrowing Base is less than the sum of the
outstanding principal then owing on the Revolving Note, Lender will notify
Borrower of the amount of the Borrowing Base and the amount of the deficiency.
Within thirty (30) days after notice is sent by Lender, Borrower shall remedy
the deficiency by either: (i) making a lump sum payment on the Revolving Note to
reduce the principal outstanding to an amount equal to or less than the new
Borrowing Base; or (ii) mortgaging additional collateral, which must be
acceptable to Lender as to type, value, and title.

          (c) At the time of any redetermination, Lender reserves the right to
establish an equal Monthly or Quarterly Commitment Reduction ("MCR") amount by
which the Borrowing Base shall be automatically reduced effective as of each
calendar month or quarter until the next Borrowing Base redetermination.
Lender's determination of the MCR will use such methodology, assumptions, and
discount rates customarily used by Lender with respect to credits of a similar
size and nature in determining commitment reductions and will be based upon such
other credit factors or financial information available to Lender at the time of
each determination, including, without limitation, the value and economic life
of the Properties, and Borrower's assets, liabilities, cash flow, liquidity,
business, properties, prospects, management, and ownership. The MCR will
initially be set at $0. If the outstanding principal balance owing on the
Revolving Note, shall exceed the Borrowing Base solely because of an MCR
reduction, Borrower shall promptly make a single lump sum payment in an amount
sufficient to eliminate such excess so that the outstanding principal balance
does not exceed the Borrowing Base. If the outstanding principal balance owing
on the Revolving Note shall exceed the Borrowing Base because of a Borrowing
Base redetermination (or a Borrowing Base redetermination combined with a
required MCR), Borrower shall have the right to cure set forth in subsection (b)

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above; provided, however, that if the MCR was applicable before the Borrowing
Base redetermination, then the MCR amount will be due in a lump sum and Lender
may continue the MCR at the same amount or change the MCR effective on the
redetermination date.

     4. Conditions  Precedent.  (a) The obligation of Lender to make the initial
advance on the Revolving Loan is subject to Borrower's satisfaction, in Lender's
sole discretion, of the following conditions precedent:

              (1) Lender's receipt and satisfactory review by Lender of the 2008
fiscal year-end and September 30, 2009 year-to-date financial statements of
Borrower, including a balance sheet, an income statement, and a cash flow
statement, prepared in conformity with generally accepted accounting principles,
consistently applied ("Accounting Principles").

              (2) Borrower shall be in compliance in all material respects with
all existing obligations, there shall be no default at closing, and all
representations and warranties in connection with existing obligations must be
true in all material respects.

              (3) the negotiation, execution, and delivery of Loan Documents in
Proper Form, including, but not limited to, the following:

                  (i)     this Loan Agreement;
                  (ii)    the Revolving Note;
                  (iii)   the Assignment of Note and Liens;
                  (iv)    the Security Documents;
                  (v)     the Guaranties;
                  (vi)    Borrowing Resolution; and
                  (vii)   Guarantor Resolutions.

              (4) satisfactory evidence that Lender holds perfected liens and
security interests in all collateral for the Loans, subject to no other liens or
security interests other than Permitted Liens (as defined below).

              (5) there shall not have occurred any result, occurrence,
condition, change, fact, event, circumstance, or effect that, individually or in
the aggregate, has caused or would reasonably be expected to cause a material
adverse change on (i) the financial condition, business, assets, properties,
liabilities (actual and contingent), operations or results of operations of
Borrower and Guarantors as a whole, (ii) the ability of Borrower or any
Guarantors to own their assets and conduct business in the ordinary course as
presently owned and conducted, or (iii) the ability of Borrower or any
Guarantors to perform their obligations under or consummate the transactions
contemplated by the Loan Documents (collectively "Material Adverse Change").

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               (6) there being no order or injunction or other pending or
threatened litigation in which there is a reasonable possibility, in Lender's
judgment, of a decision which could materially adversely affect the ability of
Borrower to perform under the Loan Documents.

               (7) Lender shall have completed and approved a review of title
to, and the status of the environmental condition of, Borrower's properties,
including the Borrowing Base properties, and the results of such review shall be
acceptable to Lender in its sole discretion.

               (8) Lender's receipt and review, with results satisfactory to
Lender and its counsel, of information regarding litigation, tax, accounting,
insurance, pension liabilities (actual or contingent), real estate leases,
material contracts, debt agreements, property ownership, and contingent
liabilities of Borrower.

               (9) Lender's receipt of satisfactory evidence that Borrower has
no outstanding indebtedness other than the Revolving Loan, trade accounts
payable, taxes incurred in the ordinary course of business, and any other
indebtedness permitted pursuant to the terms of this Loan Agreement.

               (10) Borrower's establishment of an operating account with
Lender.

               (11) Lender's receipt of evidence that Borrower has received an
certificate of authority from the State of Texas and is authorized to do
business in the State of Texas.

          (b) Lender will not be obligated to make the Loans or any subsequent
advance on the Loans, if, prior to the time that a loan or advance is made, (i)
there has been any Material Adverse Change, (ii) any representation or warranty
made by Borrower in this Loan Agreement or the other Loan Documents is untrue or
incorrect in any material respect as of the date of the advance or loan, (iii)
Lender has not received all Loan Documents appropriately executed by Borrower,
Guarantors, and all other proper parties, (iv) Lender has requested that
Borrower or Guarantors execute additional loan or security documents consistent
with the terms of this Agreement and those documents have not yet been properly
executed, delivered, and recorded, (v) Borrower is not in compliance with the
Borrowing Base and all reporting requirements, or (vi) an Event of Default (as
defined below) has occurred and is continuing.

     5. Representations and Warranties. (a) Borrower hereby represents and
warrants to Lender as follows:

               (1) The execution, delivery, and performance of this Loan
Agreement, the Notes, the Security Documents, and all of the other Loan
Documents by Borrower, or any subsidiary of Borrower, have been duly authorized

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by Borrower board of directors, and this Loan Agreement, the Notes, the Security
Documents, and all of the other Loan Documents constitute legal, valid, and
binding obligations of Borrower, enforceable in accordance with their respective
terms;

               (2) The execution, delivery, and performance of this Loan
Agreement, the Notes, the Security Documents, and the other Loan Documents, and
the consummation of the transaction contemplated, do not require the consent,
approval, or authorization of any third party and do not and will not conflict
with, result in a violation of, or constitute a default under (i) any provision
of Borrower's Bylaws or any other agreement or instrument binding upon Borrower
or (ii) any law, governmental regulation, court decree, or order applicable to
Borrower;

               (3) Each financial statement of Borrower, now or hereafter
supplied to Lender, was (or will be) prepared in accordance with Accounting
Principles, in Proper Form, and truly discloses and fairly presents in all
material respects Borrower's financial condition as of the date of each such
statement, and there has been no Material Adverse Change subsequent to the date
of the most recent financial statement supplied to Lender;

               (4) There are no actions, suits, or proceedings pending or, to
Borrower's or Guarantors' knowledge, threatened against or affecting Borrower,
Guarantors, or the Properties, before any court or governmental department,
commission, or board, which, if determined adversely, would reasonably be
expected to cause a Material Adverse Change;

               (5) Borrower has filed all federal, state, and local tax reports
and returns required by any law or regulation to be filed and has either duly
paid all taxes, duties, and charges indicated due on the basis of such returns
and reports, or made adequate provision for the payment thereof, and the
assessment of any material amount of additional taxes in excess of those paid
and reported is not reasonably expected;

               (6) Borrower is in compliance in all material respects with all
applicable provisions of the Employee Retirement Income Security Act of 1974, as
amended or recodified from time to time ("ERISA"); Borrower has not violated any
provision of any "defined benefit plan" (as defined in ERISA) maintained or
contributed to by Borrower (each a "Plan"); no "Reportable Event" as defined in
ERISA has occurred and is continuing with respect to any Plan initiated by
Borrower, unless the reporting requirements have been waived by the Pension
Benefit Guaranty Corporation; and Borrower has met its minimum funding
requirements under ERISA with respect to each Plan;

               (7) Borrower has disclosed to Lender all agreements, or accurate
examples thereof, materially affecting Borrower's properties and its operations,
and Borrower covenants to provide such additional information as Lender may

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reasonably request from time to time regarding Borrower or its properties,
including without limitation, gas transportation agreements and advance payment
contracts;

               (8) Borrower certifies that Schedule 2 sets forth, as of the date
of this Loan Agreement, a true and correct organizational chart and list of all
subsidiaries or other entities owned by Borrower indicating the ownership in
each; and

               (9) As of the date of this Loan Agreement, Borrower has entered
into no existing ISDA Agreements or hedge transactions with any parties.

          (b) Guarantors hereby represent and warrant as follows:

               (1) The execution, delivery, and performance of this Loan
Agreement, the Guaranties, and all of the other Loan Documents have been duly
authorized by each Guarantor's board of directors; and this Loan Agreement, the
Guaranties, and all other Loan Documents constitute legal, valid, and binding
obligations of that entity, enforceable in accordance with their respective
terms;

               (2) Each financial statement of Guarantors, now or hereafter
supplied to Lender, was (or will be) prepared in accordance with Accounting
Principles, in Proper Form, and truly discloses and fairly presents each
Guarantors' financial condition as of the date of each such statement, and there
has been no Material Adverse Change subsequent to the date of the most recent
financial statement supplied to Lender;

               (3) There are no actions, suits, or proceedings pending or
threatened against or affecting Guarantors, before any court or governmental
department, commission, or board, which, if determined adversely, would
reasonable be expected to cause a Material Adverse Change; and

               (4) Guarantors have filed all federal, state, and local tax
reports and returns required by any law or regulation to be filed and have
either duly paid all taxes, duties, and charges indicated due on the basis of
such returns and reports, or made adequate provision for the payment thereof,
and the assessment of any material amount of additional taxes in excess of those
paid and reported is not reasonably expected.

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     6. Covenants. (a) Until the Loans and all other obligations and liabilities
of Borrower under this Loan Agreement, the Notes, the Security Documents, and
the other Loan Documents are fully paid and satisfied, Borrower shall, unless
Lender otherwise consents in writing:

               (1) (i) Maintain its existence in good standing in the state of
its formation, maintain its authority to do business in Texas and all other
states in which it is required to qualify, and maintain full legal capacity to
perform all its obligations under this Loan Agreement and the Loan Documents,
(ii) continue to operate its business as presently conducted or as may be
reasonably related or incidental thereto, (iii) not permit a material change in
its ownership, control, or management, (iv) not permit its dissolution,
liquidation, or other termination of existence or forfeiture of right to do
business, (v) not form any subsidiary without notifying Lender in writing at
least ten (10) days in advance, (vi) not permit a merger or consolidation
(unless Borrower is the surviving entity), and (vii) not acquire all or
substantially all of the assets of any other entity without first notifying
Lender in writing at least ten (10) days in advance.

               (2) Manage the Properties in an orderly and efficient manner
consistent with good business practices, and perform and comply in all material
respects with all statutes, rules, regulations, and ordinances imposed by any
governmental unit upon the Properties or Borrower and its operations including,
without limitation, compliance with all applicable laws relating to the
environment.

               (3) Maintain insurance as customary in the industry or as
reasonably required by Lender, including but not limited to, casualty,
comprehensive property damage, and commercial general liability, and other
insurance, including worker's compensation (if necessary to comply with law),
naming Lender as an additional insured or a loss payee, and containing
provisions prohibiting their cancellation without prior written notice to
Lender, and provide Lender with evidence of the continual coverage of those
policies prior to the lapse of any policy, (it being understood, however, that
Borrower does not currently insure and need not hereafter insure its pipeline
assets against property damage or similar casualty).

               (4) Not sell, assign, transfer, or otherwise dispose of all or
any interest in the Properties or any other collateral, except for (i) the
purchase and sale of hydrocarbons in the ordinary course of business (provided,
however, that Borrower may not enter into any contract for the purchase of
hydrocarbons without entering into a corresponding contract for the sale of the
entirety of the volumes to be purchased) or (ii) the sale or transfer of
equipment that is no longer necessary for the business of Borrower or that is
replaced by equipment of at least comparable value and use.

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               (5) Promptly inform Lender of (i) any Material Adverse Change,
(ii) all litigation and claims which could reasonably be expected to materially
and adversely affect the financial condition of Borrower or the Properties,
(iii) all actual or contingent material liabilities of Borrower, (iv) any change
in name, identity, or structure of Borrower, and (v) any uninsured or partially
insured loss of any collateral through fire, theft, liability, or property
damage.

               (6) Maintain Borrower's books and records in accordance with
Accounting Principles, and permit Lender to examine, audit, and make and take
away copies or reproductions of Borrower's books and records, reasonably
required by Lender, at all reasonable times; and permit such persons as Lender
may designate at reasonable times to visit and inspect the Properties and
examine all records with respect to the Properties; and pay for the reasonable
cost of such examinations, audits, and inspections required by Lender.

               (7) Pay and discharge when due all indebtedness and obligations,
including without limitation, all assessments, taxes, governmental charges,
levies, and liens, of every kind and nature, imposed upon Borrower or the
Properties, prior to the date on which penalties would attach, and all lawful
claims that, if unpaid, might become a lien or charge upon the Properties,
income, or profits, and pay all trade payables and other current liabilities
incurred in the ordinary course of business within ninety (90) days of their due
date; provided, however, Borrower will not be required to pay and discharge any
such assessment, tax, charge, levy, lien, or claim so long as (i) the legality
of the same shall be contested in good faith by appropriate judicial,
administrative, or other legal proceedings, and (ii) Borrower has established
adequate reserves with respect to such contested assessment, tax, charge, levy,
lien, or claim in accordance with Accounting Principles.

               (8) Not directly or indirectly create, incur, assume, or permit
to exist any indebtedness (including guaranties), secured or unsecured, absolute
or contingent, except for the following (the "Permitted Indebtedness"): (i) the
indebtedness to Lender, (ii) any trade payables, taxes, and current liabilities
incurred in the ordinary course of business, (iii) the existing indebtedness
disclosed in Schedule 3 attached, and (iv) purchase-money indebtedness
(including, without limitation, capital lease obligations) secured by
purchase-money liens permitted under clause (vi) of Section 6(a)(9) of this Loan
Agreement; and not make capital expenditures, other than capital expenditures
financed by proceeds of the Loans, in excess of $500,000 during any fiscal year
of Borrower.

               (9) Not mortgage, assign, hypothecate, pledge, or encumber, and
not create, incur, or assume any lien or security interest on or in, the
Properties (or any interest in the Properties), including, without limitation,
any oil and gas properties included in the calculation of the Borrowing Base,
except the following (collectively the "Permitted Liens"): (i) those in favor of

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DECEMBER 7, 2009
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Lender, (ii) those existing and disclosed to Lender in writing (including,
without limitation, the cash collateral posted by the Borrower to WNB to secure
Borrower's reimbursement obligations with respect to the letters of credit
described in Schedule 3 attached hereto), (iii) liens for taxes not delinquent
or being contested in good faith, (iv) landlord's liens, vendors', carriers',
warehousemen's, repairmen's, mechanics', suppliers', workers', materialmen's,
construction, or other like liens with respect to obligations not overdue or
being contested in good faith, (v) liens resulting from deposits to secure the
payments of workers' compensation or social security, (vi) purchase money
security interests, capital leases, or construction liens that attach solely to
the asset acquired, leased, or constructed, that secure indebtedness in an
amount not exceeding the cost and the fair market value of the asset acquired or
constructed, and (vii) contractual liens that arise in the ordinary course of
business under or in connection with operating agreements, oil and gas leases,
farm-out agreements, contracts for the sale, transportation, or exchange of oil
and natural gas, unitization and pooling declarations and agreements, area of
mutual interest agreements, marketing agreements, processing agreements,
development agreements, gas balancing or deferred production agreements,
injection, repressuring, and recycling agreements, salt water or other disposal
agreements, seismic or other geophysical permits or agreements, and other
agreements which are usual and customary in the oil and gas business and are for
claims which are not delinquent or which are being contested in good faith.

               (10) Not make any loans, advances, dividends, or other
distributions to any party, including without limitation, shareholders,
officers, directors, partners, joint venturers, members, managers, relatives, or
affiliates, or any profit sharing or retirement plan, except for (i) loans or
advances to employees of the Borrower for payment of expenses incurred in the
ordinary course of business, (ii) loans or advances by the Borrower to one or
more Guarantors, provided that no Event of Default exists at the time of such
loan or advance, (iii) loans or advances by the Borrower to entities (other than
Guarantors) owned in whole or in party by the Borrower or a Guarantor, provided
that no Event of Default exists at the time of such loan or advance and provided
that the aggregate outstanding amount of all loans and advances pursuant to this
clause (iii) does not exceed $100,000 at any time, (iv) payments to any profit
sharing or retirement plans of the Borrower in existence on the date of this
Loan Agreement, provided that the amount of such payments is consistent with the
Borrower's past payments, (v) distributions by the Borrower to its equity
holders payable solely in stock or other equity interests of the Borrower, and
(vi) such other loans, advances, dividends, distributions or amounts as Lender
shall hereafter approve in writing.

               (11) Not purchase, acquire, redeem, or retire any stock or other
ownership interest in Borrower; and not permit any transaction or contract with
any affiliates or related parties (other than, so long as no Event of Default
exists, Guarantors), except at arms length and on market terms.

<PAGE>

GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
Page 13 of 29

               (12) Maintain its primary depository accounts and principal
banking relationship at Lender.

               (13) INDEMNIFY LENDER AGAINST ALL LOSSES, LIABILITIES,
WITHHOLDING AND OTHER TAXES, CLAIMS, DAMAGES, OR EXPENSES RELATING TO THE LOANS,
THE LOAN DOCUMENTS, OR BORROWER'S USE OF THE LOAN PROCEEDS, INCLUDING BUT NOT
LIMITED TO ATTORNEYS AND OTHER PROFESSIONAL FEES AND SETTLEMENT COSTS, BUT
EXCLUDING, HOWEVER, THOSE CAUSED SOLELY BY OR RESULTING SOLELY FROM ANY GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT BY LENDER; AND THIS INDEMNITY SHALL SURVIVE THE
TERMINATION OF THIS LOAN AGREEMENT.

               (14) Comply in all material respects with all applicable
provisions of ERISA, not violate any provision of any Plan, meet its minimum
funding requirements under ERISA with respect to each Plan, and notify Lender in
writing of the occurrence and nature of any Reportable Event or Prohibited
Transaction, each as defined in ERISA, or any funding deficiency with respect to
any Plan.

               (15) If Borrower now or hereafter acquires any wholly-owned
subsidiary or owns any issued and outstanding capital stock or partnership
interests of any companies or partnerships, Borrower shall sign and deliver to
Lender within fifteen (15) days a pledge agreement in Proper Form, creating a
first-priority security interest covering the issued and outstanding capital
stock or partnership interests of all existing and hereafter acquired companies,
subsidiaries, or partnerships of Borrower, and Borrower shall cause the
wholly-owned subsidiary to sign and deliver to Lender within fifteen (15) days a
guaranty in Proper Form, guaranteeing payment of the Loans and all other fees
and expenses due pursuant to this Loan Agreement or the other Loan Documents.

               (16) Execute and deliver, or cause to be executed and delivered,
within ten (10) days of Lender's written request, any and all other agreements,
instruments, or documents which Lender may reasonably request in order to give
effect to the transactions contemplated under this Loan Agreement and the Loan
Documents, and to grant, perfect, and maintain liens and security interests on
or in the Properties and related collateral, and promptly cure any defects in
the execution and delivery of any Loan Documents.

          (b) Until the Loans and all other obligations and liabilities of
Guarantors under this Loan Agreement, the Guaranties, and the other Loan
Documents are fully paid and satisfied, Guarantors agree and covenant that they
will, unless Lender otherwise consents in writing:

<PAGE>

GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
Page 14 of 29

               (1) Not sell, transfer, pledge, encumber, or otherwise dispose of
all or any interest in Borrower;

               (2) Promptly inform Lender of (i) any Material Adverse Change,
(ii) all litigation and claims which could materially affect the financial
condition of any Guarantors, and (iii) all actual or contingent material
liabilities; and

               (3) Execute and deliver, or cause to be executed and delivered,
any and all other agreements, instruments, or documents which Lender may
reasonably request in order to give effect to the transactions contemplated
under this Loan Agreement and the Loan Documents, and promptly cure any defects
in the execution and delivery of any Loan Documents.

     7. Financial Covenants. Until the Loans and all other obligations and
liabilities of Borrower under this Loan Agreement, the Notes, the Security
Documents, and the other Loan Documents are fully paid and satisfied, Borrower
shall, unless Lender otherwise consents in writing, maintain the following
financial covenants:

          (a) Maintain at the end of each fiscal quarter a Current Ratio greater
than or equal to 1.25 to 1.0. "Current Ratio" is defined as the ratio of (i)
current assets of Borrower and its subsidiaries on a consolidated basis, plus
until the Termination Date, amounts remaining to be advanced on the Revolving
Loan as limited under Subsection (a) of Section 1 of this Loan Agreement,
divided by (ii) current liabilities (excluding current maturities of long-term
debt) of Borrower and its subsidiaries on a consolidated basis.

          (b) Maintain a Debt to Tangible Net Worth Ratio less than or equal to
0.5 to 1.0 as of the end of each fiscal quarter. "Debt to Tangible Net Worth
Ratio" is defined as the ratio of (i) the total amount outstanding on the Loans,
divided by (ii) the total value of Borrower's and its subsidiaries' assets, less
the value of Borrower's and its subsidiaries' intangible assets, less the total
amount of Borrower's and its consolidated subsidiaries liabilities.

          (c) Maintain at the end of each fiscal quarter a Debt Service Coverage
Ratio greater than or equal to 1.5 to 1.0. "Debt Service Coverage Ratio" is
defined as the ratio of (i) EBITDA for Borrower and its subsidiaries on a
consolidated basis for the most recent quarter, divided by (ii) interest expense
on the Loans for the quarter, plus actual principal and interest payments on any
other indebtedness of Borrower and its subsidiaries for the most recent fiscal
quarter. "EBITDA" means, for any period, the pre-tax net income of the Borrower
and its consolidated subsidiaries for such period, plus (without duplication and
only to the extent deducted in determining such net income) interest expense of
the Borrower and its consolidated subsidiaries for such period, depreciation,
non-cash amortization, depletion, write down of assets and other non-cash
expenses of the Borrower and its consolidated subsidiaries for such period, plus

<PAGE>

GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
Page 15 of 29

or minus, as the case may be, nonrecurring losses or gains resulting from the
sale of assets during such period (to the extent such losses or gains are
included in the determination of such net income).

Unless otherwise specified, all accounting and financial terms and covenants set
forth above are to be determined according to Accounting Principles,
consistently applied.

     8. Reporting Requirements. Until the Loans and all other obligations and
liabilities of Borrower under this Loan Agreement, the Notes, the Security
Documents, and the other Loan Documents are fully paid and satisfied, Borrower
shall, unless Lender otherwise consents in writing, furnish to Lender in Proper
Form:

               (1) As soon as available, and in any event within ninety (90)
days of the end of Borrower's fiscal year, annual financial statements for
Borrower, consisting of at least a balance sheet, an income statement, a
statement of cash flows, a statement of operations, and a statement of changes
in owners' equity, audited by an independent certified public accountant
acceptable to Lender and certified by an authorized officer of Borrower (i) as
being true and correct in all material aspects to the best of his knowledge,
(ii) as fairly reporting the financial condition of Borrower as of the close of
the fiscal year and the results of its operations for the year, and (iii) as
having been prepared in accordance with Accounting Principles;

               (2) As soon as available, and in any event within sixty (60) days
of the end of each fiscal quarter, quarterly financial statements for Borrower,
consisting of at least a balance sheet, an income statement, a statement of cash
flows, a statement of operations, and a statement of changes in owners' equity,
for the quarter and for the period from the beginning of the fiscal year to the
close of the quarter, certified by an authorized officer of Borrower (i) as
being true and correct in all material aspects to the best of his knowledge,
(ii) as fairly reporting the financial condition of Borrower as of the close of
the fiscal quarter and the results of its operations for the quarter, and (iii)
as having been prepared in accordance with Accounting Principles;

               (3) With the quarterly and annual financial statements required
above, a quarterly compliance certificate in the form of Exhibit B attached,
signed by an authorized officer of Borrower and certifying compliance with the
financial covenants and other matters in this Loan Agreement;

               (4) On an annual basis, a throughput study of the Borrower's
pipeline assets and other Properties, as follows: Lender reserves the right to
require a third-party throughput study, however, in lieu of this, at least

<PAGE>

GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
Page 16 of 29

annually, the Lender may conduct its own throughput study at a cost to the
Borrower not to exceed $3,000;

               (5) Within thirty (30) days of filing, copies of Borrower's
federal, state, and local income tax filings or returns, with all schedules,
attachments, forms, and exhibits;

               (6) Within forty-five (45) days of the end of each quarter,
quarterly volume reports for the Properties;

               (7) Within three (3) days filing, Borrower shall provide to
Lender full and complete copies of all 10K and 10Q filings made by Borrower or
any of its subsidiaries;

               (8) At any time upon request by Lender and within thirty (30)
days of any change thereafter, a list showing the name and address of each
purchaser of oil, gas, and associated hydrocarbons produced from or attributable
to the Properties;

               (9) Within five (5) days after Borrower learns of any such
occurrence, a written report of any pending or threatened litigation which would
reasonably be expected to cause a Material Adverse Change or which asserts
damages or claims in an amount in excess of $100,000;

               (10) As soon as possible and in any event within five (5) days
after the occurrence of any Event of Default, or any event which, with the
giving of notice or lapse of time or both, would constitute an Event of Default,
the written statement of Borrower setting forth the details of such Event of
Default and the action which Borrower proposes to take with respect thereto; and

               (11) Within ten (10) days of Lender's written request, such other
information respecting the condition and the operations, financial or otherwise,
of Borrower and the Properties as Lender may from time to time reasonably
request.

          (b) Until the Loans and all other obligations and liabilities of
Guarantors under this Loan Agreement, the Guaranties, and the other Loan
Documents are fully paid and satisfied, each of the Guarantors shall, within ten
(10) days of Lender's written request, furnish Lender information respecting the
condition and the operations, financial or otherwise, of each of the Guarantors
as Lender may from time to time reasonably request.

<PAGE>

GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
Page 17 of 29

     9. Events of Default. (a) The occurrence at any time of any of the
following events or the existence of any of the following conditions shall be
called an "Event of Default":

               (1) Failure to make punctual payment when due of any sums owing
on any of the Notes or any of the other secured indebtedness (as described in
the Deed of Trust or the Security Agreement) or any other amounts owed by
Borrower to Lender; or

               (2) Failure of any of the Obligated Parties (as defined below) to
properly perform any of the obligations, covenants, or agreements, contained in
this Loan Agreement or any of the other Loan Documents; or any representation or
warranty made by Borrower or Guarantors proves to have been false, misleading,
or erroneous in any material respect; or

               (3) If Receivables attributable to Borrower's properties are
directed to any party other than the lockbox maintained by Lender following the
establishment of the lockbox under Section 2(d) of this Loan Agreement; or

               (4) A failure by Borrower to resolve a Borrowing Base deficiency
in accordance with Section 3(b) of this Loan Agreement; or

               (5) Levy, execution, attachment, sequestra-tion, or other writ
against any real or personal property, representing the security for the Loans
(it being understood that the incurrence of a Permitted Lien shall not
constitute an Event of Default under this clause (5)); or

               (6) Any "Event of Default" under the Notes or any of the other
Loan Documents, the Events of Default defined in the Notes and Loan Documents
being cumulative to those contained in this Loan Agreement; or

               (7) Except as expressly permitted by this Loan Agreement, the
transfer, whether voluntarily or by operation of law, of all or any portion of
the Properties without obtaining Lender's consent; or

               (8) The failure of any of the Obligated Parties to pay any money
judgment in excess of $25,000.00, against that party before the expiration of
thirty (30) days after the judgment becomes final, or the failure of any of the
Obligated Parties to obtain dismissal within ninety (90) days of any involuntary
proceeding filed against that party under any Debtor Relief Laws (as defined
below); or

               (9) Borrower's liquidation, termination of existence, merger or
consolidation with another (unless Borrower is the surviving entity), forfeiture
of right to do business (except as otherwise permitted under this Loan

<PAGE>

GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
Page 18 of 29

Agreement), or appointment of a trustee or receiver for any part of its property
or the filing of an action seeking to appoint a trustee or receiver (except, in
the case of an involuntary filing, if such action is dismissed within 90 days,
unless prior thereto an order for relief is entered); or

               (10) A filing by any of the Obligated Parties of a voluntary
petition in bankruptcy, or taking advantage of any Debtor Relief Laws; or an
answer admitting the material allegations of a petition filed against any of the
Obligated Parties, under any Debtor Relief Laws; or an admission by any of the
Obligated Parties in writing of an inability to pay its or their debts as they
become due; or the calling of any meeting of creditors of any of the Obli-gated
Parties under any Debtor Relief Laws, for the purpose of considering an
arrangement or composition; or

               (11) Any of the Obligated Parties revokes or disputes the
validity of or liability under any of the Loan Documents, including any guaranty
or security document.

          (b) The term "Obligated Parties" means Borrower, Guarantors, any other
party liable, in whole or in part, for the payment of any of the Notes, whether
as maker, endorser, guaran-tor, surety, or otherwise, and any party executing
any deed of trust, mortgage, security agreement, pledge agreement, assignment,
or other contract of any kind executed as securi-ty in connection with or
pertaining to the Notes or the Loans. The term "Debtor Relief Laws" means any
applicable liquidation, conservatorship, receivership, bankruptcy, morato-rium,
rearrangement, insolvency, reorganization, or similar laws affecting the rights
or remedies of creditors generally, as in effect from time to time.

     10. Remedies. (a) Upon the occurrence and during the continuance of any one
or more of the foregoing Events of Default and the expiration of any notice,
cure, or grace period required by subsection (b) below, the entire unpaid
principal balances of the Notes, together with all accrued but unpaid interest
thereon, and all other indebtedness then owing by Borrower to Lender, shall, at
the option of Lender, become immediately due and payable without further
presentation, demand for payment, notice of intent to accelerate, notice of
acceleration or dishonor, protest or notice of protest of any kind, all of which
are expressly waived by Borrower. Any and all rights and remedies of Lender
pursuant to this Loan Agreement or any of the other Loan Documents may be
exercised by Lender, at its option, upon the occurrence and during the
continuance of an Event of Default and the expiration of any notice, cure, or
grace period required by subsection (b) below. All remedies of Lender may be
exercised singularly, concurrently, or consecutively, without waiver or
election.

          (b) Upon any Event of Default described in Subsection 9 (a)(1) above
regarding payment of sums owing to Lender, Lender shall provide Borrower with an
invoice for the payment due and Borrower shall have five (5) days grace after
the due date in order to cure the default prior to acceleration of the Notes and

<PAGE>

GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
Page 19 of 29

exercise of any remedies. Upon any other Event of Default described in
Subsection 9 (a) above, Lender shall provide Borrower with written notice of the
Event of Default and Borrower shall have twenty (20) days after notice in order
to cure the Event of Default prior to acceleration of the Notes and exercise of
any remedies; except Borrower shall have no cure period for any voluntary filing
by Borrower under any Debtor Relief Laws, for any voluntary transfer of any
portion of the Properties in violation of this Agreement, without obtaining
Lender's partial release, for any liquidation or termination of existence of
Borrower, or for any Event of Default that is not capable of cure during that
period, including, without limitation, breaches of any negative covenants that
are not capable of cure during that period, and provided that Lender is not
obligated to provide written notice of any Event of Default which Borrower
reports to Lender, but Borrower shall have the benefit of any applicable grace
or cure period required herein.

          (c) All rights of Lender under the terms of this Loan Agreement shall
be cumulative of, and in addition to, the rights of Lender under any and all
other agreements between Borrower and Lender (including, but not limited to, the
other Loan Documents), and not in substitution or diminution of any rights now
or hereafter held by Lender under the terms of any other agreement.

     11. Waiver and Amendment. Neither the failure nor any delay on the part of
Lender to exercise any right, power, or privilege herein or under any of the
other Loan Documents shall operate as a waiver thereof, nor shall any single or
partial exercise of such right, power, or privilege preclude any other or
further exercise thereof or the exercise of any other right, power, or
privilege. No waiver of any provision in this Loan Agreement or in any of the
other Loan Documents and no departure by Borrower therefrom shall be effective
unless the same shall be in writing and signed by Lender, and then shall be
effective only in the specific instance and for the purpose for which given and
to the extent specified in such writing. No modification or amendment to this
Loan Agreement or to any of the other Loan Documents shall be valid or effective
unless the same is signed by the party against whom it is sought to be enforced.

     12. Savings Clause. Regardless of any provision contained in this Loan
Agreement, the Notes, or any of the Loan Documents, it is the express intent of
the parties that at no time shall Borrower or any of the Obligated Parties pay
interest in excess of the Maximum Rate (or any other interest amount which might
in any way be deemed usurious), and Lender will never be considered to have
contracted for or to be entitled to charge, receive, collect, or apply as
interest on any of the Notes, any amount in excess of the Maximum Rate (or any
other interest amount which might in any way be deemed usurious). In the event
that Lender ever receives, collects, or applies as interest any such excess, the
amount which would be excessive interest will be applied to the reduction of the
principal balances of the Notes, and, if the principal balances of the Notes are
paid in full, any remaining excess shall forthwith be paid to Borrower. In

<PAGE>

GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
Page 20 of 29

determining whether the interest paid or payable exceeds the Maximum Rate (or
any other interest amount which might in any way be deemed usurious), Borrower
and Lender shall, to the maximum extent permitted under applicable law: (i)
characterize any non-principal payment (other than payments which are expressly
designated as interest payments hereunder) as an expense or fee rather than as
interest; (ii) exclude voluntary prepayments and the effect thereof; and (iii)
amortize, pro rate, or spread the total amount of interest throughout the entire
contemplated term of the Notes so that the interest rate is uniform throughout
the term. The term "Maximum Rate" means the maximum interest rate which may be
lawfully charged under applicable law.

     13. Notices. Any notice or other communications provided for in this Loan
Agreement shall be in writing and shall be given to the party at the address
shown below:

     Lender:         MERIDIAN BANK TEXAS
                     Attention:   John Van Son, Senior Vice President
                     100 Lexington Street, Ste. 100,
                     Fort Worth, Texas 76102
                     Fax Number (817) 810-0272

     With a copy
     to counsel
     for Lender:     Wade D. Purtell
                     HARRIS, FINLEY & BOGLE, P.C.
                     777 Main Street, Suite 3600
                     Fort Worth, Texas  76102-5341
                     Fax Number (817) 332-6121

     Borrower and
     Guarantors:     GATEWAY ENERGY CORPORATION
                     Attention: Chris Rasmussen, CFO
                     1415 Louisiana Street, Ste. 4100
                     Houston, Texas 77002
                     Fax Number (713) 336-0855

<PAGE>

GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
Page 21 of 29

     With a copy
     to counsel
    for Borrower:    Craig Evans
                     STINSON MORRISON HECKEr, LLP
                     1201 Walnut Street, Suite 2900
                     Kansas City, Missouri 64106
                     Fax Number (816) 691-3495

Any such notice or other communication shall be deemed to have been given on the
day it is personally delivered or, if mailed, on the third day after it is
deposited in an official receptacle for the United States mail, or, if faxed, on
the date it is received by the party. Any party may change its address for the
purposes of this Loan Agreement by giving notice of such change in accordance
with this paragraph.

     14. Miscellaneous. (a) This Loan Agreement shall be binding upon and inure
to the benefit of Lender, Borrower, and Guarantors, and their respective heirs,
personal representatives, successors, and assigns; provided, however, that
Borrower and Guarantors may not, without the prior written consent of Lender,
assign any rights, powers, duties, or obligations under this Loan Agreement or
any of the other Loan Documents.

          (b) THIS LOAN AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND THE APPLICABLE LAWS OF THE
UNITED STATES OF AMERICA AND SHALL BE PERFORMED IN TARRANT COUNTY, TEXAS.
BORROWER, GUARANTORS, AND LENDER IRREVOCABLY AGREE THAT VENUE FOR ANY ACTION OR
CLAIM RELATED TO THIS LOAN AGREEMENT, THE NOTES, THE LOANS, THE GUARANTIES, OR
THE PROPERTIES SHALL BE IN COURT IN TARRANT COUNTY, TEXAS.

          (c) If any provision of this Loan Agreement or any other Loan
Documents is held to be illegal, invalid, or unenforceable under present or
future laws, such provision shall be fully severable and the remaining
provisions of this Loan Agreement or any of the other Loan Documents shall
remain in full force and effect and shall not be affected by the illegal,
invalid, or unenforceable provision or by its severance.

          (d) All covenants, agreements, undertakings, representations, and
warranties made in this Loan Agreement and the other Loan Documents shall
survive any closing hereunder.

          (e) All documents delivered by Borrower or Guarantors to Lender must
be in Proper Form. The term "Proper Form" means in form, substance, and detail
satisfactory to Lender in its sole discretion.; provided, however, that with
respect to Reporting Requirements under Section 8 "Proper Form" means in form,
substance, and detail satisfactory to Lender in its reasonable discretion.

          (f) Without limiting the effect of any provision of any Loan Document
which provides for the payment of expenses and attorneys fees upon the
occurrence of certain events, Borrower shall pay all costs and expenses
(including, without limitation, the reasonable attorneys fees of Lender's

<PAGE>

GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
Page 22 of 29

inside or independent legal counsel) in connection with (i) the preparation of
this Loan Agreement and the other Loan Documents, and any and all extensions,
renewals, amendments, supplements, extensions, or modifications thereof, (ii)
any action reasonably required in the course of administration of the Loans,
(iii) resolution of any disputes with Borrower or Guarantors related to the
Loans or this Loan Agreement, and (iv) any action in the enforcement of Lender'
s rights upon the occurrence of an Event of Default.

          (g) If there is a conflict between the terms of this Loan Agreement
and the terms of any of the other Loan Documents, the terms of this Loan
Agreement will control.

          (h) Lender shall have the right, with the consent of Borrower (unless
an Event of Default has occurred and is continuing, in which case no consent is
needed), which will not be unreasonably withheld, (i) to assign the Loans or
commitment and be released from liability thereunder, and (ii) to transfer or
sell participations in the Loans or commitment with the transferability of
voting rights limited to principal, rate, fees, and term.

          (i) This Loan Agreement may be separately executed in any number of
counterparts, each of which will be an original, but all of which, taken
together, shall be deemed to constitute one agreement, and Lender is authorized
to attach the signature pages from the counterparts to copies for Lender and
Borrower. At Lender's option, this Loan Agreement and the Loan Documents may
also be executed by Borrower and Guarantors in remote locations with signature
pages faxed to Lender. Borrower and Guarantors agree that the faxed signatures
are binding upon Borrower and Guarantors, and Borrower and Guarantors further
agree to promptly deliver the original signatures for this Loan Agreement and
all Loan Documents by overnight mail or expedited delivery. It will be an Event
of Default if they fail to promptly deliver all required original signatures.

     15. WNB Assigned Credit Agreement. This Loan Agreement replaces the Credit
Agreement, dated August 23, 2007, among Borrower, as borrower thereunder, and
Western National Bank, as Administrative Agent and a Lender thereunder, as
amended and as assigned by Western National Bank to Lender, provided that this
Loan Agreement shall not act as a novation or discharge of any indebtedness
outstanding under such Credit Agreement that has been assigned by Western
National Bank to Lender or act to discharge limit or otherwise impair any
security interests, mortgage liens, or other collateral that have been assigned
by Western National Bank to Lender, and all such assigned security interests,
mortgage liens, and other collateral shall remain in effect and continue to
secure the Loans and other obligations of the Borrower to the Lender under this
Loan Agreement and the other Loan Documents; and provided that nothing in this
Loan Agreement or the other Loan Documents shall act to impair or otherwise
adversely affect the creation, attachment, perfection, or priority of such
assigned security interests, mortgage liens, or other collateral.

<PAGE>

GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
Page 23 of 29

     16. Notice of Final Agreement. (a) In connection with the Loans, Borrower,
Guarantors, and Lender have executed and delivered this Loan Agreement and the
Loan Documents (collectively the "Written Loan Agreement").

          (b) It is the intention of Borrower, Guarantors, and Lender that this
paragraph be incorporated by reference into each of the Loan Documents.
Borrower, Guarantors, and Lender each warrant and represent that their entire
agreement with respect to the Loans is contained within the Written Loan
Agreement, and that no agreements or promises have been made by, or exist by or
among, Borrower, Guarantors, and Lender that are not reflected in the Written
Loan Agreement.

          (c) THE WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN
THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS,
OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN AGREEMENTS
BETWEEN THE PARTIES.

     If the foregoing correctly sets forth our agreement, please so acknowledge
by signing and returning the additional copy of this Loan Agreement enclosed to
me.

                                            Yours very truly,

                                            MERIDIAN BANK TEXAS

                                            By:  /s/  John Van Son
                                               --------------------------------
                                                      John Van Son,
                                                      Senior Vice President

Accepted and agreed to
this 7th day of December, 2009:

BORROWER:

GATEWAY ENERGY CORPORATION

<PAGE>

GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
Page 24 of 29

By:  /s/  Robert Panico
   -------------------------------
Name:      Robert Panico
Title:     President and Chief Executive Officer

<PAGE>

GATEWAY ENERGY CORPORATION
DECEMBER 7, 2009
Page 25 of 29

GUARANTORS:

GATEWAY PIPELINE COMPANY                      GATEWAY OFFSHORE PIPELINE COMPANY

By:  /s/  Robert Panico                       By:  /s/  Robert Panico
   -------------------------------               ------------------------------
Name:     Robert Panico                       Name:     Robert Panico
Title:    President                           Title:    President

GATEWAY PROCESSING COMPANY                    GATEWAY ENERGY MARKETING COMPANY

By:  /s/  Robert Panico                       By:  /s/  Robert Panico
   -------------------------------               ------------------------------
Name:     Robert Panico                       Name:     Robert Panico
Title:    President                           Title:    President

Exhibits and Schedules
----------------------
Exhibit A - Revolving Note
Exhibit B - Compliance Certificate
Schedule 1 - Deed of Trust
Schedule 2 - Organizational Chart
Schedule 3 - Existing Debts

<PAGE>

                                                                       EXHIBIT A

                               MERIDIAN BANK TEXAS

                            REVOLVING PROMISSORY NOTE
                            -------------------------

$6,000,000.00                   Fort Worth, Texas               December 7, 2009

     Promise to Pay. For value received, GATEWAY ENERGY CORPORATION
("Borrower"), a Delaware corporation, promises to pay to the order of MERIDIAN
BANK TEXAS ("Lender"), at its offices in Tarrant County, Texas, at 100 Lexington
Street, Suite 100, Fort Worth, Texas 76102, the sum of Six Million Dollars
($6,000,000.00) ("Total Principal Amount"), or such amount less than the Total
Principal Amount which is outstanding from time to time, in legal and lawful
money of the United States of America, together with interest thereon from this
date until maturity at a fluctuating rate per annum equal to the lesser of (a)
the sum of the Prime Rate in effect from day to day, plus one and one-half
percent (1.50%); or (b) the Maximum Rate; provided, however, that the interest
rate payable on this Note shall never fall below a floor rate of five and
one-half percent (5.5%) per annum. "Prime Rate" shall mean at any time the rate
of interest per annum then most recently established by The Wall Street Journal
as the "prime rate" on corporate loans for large U.S. commercial banks, as
published in the Money Rates section of The Wall Street Journal, computed on the
basis of a year of 360 days and for the actual number of days elapsed (including
the first day but excluding the last day); and "Maximum Rate" shall mean at the
particular time in question the maximum rate of interest which, under applicable
law, may then be charged on this Note. Each change in the interest rate shall
become effective without notice to Borrower on the effec-tive date of each
change in the Maximum Rate or the Prime Rate, as the case may be. If at any time
the rate based on the Prime Rate, together with all charges made in connection
with the loan evidenced by this Note that may be treated as interest under
applicable law, shall exceed the Maximum Rate, thereby causing the interest on
the principal of the Note to be limited to the Maximum Rate, then
notwithstanding any subse-quent change in either the Prime Rate or the Maximum
Rate that would otherwise reduce the rate based on the Prime Rate to less than
the Maximum Rate, the rate of interest on the principal of the Note shall remain
equal to the Maximum Rate until the total amount of interest accrued on the
principal of the Note equals the amount of interest which would have accrued on
the principal of the Note if the rate based on the Prime Rate had at all times
been in effect.

     Payment Terms. This Note is due and payable on the terms set out below:

     (a) interest shall be due and payable monthly as it accrues, commencing on
the 7th day of January, 2010, and continuing on the last day of each successive
month thereafter during the term of this Note; and

     (b) the principal of this Note shall be due and payable as required by the
Loan Agreement (as defined below) to meet any Borrowing Base deficiency or
Monthly Commitment Reductions (if and when required by Lender under the Loan
Agreement); and

(December 7, 2009)

<PAGE>

     (c) the outstanding principal balance of this Note, together with all
accrued but unpaid interest, shall be due and payable on the Maturity Date.
Unless its maturity is sooner accelerated as set forth herein, this Note will
mature on April 30, 2012 (the "Maturity Date"), at which time all unpaid sums
then owing will be payable in full, principal and interest.

This Note may be prepaid in whole or in part at any time without premium or
penalty.

     Security. Payment hereof is secured by the following (collectively the
"Loan Documents"): (1) obligations under a Loan Agreement of even date, executed
by Borrower, Lender, and GATEWAY PIPELINE COMPANY; GATEWAY OFFSHORE PIPELINE
COMPANY; GATEWAY PROCESSING COMPANY; and GATEWAY ENERGY MARKETING COMPANY
(collectively "Guarantors"), as amended (the "Loan Agreement"); (2) the liens
and security interests created by or described in the Deed of Trust and the
Security Agreement (as defined in the Loan Agreement); (3) all the other
Security Documents (as defined in the Loan Agreement) and all other instruments
now or hereafter described in the Loan Agreement or related thereto; and (4) any
other agreement (now existing or made hereafter) relating to the loans between
Lender and Borrower.

     Revolving Credit. Under the Loan Agreement, Borrower may request advances
and make payments hereunder from time to time, provided that it is understood
and agreed that the aggregate principal amount outstanding from time to time
hereunder shall not at any time exceed the Total Principal Amount or the
Borrowing Base as set forth in the Loan Agreement. In addition, under the terms
of the Loan Agreement, Lender may set monthly or quarterly commitment reductions
for the Borrowing Base, and the principal amount outstanding on this Note may
not exceed this reducing amount. The unpaid balance of this Note shall increase
and decrease with each new advance or payment hereunder, as the case may be.
This Note shall not be deemed terminated or canceled prior to the Maturity Date,
although the entire principal balance hereof may from time to time be paid in
full. Borrower may borrow, repay, and reborrow hereunder.

     Payments. Unless otherwise agreed to in writing or otherwise required by
applicable law, payments will be applied first to unpaid accrued interest, then
to principal, and any remaining amount to any unpaid collection costs,
delinquency charges, and other charges; provided, however, upon delinquency or
other Event of Default, Lender reserves the right to apply payments among
principal, interest, delinquency charges, collection costs, and other charges,
in such order and manner as the holder of this Note may from time to time
determine in its sole discretion. All payments and prepayments of principal of
or interest on this Note shall be made in lawful money of the United States of
America in immediately available funds, at the address of Lender indicated
above, or such other place as the holder of this Note shall designate in writing
to Borrower. If any payment of principal of or interest on this Note shall
become due on a day which is not a Business Day (as defined below), such payment
shall be made on the next succeeding Business Day and any such extension of time
shall be included in computing interest in connection with such payment. As used
herein, the term "Business Day" shall mean any day other than a Saturday,
Sunday, or any other day on which national banking associations are authorized
to be closed. The books and records of Lender shall be prima facie evidence of
all outstanding principal of and accrued and unpaid interest on this Note.

     Interest on Past Due Amounts and Default Interest. To the extent any
interest is not paid on or before the date it becomes due and payable, Lender
may, at its option, add such accrued but unpaid interest to the principal of
this Note. Notwithstanding anything herein to the contrary, (i) while any Event

(December 7, 2009)   Revolving Promissory Note - Page 2 of 5

<PAGE>

of Default (as defined below) is outstanding, (ii) upon notice from Lender of a
Borrowing Base deficiency under the Loan Agreement and thereafter so long as the
Borrowing Base deficiency exists, (iii) upon acceleration of the maturity hereof
following an uncured Event of Default, or (iv) at the Maturity Date, all
principal of this Note shall, at the option of Lender, bear interest at the
Maximum Rate until paid.

     Late Charge. If Lender has not received the full amount of any scheduled
payment by the end of ten (10) calendar days after the date it is due, Borrower
will pay to Lender a late charge in the amount of five percent (5%) of the
delinquent amount. Borrower is liable for this late charge only once for each
delinquent payment.

     Dishonored Check Charge. Borrower shall pay to Lender, on demand, a
processing fee in the amount of $28.00 for each check which is provided to
Lender by Borrower in payment of an obligation owing to Lender under any loan
document, but returned or dishonored for any reason.

     Events of Default. The occurrence at any time of any of the following
events or the existence of any of the following conditions shall collectively be
called "Events of Default" or singly called an "Event of Default":

     (a) Failure to make punctual payment when due of any sums owing on this
Note or any of the other Indebtedness (as defined in the Deed of Trust); or a
default under any other indebtedness of Borrower or Guarantors owing to the
Lender; or

     (b) Failure of any of the Obligated Parties (as defined below) to properly
perform any of the obligations, covenants, or agreements contained in the Loan
Documents; or any material representation or warranty made by any of the
Obligated Parties is or proves to have been false, misleading, or erroneous; or

     (c) Any "Event of Default" under the Loan Agreement or any of the Loan
Documents, the Events of Default defined in the Loan Agreement and the Loan
Documents being cumulative to those contained in this Note.

The term "Obligated Parties" used herein means Borrower, Guarantors, or either
of them, any other party liable, in whole or in part, for the payment of this
Note, whether as maker, endorser, guaran-tor, surety, or otherwise, and any
party executing any deed of trust, mortgage, security agreement, pledge
agreement, assignment, or other contract of any kind executed as securi-ty in
connection with or pertaining to this Note or loan.

     Remedies. Upon an Event of Default, and Borrower's failure to timely cure
such default following any notice, cure, or grace period required by the Loan
Agreement, at the option of Lender the entire indebt-edness evidenced hereby, as
well as all other liabili-ties of Borrow-er to Lender, shall be matured without
further notice, and Lender may exercise any or all of the rights and remedies
available to it, includ-ing, without limitation, those under this Note, the Loan
Documents, and any other instru-ment or agreement relating hereto, or any one or
more of them. The failure of Lender to exercise its option to accelerate the
maturity of this Note shall not constitute a waiver of its right to exercise the
same at any other time. Any Event of Default under this Note shall constitute a
default under each of the Loan Documents, and any default under any of the Loan
Documents shall constitute an Event of Default under this Note.

(December 7, 2009)   Revolving Promissory Note - Page 3 of 5

<PAGE>

     Waiver. Except such notice of default as is specifically required by the
Loan Agreement, Borrower and all other Obligated Parties sever-ally waive the
order of their liability, the marshaling of assets, demand, presentment for
payment, notice of dishon-or, protest and notice of protest, notice of default,
notice of intent to accelerate maturity, and notice of the acceleration.
Borrower and all other Obligated Parties agree to all renewals and extensions of
this Note and partial payments and releases or substitutions of security, in
whole or in part, with or without notice, before or after maturity. In case of
any renewal or extension of this Note or any part of the indebt-edness evidenced
hereby, all liens and security interests securing payment hereof will continue
to secure payment of the renewal or extension note or notes.

     Business Loan. Borrower represents to and covenants with Lender that: (1)
all loans evidenced by this Note are and shall be "business loans" as that term
is used in the Depository Institutions Deregulation and Monetary Control Act of
1980, as amended; and (2) the loans are for business, commercial, investment, or
other similar purposes and not for personal, family, household, or agricultural
use, as those terms are used in the Texas Finance Code. Borrower and Lender
further agree that Chapter 346 of the Texas Finance Code does not apply to this
Note, even if the Note evidences a revolving debt.

     Collection Costs. If this Note is placed in the hands of attorneys for
collection, if suit is filed hereon, if this Note is collect-ed through
bankruptcy proceedings (including any proceeding, federal or state, for the
relief of debtors), or if Lender becomes a party either as plaintiff or
defendant in any legal proceeding in relation to the property securing payment
of this Note, Borrower agrees to pay addition-al-ly to Lender reasonable
attorneys fees and collection costs.

     Savings Clause. Regardless of any provision contained in this Note, the
Loan Documents, or any instrument executed or delivered in connec-tion herewith,
it is the express intent of the parties that at no time shall any of the
Obligated Parties pay interest in excess of the Maximum Rate (or any other
interest amount which might in any way be deemed usurious), and Lender will
never be considered to have contracted for or to be entitled to charge, receive,
collect, or apply as interest on this Note, any amount in excess of the Maximum
Rate (or any other interest amount which might in any way be deemed usurious),
and, in the event that Lender ever receives, col-lects, or applies as interest
any such excess, the amount which would be excessive interest will be applied to
the reduction of the principal balance of this Note, and, if the principal
balance of this Note is paid in full, any remaining excess shall forthwith be
paid to Borrower. In determining whether the interest paid or payable exceeds
the Maximum Rate (or any other interest amount which might in any way be deemed
usurious), Borrower and Lender shall, to the maximum extent permitted under
applicable law: (1) characterize any non-principal payment (other than payments
which are expressly designated as interest payments hereunder) as an expense or
fee rather than as interest; (2) exclude voluntary prepayments and the effect
thereof; and (3) spread the total amount of interest throughout the entire
contemplated term of this Note so that the inter-est rate is uniform throughout
the term.

     Miscellaneous. EXCEPT TO THE EXTENT THAT THE LAWS OF THE UNITED STATES MAY
APPLY, THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF TEXAS. THIS INSTRU-MENT IS MADE AND IS PERFORMABLE IN FORT
WORTH, TARRANT COUNTY, TEXAS, AND IN THE EVENT OF A DISPUTE INVOLVING THIS NOTE
OR ANY OTHER INSTRUMENT EXECUTED IN CONNECTION HEREWITH, BORROWER IRREVOCABLY
AGREES THAT VENUE FOR SUCH DISPUTES SHALL BE IN ANY COURT OF COMPETENT
JURIS-DICTION IN TARRANT COUNTY, TEXAS.

(December 7, 2009)   Revolving Promissory Note - Page 4 of 5

<PAGE>

     Time is of the essence of this Note.

     This Note may not be changed orally, but only by an agreement in writing
signed by the party against whom en-force-ment of any waiver, change,
modification, or discharge is sought.

     This Note and all the covenants, promises, and agree-ments contained herein
are binding upon and inure to the benefit of Borrower and Lender and their
respective heirs, personal representatives, successors, and assigns.

     Section headings or captions are for convenience only and are not to be
used in interpreting the provisions of this Note.

     Renewal. This note is given in renewal and extension and not in
extinguishment of all amounts owing on the promissory note dated August 23,
2007, in the original principal amount of $20,000,000, made by Borrower and
payable to the order of Western National Bank.

     Executed and delivered to Lender in Fort Worth, Texas, on the date stated
above.

                                            GATEWAY ENERGY CORPORATION,
                                            a Delaware corporation

                                            By:________________________
                                            Name: _____________________
                                            Title: ______________________

This Note was prepared by:
HARRIS, FINLEY & BOGLE, P.C.
777 Main Street, Suite 3600
Fort Worth, Texas 76102-5341
(817) 870-8700

(December 7, 2009)   Revolving Promissory Note - Page 5 of 5

<PAGE>
                                                                       EXHIBIT B

                        QUARTERLY COMPLIANCE CERTIFICATE

     Pursuant to the Loan Agreement (the "Loan Agreement") dated December 7,
2009, between GATEWAY ENERGY CORPORATION, a Delaware corporation ("Borrower"),
and MERIDIAN BANK TEXAS ("Lender"), Borrower has reviewed its activities for the
fiscal quarter ending on ___________________, 200___, and hereby represents and
warrants to Lender that the information set forth below is true and correct as
of that date (capitalized terms below have the meanings assigned in the Loan
Agreement):

     1.  Financial Covenants.                           Required        Actual
         --------------------                           --------        ------

         (a)  Current Ratio (minimum)                  1.25 to 1.0  _____ to 1.0
              to be tested quarterly

              Current assets              $__________
              Current liabilities         $__________

For the purpose of this calculation, "Current Ratio" is defined as the ratio of
(i) current assets of Borrower and its subsidiaries on a consolidated basis,
plus until the Termination Date, amounts remaining to be advanced on the
Revolving Loan as limited under Subsection (a) of Section 1 of this Loan
Agreement, divided by (ii) current liabilities (excluding current maturities of
long-term debt) of Borrower and its subsidiaries on a consolidated basis.

         (b)  Debt to Tangible Net Worth Ratio (maximum) 0.5 to 1.0 _____ to 1.0
              to be tested quarterly

              Amount outstanding on Loans $__________
              Assets                      $__________
              Intangible assets           $__________
              Liabilities                 $__________

For the purposes of this calculation, "Debt to Tangible Net Worth Ratio" is
defined as the ratio of (i) the total amount outstanding on the Loans, divided
by (ii) the total value of Borrower's and its subsidiaries' assets, less the
value of Borrower's and its subsidiaries' intangible assets, less the total
amount of Borrower's and its consolidated subsidiaries liabilities.

         (c)  Debt Service Coverage Ratio (minimum)      1.5 to 1.0 _____ to 1.0
              to be tested quarterly

              EBITDA                      $__________
              Interest expense            $__________
              Actual principal and
              interest payments           $__________

(December 7, 2009)

<PAGE>

For the purpose of this calculation, "Debt Service Coverage Ratio" is defined as
the ratio of (i) EBITDA for Borrower and its subsidiaries on a consolidated
basis for the most recent quarter, divided by (ii) interest expense on the Loans
for the quarter, plus actual principal and interest payments on any other
indebtedness of Borrower and its subsidiaries for the most recent fiscal
quarter. "EBITDA" means, for any period, the pre-tax net income of the Borrower
and its consolidated subsidiaries for such period, plus (without duplication and
only to the extent deducted in determining such net income) interest expense of
the Borrower and its consolidated subsidiaries for such period, depreciation,
non-cash amortization, depletion, write down of assets and other non-cash
expenses of the Borrower and its consolidated subsidiaries for such period, plus
or minus, as the case may be, nonrecurring losses or gains resulting from the
sale of assets during such period (to the extent such losses or gains are
included in the determination of such net income).

     2. The undersigned officers hereby certify on behalf of Borrower that (a)
Borrower is in compliance with all covenants of the Loan Agreement, and (b) as
of the effective date of this compliance certificate and the date received by
Lender, no Event of Default or event that would, with the lapse of time or
giving of notice, or both, be an Event of Default, has occurred. The Revolving
Note and Loan Agreement are acknowledged, ratified, confirmed, and agreed by
Borrower to be valid, subsisting, and binding obligations. Borrower agrees that
there is no right to set off or defense to payment of the Revolving Note.

     Dated ____________________, 20___.

                                            GATEWAY ENERGY CORPORATION

                                            By:_________________________
                                            Name: ______________________
Title:_______________________

(December 7, 2009)     Compliance Certificate - Page 2 of 2ex10_1.htm

    
      

    

    
      Exhibit
10.1

      

      Modine
Manufacturing Company

      

      

      Share
Purchase Agreement

      

      

      By
and Between

      
 

      Modine
Manufacturing Company

       

       

      and

       

       

      KB
Synthetics

      

      

      Dated
as of December 4, 2009

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      SHARE
PURCHASE AGREEMENT

       

      This
Share Purchase Agreement (this “Agreement”) is entered into as of December 4,
2009 (the “Effective Date”), by and between:

      

      (1)           Modine
Manufacturing Company, a company organized and existing under the laws of the
State of Wisconsin (“Seller”); and

      

      (2)           KB
Synthetics Company Limited, a company organized and existing under the laws of
Korea with its office located at 1169-7 Jung ri-dong, Seo-gu, Daegu, Korea
(“Purchaser”).

      

      Seller
and Purchaser shall collectively be referred to hereinafter as the “Parties” or
individually as a “Party”.

       

      RECITALS:

      

      

      WHEREAS,
the Seller owns 100% of the 840,909 issued and outstanding capital contribution
units (the “Sale Shares”) of Modine Korea LLC (the “Company”), a company
organized and existing under the laws of the Republic of Korea (“Korea”);
and

      

      WHEREAS,
the Seller wishes to sell to the Purchaser, and the Purchaser wishes to
purchase, the Sale Shares, subject to the terms and conditions of this
Agreement.

       

      AGREEMENT

       

      NOW
THEREFORE, the Parties hereto agree as follows:

      

      
        	
                1.

              	
                Definitions

              

      

      

      As used
in this Agreement, the following terms shall have the following meanings, unless
the context clearly requires otherwise:

      

      
        	
                 
      

              	
                1.1

              	
                The
      terms defined hereinabove shall have the meaning set forth
      therein.

              

      

      

      
        	
                 
      

              	
                1.2

              	
                “Business
      Day” means any day which is not a Saturday, Sunday, or bank holiday in
      Korea or the United States of
America.

              

      

      

      
        	
                 
      

              	
                1.3

              	
                “Closing”
      has the meaning set forth in Section
4.1.

              

      

      

      
        	
                 
      

              	
                1.4

              	
                “Closing
      Date” has the meaning set forth in Section
4.1.

              

      

      
        
           

        

        
          - 1
-

          
            

          

        

        
           

        

      

      Execution
Version – Share Purchase Agreement

      

      

      
        	
                 
      

              	
                1.5

              	
                “Damages”
      has the meaning set forth in Section
10.1.

              

      

      

      
        	
                 
      

              	
                1.6

              	
                “EPG
      Products” means the engine products listed in Schedule 1.6, or products
      similar to the products listed in Schedule
1.6.

              

      

      
      

      
        	
                 
      

              	
                1.7

              	
                “Government
      Authority” means any national, provincial or local (including city)
      government in Korea, any political subdivision thereof or any other
      governmental, judicial, public, regulatory, or statutory instrumentality,
      authority, body, agency, department, bureau or entity or any arbitrator
      with authority to bind a Party hereto at
law.

              

      

      

      
        	
                 
      

              	
                1.8

              	
                “GOHAR
      Type Products” means the products listed in Schedule 1.8, or products
      similar to the products listed in Schedule
1.8.

              

      

      

      
        	
                 
      

              	
                1.9

              	
                “Government
      Approval” means, with respect to any matter, (i) any and all permits,
      licenses, franchises, concessions, grants, consents, approvals, orders,
      registrations, authorizations, waivers, notices of no objection,
      clearances from, or filings or registrations with, a Governmental
      Authority, and (ii) the expiration of any and all waiting periods imposed
      by applicable Law, in each case in respect of such
  matter.

              

      

      

      
        	
                 
      

              	
                1.10

              	
                “Indemnified
      Party” and “Indemnifying Party” have the meanings set forth in Section
      10.1.

              

      

      

      
        	
                 
      

              	
                1.11

              	
                “Initial
      Purchase Price” means One Billion Four Hundred Million (1,400,000,000)
      Won.

              

      

      

      
        	
                 
      

              	
                1.12

              	
                “Intellectual
      Property” means all intellectual property rights, including patents,
      patent rights, trademarks, service marks, trade names, copyrights,
      applications for any of the foregoing, licenses, trade secrets, and
      know-how.

              

      

      

      
        	
                 
      

              	
                1.13

              	
                “Intercompany
      Loan” means the loan issued by the Seller to the Company and governed by
      the shareholder loan agreement between the Seller and the Company dated
      July 28, 2004, including all amendments
thereto.

              

      

      

      
        	
                 
      

              	
                1.14

              	
                “Intercompany
      Loan Agreement” means the shareholder loan agreement between the Seller
      and the Company dated July 28, 2004, including all amendments
      thereto.

              

      

      

      
        	
                 
      

              	
                1.15

              	
                “Knowledge”
      means the actual knowledge of the persons listed in Schedule
      1.15.

              

      

      

      
        	
                 
      

              	
                1.16

              	
                “Korea”
      means the Republic of Korea.

              

      

      

      
        	
                 
      

              	
                1.17

              	
                “Law”
      means the constitution, law, order, ordinance, regulation, public notice,
      guidance or other rule with legal
effect.

              

      

      

      
        	
                 
      

              	
                1.18

              	
                “Lien”
      means any mortgage, pledge, lien, security interest, conditional sale
      agreement, title retention agreement, encumbrance or other similar
      restrictions or limitations.

              

      

      
        
           

        

        
          - 2
-

          
            

          

        

        
           

        

      

      Execution
Version – Share Purchase Agreement

      

      

      
        	
                 
      

              	
                1.19

              	
                “Material
      Contract” means any contract, agreement, arrangement or instrument, other
      than a labor or employment contract or agreement, with a consideration of
      Ten Billion (10,000,000,000) Won or more or a contract term of one (1)
      year or more and to which the Company is a
  party.

              

      

      

      
        	
                 
      

              	
                1.20

              	
                “Net
      Purchase Price” means Fourteen Billion, Three Hundred Fifty Million, Eight
      Hundred Sixty One Thousand, Seven Hundred Twelve (14,350,861,712)
      Won.

              

      

      

      
        	
                 
      

              	
                1.21

              	
                “Party”
      and “Parties” have the meanings set forth in the
  Preamble.

              

      

      

      
        	
                 
      

              	
                1.22

              	
                “Purchase
      Price” has the meaning set forth in Section
3.1.

              

      

      

      
        	
                 
      

              	
                1.23

              	
                “Required
      Government Approvals” means each Government Approval required to be
      obtained in connection with the execution, delivery and performance of
      this Agreement.

              

      

      

      
        	
                 
      

              	
                1.24

              	
                “Tax”
      or “Taxes” means corporate tax, income tax, value added tax, capital gain
      tax, comprehensive land tax, property tax, acquisition tax, registration
      tax, license tax, customs, all other taxes, national health insurance,
      unemployment insurance, national pension, workers’ compensation insurance,
      and all other social security dues, imposed by the Government Authority,
      including any surtax, interest, fines, penalties or additions to tax that
      may become payable in respect of such
taxes.

              

      

      

      
        	
                 
      

              	
                1.25

              	
                “Third
      Party Claim” has the meaning set forth in Section
  10.6(a).

              

      

      

      
        	
                 
      

              	
                1.26

              	
                “Transaction”
      has the meaning set forth in Section
2.

              

      

      

      
        	
                 
      

              	
                1.27

              	
                “Won”
      means the Korean won, the lawful currency of
  Korea.

              

      

       

      
        	
                2.

              	
                Sale
      and Purchase of Sale Shares

              

      

      

      Subject
to the terms and conditions of this Agreement, at the Closing, the Purchaser
shall purchase the Sale Shares from the Seller, and the Seller shall sell the
Sale Shares to the Purchaser (the “Transaction”).

       

      
        	
                3.

              	
                Payment
      of Purchase Price

              

      

      

      
        
          	
                  3.1

                	
                  

                    Purchase
      Price. The
      purchase price for the Sale Shares shall be Fifteen Billion, Seven Hundred
      Fifty Million, Eight Hundred Sixty One Thousand, Seven Hundred Twelve
      (15,750,861,712) Won, which shall be the sum of the Initial Purchase Price
      and the Net Purchase Price (taken together, the “Purchase Price”). The
      Purchaser shall pay the Initial Purchase Price to the Seller before the
      close of business on the Effective Date, to an account to be designated by
      the Seller.  Except pursuant to Section 3.2 hereof, the Purchase
      Price shall not be adjusted for any
  reason.

                  

                

        

      

      
        
           

        

        
          - 3
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      Execution
Version – Share Purchase Agreement

      

      

      
        	
                3.2

              	
                PP&E and Inventory
      Adjustment.  Following a mutually agreeable verification
      process to be completed by the Purchaser no later than January 15, 2010
      solely for the purpose of confirming that any of the Company’s plant,
      property, equipment and inventory assets as listed in the Company’s
      records as of November 30, 2009 are missing or do not exist, the Purchase
      Price shall be reduced by an amount commensurate with the aggregate book
      value of such missing or non-existent assets in excess of One Hundred
      Million (100,000,000) Won. For the avoidance
      of doubt, the above adjustment will be triggered only in the event the
      aforementioned listed assets are proven by the mutually agreeable process
      to be missing or non-existent and Purchaser provides written evidence to
      that effect to Seller.  Notwithstanding any provision in this
      Section, the Purchase Price shall not be reduced if the aggregate amount
      of the book value of the missing or non-existent assets is less than One
      Hundred Million (100,000,000) Won.  Further, the maximum amount
      of reduction in the Purchase Price pursuant to this Section shall not in
      any event exceed One Billion (1,000,000,000)
  Won.

              

      

      

      
        	
                3.3

              	
                Forfeiture of Initial
      Purchase Price.  In the event the Parties fail to close
      the Transaction for any reason, other than a reason attributable solely to
      the Seller, the Purchaser shall forfeit any rights to the Initial Purchase
      Price, which shall remain the property of the Seller.  For the
      avoidance of doubt, any matter related to the human resources of the
      Company shall NOT be deemed a reason attributable to the
      Seller.

              

      

      

      
        	
                4.

              	
                Closing

              

      

      

      
        	
                4.1

              	
                Time and
      Place.  The purchase and sale of the Sale Shares
      contemplated by this Agreement shall be consummated at a closing (the
      “Closing”) to be held at 10:00 A.M. on December 23, 2009 or such other
      date and time as mutually agreed between the Parties (the “Closing
      Date”).  The Closing shall take place at the offices of Kim
      & Chang located at Northgate Building, 66 Juksun-Dong, Chongro-gu,
      Seoul, at 10:00 a.m. on the Closing
Date.

              

      

      

      
        	
                4.2

              	
                Actions at
      Closing.  At the Closing, the Parties hereto shall
      perform the following actions:

              

      

      

      
        	
                 
      

              	
                (a)

              	
                The
      Purchaser shall pay the Net Purchase Price to the Seller without any
      withholding, deduction or adjustment of any nature, by means of wire
      transfer of immediately available funds in Won into a bank account
      designated in writing by the Seller;
and

              

      

      

      
        	
                 
      

              	
                (b)

              	
                The
      Seller shall deliver to the Purchaser copies of (i) the unitholders
      meeting resolution (or written consent), (ii) the articles of
      incorporation of the Company, and (iii) the unitholder registry of the
      Company, all of which show the Purchaser as the sole unitholder of the
      Company holding the Sale Shares;
and

              

      

      
        
           

        

        
          - 4
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      Execution
Version – Share Purchase Agreement

      

      

      
        	
                 
      

              	
                (c)

              	
                In
      the event the entire balance of the Intercompany Loan has not yet been
      repaid in full by the Company at or prior to Closing pursuant to Section
      7.8, (i) the Purchaser shall deliver to the Seller the payment guarantee
      issued by the Purchaser in a form and substance acceptable to the Seller
      in its sole discretion that any then outstanding principal and interest
      under the Intercompany Loan shall be paid in full no later than March 31,
      2010, and (ii) the Seller shall deliver to the Purchaser an amendment to
      the Intercompany Loan Agreement which shall provide for repayment of the
      Intercompany Loan in accordance with the terms and conditions described
      hereunder.

              

      

      

      
        	
                5.

              	
                Representations
      and Warranties of the Seller

              

      

      

      The
Seller hereby represents and warrants to the Purchaser, as of the Effective Date
and as of the Closing (unless otherwise specified), as follows:

      

      
        	
                5.1

              	
                Representations and
      Warranties with Respect to the Seller and the Sale
      Shares.

              

      

      

      
        	
                 
      

              	
                (a)

              	
                Share
      Ownership. The Seller is the legal and beneficial owner of the Sale
      Shares.  Upon consummation of the Closing contemplated herein,
      the Purchaser will acquire from the Seller title to the Sale Shares, free
      and clear of all Liens.

              

      

      

      
        	
                 
      

              	
                (b)

              	
                Authorization of
      Agreement; Enforceability.

              

      

      

      
        	
                 
      

              	
                (i)

              	
                The
      Seller has all requisite corporate power and authority to execute, deliver
      and perform its obligations under this Agreement.  The
      execution, delivery and performance of this Agreement has been duly
      authorized by all necessary corporate action on the part of the
      Seller.

              

      

      

      
        	
                 
      

              	
                (ii)

              	
                This
      Agreement has been duly executed and delivered by the Seller and
      constitutes its valid and binding obligation, enforceable against it in
      accordance with its terms, except as such enforceability may be limited by
      bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
      or other similar Laws relating to or affecting creditors' rights
      generally.

              

      

      

      
        	
                 
      

              	
                (c)

              	
                Government Approval;
      No Conflicts with Law, Articles of Incorporation and Government
      Approval.

              

      

      

      
        	
                 
      

              	
                (i)

              	
                Except
      for the Required Government Approvals set forth in Schedule
      5.1(c), no Government Approval is required to have been made or
      obtained by the Seller under the relevant Law in connection with the
      execution, delivery and performance of this
  Agreement.

              

      

      
        
           

        

        
          - 5
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      Execution
Version – Share Purchase Agreement

      

      

      
        	
                 
      

              	
                (ii)

              	
                The
      execution, delivery and performance by the Seller of this Agreement will
      not: (x) violate any provision of the Seller’s Articles of Incorporation
      or other constitutional documents or (y) violate any Law or Government
      Approval applicable to the Seller.

              

      

       

      
        	
                5.2

              	
                Representations and
      Warranties with Respect to the
Company.

              

      

      

      
        	
                 
      

              	
                (a)

              	
                Organization of the
      Company.  The Company is duly organized and validly
      existing under the laws of Korea.

              

      

      

      
        	
                 
      

              	
                (b)

              	
                Capitalization.  As
      of the date of this Agreement, each unit of capital contribution of the
      Company has a par value of 5,000 Won per unit, and 840,909 units of
      capital contribution are issued and outstanding.  All of the
      Sale Shares have been duly authorized and validly issued and are fully
      paid and non-assessable. There are no outstanding options, warrants,
      subscription rights, calls or commitments, whether contingent or absolute,
      of any nature whatsoever relating to, or securities or rights convertible
      into, any class of unit of capital contribution of the Company, or
      contracts by which the Company is bound to issue additional units of
      capital contribution.

              

      

      

      
        	
                 
      

              	
                (c)

              	
                Material
      Contracts.  To the Seller’s Knowledge, as of the date of
      this Agreement, each Material Contract is in
      full force and effect, and there exists no default or event of default or
      event, occurrence, condition, or act which, with the giving of notice, the
      lapse of time, would become a default or event of default
      thereunder.  The Company has not violated any of the terms or
      conditions of any Material Contract in any material
      respect.  There is no Material Contract: (i) requiring the
      Company to obtain prior written consent to consummate the Transaction; or
      (ii) setting forth that a change of control of the Company constitutes an
      event of termination thereof.  The execution, delivery
      and performance by Seller of this Agreement and the consummation by Seller
      of the Transaction will not constitute (with due notice or lapse of time
      or both) a default under any Material Contract to which Seller is a party
      or by which Seller is bound.

              

      

      

      
        	
                6.

              	
                Representations
      and Warranties of the Purchaser

              

      

      

      The
Purchaser represents and warrants to the Seller, as of the Effective Date and as
of the Closing Date, as follows:

      
        
           

        

        
          - 6
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      Execution
Version – Share Purchase Agreement

      

      

      
        	
                6.1

              	
                Organization of the
      Purchaser.  The Purchaser is duly organized and validly
      existing under the laws of Korea.

              

      

      

      
        	
                6.2

              	
                Authorization of Agreement;
      Enforceability.

              

      

      

      
        	
                 
      

              	
                (a)

              	
                The
      Purchaser has all requisite corporate power and authority necessary to
      execute, deliver and perform its obligations under this
      Agreement.  The execution, delivery and performance of this
      Agreement has been duly authorized by all necessary corporate action on
      the part of the Purchaser.

              

      

      

      
        	
                 
      

              	
                (b)

              	
                This
      Agreement has been duly executed and delivered by the Purchaser and
      constitutes its valid and binding obligation, enforceable against it in
      accordance with its terms, except as such enforceability may be limited by
      bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
      or other similar Laws relating to or affecting creditors’ rights
      generally.

              

      

      

      
        	
                6.3

              	
                Government Approval;
      No Conflicts with Law, Articles of Incorporation and Government
      Approval.

              

      

      

      
        	
                 
      

              	
                (a)

              	
                Except
      for the Required Government Approvals with respect to the purchase of the
      Sale Shares set forth in Schedule
      6.3(a), no Government Approval is required to have been made or
      obtained by the Purchaser under the relevant Law in connection with the
      execution, delivery and performance of this
  Agreement.

              

      

      

      
        	
                 
      

              	
                (b)

              	
                The
      execution, delivery and performance of this Agreement by the Purchaser
      will not (i) violate any provision of the Purchaser’s articles of
      incorporation or other constitutional documents or (ii) violate any Law or
      Government Approval applicable to the
Purchaser.

              

      

      

      
        	
                6.4

              	
                Financial
      Capacity.   The Purchaser has and will have the
      financial capacity and means to pay the Purchase Price and to comply with
      any other obligations under this Agreement and will pay the Purchase Price
      and comply with such obligations in accordance with this
      Agreement.

              

      

       

      
        	
                7.

              	
                Covenants

              

      

      

      The
Seller and the Purchaser, as applicable, each covenant with the other as
follows:

      

      
        	
                7.1

              	
                Further
      Assurances.  Upon the terms and subject to the conditions
      contained herein, each of the Parties hereto shall in good faith, both
      before and after the Closing: (i) use all reasonable efforts to take, or
      cause to be taken, diligently all actions and do, or cause to be done, all
      things necessary, proper or advisable to consummate and make effective the
      Transaction, (ii) execute any documents and instruments which may be
      reasonably necessary or advisable to carry out the Transaction, and (iii)
      cooperate with each other in connection with the foregoing.  The
      Seller and the Purchaser shall cooperate with the other and shall use its
      best efforts before and after the Closing to (a) obtain the permits
      required to be obtained by it under any applicable Law in connection with
      the Transaction; (b) effect all necessary recordings, registrations and
      filings, including submissions of information requested by any Government
      Authority, and (c) fulfill all conditions to this Agreement applicable to
      such Party.  The Seller and the Purchaser will provide prompt
      notification to each other when any consent or permit contemplated
      hereunder is obtained and when any action, filing or notification is
      taken, made or given, as applicable, in connection
    therewith.

              

      

      
        
           

        

        
          - 7
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      Execution
Version – Share Purchase Agreement

      

      

      
        	
                7.2

              	
                Notification of
      Certain Matters.  Prior to the Closing Date, each Party
      hereto shall promptly give notice to the other Party of (a) the occurrence
      of any event which occurrence has caused or is reasonably likely to cause,
      any representation or warranty of such Party contained in this Agreement
      to be untrue or inaccurate, and (b) any failure of such Party to comply
      with or satisfy any material covenant, condition or agreement to be
      complied with or satisfied by it under this
  Agreement.

              

      

      

      
        	
                7.3

              	
                Conduct of
      Business.  From the Effective Date until the Closing, the
      Seller shall cause the Company:

              

      

      

      
        	
                 
      

              	
                (a)

              	
                to
      conduct its operations according to its ordinary and usual course of
      business and consistent with past
practice;

              

      

      

      
        	
                 
      

              	
                (b)

              	
                not
      to carry out or effect any capital expenditure in each single case
      exceeding an amount of 125,000,000 Won without the prior written consent
      of the Purchaser;

              

      

      

      
        	
                 
      

              	
                (c)

              	
                not
      to conclude contracts on the sale of or grant of any Lien over any asset
      that has a book value exceeding 125,000,000 Won, other than sales or
      transfers of inventory or accounts receivable in the ordinary course of
      business consistent with past practice, except for the incurrence of such
      loan(s) (including provision of collateral therefor) whose proceeds are
      used by the Company for the repayment of the Intercompany Loan pursuant to
      Section 7.8 hereof;

              

      

      

      
        	
                 
      

              	
                (d)

              	
                not
      to issue, sell, grant or otherwise dispose of any units of capital
      contribution of the Company, any options related to any units of capital
      contribution with respect to the Company or modify or amend any right of
      any holder of outstanding units of capital contribution of the
      Company;

              

      

      

      
        	
                 
      

              	
                (e)

              	
                not
      to assign, transfer or terminate any Material Contracts outside the
      ordinary course of business without the prior written consent of the
      Purchaser;

              

      

      
        
           

        

        
          - 8
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      Execution
Version – Share Purchase Agreement

      

      

      
        	
                 
      

              	
                (f)

              	
                not
      to conclude any contract which involves an annual expense exceeding an
      amount of 125,000,000 Won and which has a remaining term of more than 12
      months;

              

      

      

      
        	
                 
      

              	
                (g)

              	
                not
      to conclude any contract which involves an annual expense exceeding an
      amount of 125,000,000 Won and which provides for legal consequences in the
      event of a change of control;

              

      

      

      
        	
                 
      

              	
                (h)

              	
                not
      to abandon or allow to lapse any patents, trademarks or other Intellectual
      Property of the Company;

              

      

      

      
        	
                 
      

              	
                (i)

              	
                not
      to amend its articles of incorporation or take any action with respect to
      any such amendment or any recapitalization, reorganization, liquidation or
      dissolution of the Company; and

              

      

      

      
        	
                 
      

              	
                (j)

              	
                not
      to declare, set aside, make or pay any dividend or other distribution,
      payable in cash or property, with respect to any units of capital
      contribution or other ownership interest in the
  Company.

              

      

      

      
        	
                7.4

              	
                Non-Competition.

              

      

      

      
        	
                 
      

              	
                (a)

              	
                The
      Seller covenants and agrees that neither it nor any of its affiliates
      shall directly or indirectly:

              

      

      

      
        	
                 
      

              	
                (i)

              	
                for
      a period of one (1) year from the Closing Date, solicit for hire any
      officer or employee of the Company, except that this provision shall not
      apply to the employees listed in Schedule 7.4
      and “solicit for hire” shall not include referrals made by a placement
      agency or responses to any advertising appearing on the Internet or in a
      newspaper, magazine or trade publication placed in the ordinary course of
      business; or

              

      

      

      
        	
                 
      

              	
                (ii)

              	
                for
      a period of four (4) years from the Closing Date, own, manage, engage in
      or operate a business that designs, manufactures, markets, packages and
      distributes heating and air conditioning products in Korea for buses,
      trains and military vehicles and/or located in the passenger compartment
      of automobiles, trucks and off-highway
vehicles.

              

      

      

      
        	
                 
      

              	
                (b)

              	
                The
      Purchaser covenants and agrees that neither it nor any of its affiliates
      (including the Company) shall directly or
  indirectly:

              

      

      

      
        	
                 
      

              	
                (i)

              	
                for
      a period of one (1) year from the Closing Date, solicit for hire any
      officer or employee of the Seller; provided, however, that “solicit for
      hire” shall not include referrals made by a placement agency or responses
      to any advertising appearing on the Internet or in a newspaper, magazine
      or trade publication placed in the ordinary course of business;
      or

              

      

      
        
           

        

        
          - 9
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      Execution
Version – Share Purchase Agreement

      

      

      
        	
                 
      

              	
                (ii)

              	
                for
      a period of four (4) years from the Closing Date, except as otherwise
      agreed by the Parties, manage, engage in or operate a business that sells
      GOHAR Type Products anywhere in the world;
or

              

      

      

      
        	
                 
      

              	
                (iii)

              	
                for
      a period of four (4) years from the Closing Date, except as otherwise
      agreed by the Parties, manage, engage in or operate a business that sells
      any EPG Product(s) anywhere in the
world.

              

      

      

      
        	
                7.5

              	
                Public
      Statements.  The Parties hereto will agree upon the
      timing and content of any press release to be issued or any public
      disclosure to be made relating to the execution, content, and termination
      of this Agreement, and each Party hereto shall not issue any press release
      or make any public disclosure without the consent of the other Parties;
      provided
      that nothing in this Section 7.5 shall prevent any Party from issuing any
      press release or making any public disclosure that is required or
      advisable under any applicable Law. If either the Seller or the
      Purchaser determines that it is required by applicable Law to make any
      such disclosure, it shall send notice to such effect, accompanied by the
      text of the proposed disclosure, to the other Party as far in advance as
      practicable, and shall use good faith efforts to reflect any reasonable
      comments made by the other Party relating to the proposed
      disclosure.

              

      

      

      
        	
                7.6

              	
                Confidentiality.

              

      

      

      
        	
                 
      

              	
                (a)

              	
                Purchaser
      acknowledges that it has entered into the Confidentiality Agreement dated
      February 12, 2009 (the “Confidentiality Agreement”) and confirms that all
      relevant confidential documents and information concerning the Company
      shall be subject to the obligations set forth therein prior to
      Closing.

              

      

      

      
        	
                 
      

              	
                (b)

              	
                This
      section shall not prohibit disclosure or use of any information if and to
      the extent:

              

      

      

      
        	
                 
      

              	
                (i)

              	
                the
      disclosure or use is required by applicable Law, any regulatory body or
      any recognized stock exchange or may be advisable thereunder, provided
      that such disclosure or use is subject to Section
  7.6;

              

      

      

      
        	
                 
      

              	
                (ii)

              	
                the
      disclosure is made to a Governmental Authority in connection with the Tax
      affairs of the disclosing party;

              

      

      

      
        	
                 
      

              	
                (iii)

              	
                the
      information is or becomes publicly available (other than by breach of the
      Confidentiality Agreement or of this Agreement); provided, however, that
      prior to disclosure or use of any information pursuant to (i) or (ii), the
      Party concerned shall promptly notify and consult with the other Party of
      such requirement with a view to providing such other Party with the
      opportunity to (x) contest such disclosure or use or (y) otherwise to
      consult and agree on the timing and content of such disclosure or
      use.

              

      

      
        
           

        

        
          - 10
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      Execution
Version – Share Purchase Agreement

      

      

      
        
          	
                  7.7

                	
                  

                    Corporate Name.
         The
      Purchaser shall cause the Company to (a) immediately register a new
      corporate name and discontinue use of the name “Modine” in any external
      correspondence (including letters, emails, etc.), (b) within fifteen
      Business Days of the Closing, (i) remove the name “Modine” from all other
      business documents, (ii) remove all decals and logos containing the name
      “Modine” from all Company owned or leased vehicles and entry ways, (iii)
      provide suppliers of product packaging materials with the new company name
      to be used on all subsequently ordered packaging materials, (iv) remove
      the name “Modine” from all racks used for shipping products, (v)
      discontinue use of all decals and logos containing the name “Modine” on
      bus air conditioning units, and (vi) remove any logos containing the name
      “Modine” from all embossings on plastic or metal product components, and
      (c) no later than January 31, 2010, remove the name “Modine” and all logos
      containing the name “Modine” from all buildings leased or owned by the
      Company, including the plant, warehouse, guard house, apartments and
      dormitories.

                  

                

        

      

      

      
        
          
            	
                    7.8

                  	

                    

                      Intercompany
      Loan Repayment. Prior to the Closing Date, the Seller shall
      exert its commercially reasonable efforts to cause the Company to repay
      the balance of the Intercompany Loan and all accrued interest in full,
      notwithstanding Section 7.3 hereof.  However, in the event the
      entire balance of the Intercompany Loan has not yet been repaid in full by
      the Company at or prior to Closing for any reason,  the
      Purchaser shall ensure that the Company pays any remaining balance of the
      Intercompany Loan no later than March 31,
2010.

                    

                  

          

        

      

       

      
        	
                8.

              	
                Conditions
      Precedent to the Closing

              

      

      

      
        	
                8.1

              	
                Conditions to the Purchaser’s
      Obligations. The Purchaser will have no obligation to consummate
      the Transaction at the Closing unless each of the following conditions
      precedent is satisfied or waived in writing by the
    Purchaser:

              

      

      

      
        	
                 
      

              	
                (a)

              	
                Representations and
      Warranties; Covenants.  The representations and
      warranties set forth in Sections 5.1 and 5.2 hereof shall be true and
      correct in all material respects.  The Seller shall have
      performed in all material respects all obligations required under this
      Agreement to be performed by it prior to the
  Closing.

              

      

      

      
        	
                 
      

              	
                (b)

              	
                Compliance with Laws;
      No Adverse Action or Decision.  Since the Effective Date,
      (i) no Law shall have been promulgated or enacted that materially delays
      or makes illegal the performance of this Agreement; (ii) no order by any
      Government Authority that materially delays or makes illegal the
      performance of this Agreement shall be effective; and (iii) no Government
      Authority shall have instituted any Proceeding that seeks to materially
      delay or make illegal the performance of this
  Agreement.

              

      

      
        
           

        

        
          - 11
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      Execution
Version – Share Purchase Agreement

      

      

      
        	
                 
      

              	
                (c)

              	
                Consents.  All
      Required Government Approvals required to be obtained by the Seller prior
      to the Closing shall have been obtained and shall not be subject to any
      material conditions.

              

      

      

      
        
          	
                	
                  (d)

                	
                  Resignation of
      Directors. All
      members of the Board of Directors of the Company have provided a letter of
      resignation as director effective upon the
  Closing.

                

        

      

      

      
        	
                8.2

              	
                Conditions to the Seller’s
      Obligations.  The Seller will not have any obligation to
      consummate the Transaction at the Closing unless each of the following
      conditions precedent is satisfied or waived in writing by the
      Seller:

              

      

      

      
        	
                 
      

              	
                (a)

              	
                Representations and
      Warranties; Covenants.  The representations and
      warranties of the Purchaser set forth in Section 6 hereof shall be true
      and correct in all material respects.  The Purchaser shall have
      performed in all material respects all obligations required under this
      Agreement to be performed by it prior to the
  Closing.

              

      

      

      
        	
                 
      

              	
                (b)

              	
                Compliance with Laws;
      No Adverse Action or Decision.  Since the Effective Date,
      (i) no Law shall have been promulgated or enacted that materially delays
      or makes illegal the performance of this Agreement; (ii) no order by any
      Government Authority that materially delays or makes illegal the
      performance of this Agreement shall be effective; and (iii) no Government
      Authority shall have instituted any Proceeding that seeks to materially
      delay or make illegal the performance of this
  Agreement.

              

      

      

      
        	
                 
      

              	
                (c)

              	
                Consents.  All
      Required Government Approvals required to be obtained by the Purchaser
      prior to the Closing shall have been obtained and shall not be subject to
      any conditions that would have a Material Adverse
  Effect.

              

      

      

      
        	
                9.

              	
                Termination

              

      

      

      
        	
                9.1

              	
                Termination of
      Agreement.  Subject to Section 9.2, this Agreement may be
      terminated by notice to the other Party in writing prior to the Closing by
      the Purchaser or the Seller for each of the following cases; provided, however, that
      the right to terminate this Agreement shall not be available to any Party
      who is responsible for any of the following cases, and this Agreement
      shall not be terminated for any reason after the
  Closing:

              

      

      
        
           

        

        
          - 12
-

          
            

          

        

        
           

        

      

      Execution
Version – Share Purchase Agreement

      

      

      
        	
                 
      

              	
                (a)

              	
                the
      Closing has not occurred by January 15,
2010;

              

      

      

      
        	
                 
      

              	
                (b)

              	
                the
      other Party is in material breach of any representation, warranty,
      covenant or agreement contained in this Agreement and such breach is (i)
      of such a serious nature that, if not remedied, would have a severe
      financial impact on the other Party upon Closing and (ii) has not been
      cured within fifteen (15) days following receipt of notice of such breach
      from the other Party; or

              

      

      

      
        	
                 
      

              	
                (c)

              	
                there
      is a mutual agreement of the
Parties.

              

      

      

      
        	
                9.2

              	
                Effect of
      Termination.  If this Agreement is terminated in
      accordance with Section 9.1, this Agreement shall become null and void and
      of no further force and effect, except that the terms and provisions of
      Sections 3.3, 7.6, 9.2, 9.3, 10, and 11 shall remain in full force and
      effect.

              

      

      

      
        	
                9.3

              	
                Remedies.  All
      rights and remedies existing under this Agreement are exclusive of any
      rights or remedies otherwise available under any applicable
      Law.

              

      

       

      
        	
                10.

              	
                Indemnification
      and Survival Period

              

      

      

      
        	
                10.1

              	
                Indemnification.  Each
      Party hereto (the “Indemnifying Party”) shall indemnify the other Party
      (the “Indemnified Party”) against, and hold the other Party, its
      successors and assigns harmless from, any and all damages, taxes, claims,
      losses, payments, charges, judgments, amounts paid in settlement,
      liabilities or expenses, including without limitation, interest, fines,
      penalties and reasonable attorneys’ fees, expenses and disbursements
      (collectively, “Damages”), arising out of the breach of any warranty or
      representation of the Indemnifying Party contained in this
      Agreement.  For the purpose of this Section 10.1, a termination
      of this Agreement pursuant to Section 9.1(a) shall not constitute a breach
      of any warranty or representation by any Party hereto under this Agreement
      and the Transaction, and no Party hereto shall be responsible for such
      termination.

              

      

      

      
        	
                10.2

              	
                Damage
      Threshold.  Neither the Seller nor the Purchaser, in its
      capacity as an Indemnifying Party, shall have any obligation to indemnify
      the other Party from and against any Damages pursuant to Section 10.1
      above until the other Party has suffered Damages in excess of an aggregate
      threshold of three percent (3%) of the total Purchase Price (with
      individual claims less than One Hundred Million (100,000,000) Won not to
      be included in the preceding aggregate threshold), at which point the
      Indemnifying Party will be obligated to indemnify the other Party from and
      against all such Damages in excess of such threshold
      amount.  The Parties hereto also agree that the maximum
      aggregate amount, which the Purchaser may recover from the Seller in
      respect of all claims, is ten percent (10%) of the total Purchase
      Price.

              

      

      
        
           

        

        
          - 13
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      Execution
Version – Share Purchase Agreement

      

      

      
        	
                10.3

              	
                Survival of the
      Representations and Warranties.  The representations and
      warranties of the Parties hereto shall survive for a period of eighteen
      (18) months after the Closing Date, except that the representation and
      warranty under Section 5.1(a) shall survive
  indefinitely.

              

      

      

      
        	
                10.4

              	
                Notice; Claim
      Period. Any Indemnified Party making a claim for indemnification
      hereunder shall notify the Indemnifying Party or Parties of the claim in
      writing.  To the extent possible, the notice shall specify and
      describe in detail the legal and factual basis of the claim, identify the
      supporting evidence, and contain an estimate of the Damages.  If
      a Party fails to deliver such notice within eighteen (18) months from the
      Closing Date, the Party shall not be entitled to make the relevant claim
      under this Agreement, provided that such limit shall not apply to the
      breach of the representation and warranty under Section
      5.1(a).

              

      

      

      
        	
                10.5

              	
                Exceptions; No
      Duplication; Sole Remedy.

              

      

      

      
        	
                 
      

              	
                (a)

              	
                The
      Indemnified Party shall take all reasonable steps to mitigate losses upon
      and after becoming aware of an event which, in the Indemnified Party’s
      good faith judgment, is reasonably likely to give rise to such
      Damages.

              

      

      

      
        	
                 
      

              	
                (b)

              	
                Any
      liability for indemnification hereunder shall be determined without
      duplication of recovery by reason of the state of facts giving rise to
      such liability constituting a breach of more than one representation,
      warranty, covenant or agreement.

              

      

      

      
        	
                 
      

              	
                (c)

              	
                The
      Indemnified Party’s rights to indemnification as provided for in Section
      10.1 shall constitute the Indemnified Party’s sole and exclusive remedy
      with respect to the breach of any warranty or representation of the
      Indemnifying Party contained in this
Agreement.

              

      

      

      
        	
                 
      

              	
                (d)

              	
                To
      the extent any Indemnified Party receives any insurance proceeds with
      respect to any Damages to be indemnified under this Agreement, such
      insurance proceeds shall be deducted from the relevant Damage amount
      payable.

              

      

      

      
        	
                 
      

              	
                (e)

              	
                In
      no event shall either Party be liable to the other Party hereunder for any
      consequential, incidental or special damages, absent intentional
      misconduct by the Indemnifying
Party.

              

      

      

      
        	
                10.6

              	
                Matters Involving
      Third Parties.

              

      

       

      
        	
                 
      

              	
                (a)

              	
                If
      any third party shall notify the Indemnified Party in writing with respect
      to any matter (a “Third Party Claim”), which may give rise to a claim for
      indemnification against the Indemnifying Party under this Agreement, then
      the Indemnified Party shall notify the Indemnifying Party thereof in
      writing within thirty (30) Business Days of receipt of notice of such
      claim.

              

      

      
        
           

        

        
          - 14
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      Execution
Version – Share Purchase Agreement

      

      

      
        	
                 
      

              	
                (b)

              	
                The
      Indemnifying Party shall have the right to defend the Indemnified Party
      against the Third Party Claim with counsel of the Indemnifying Party’s
      choice, at the Indemnifying Party’s sole expense. The Indemnifying Party
      may at its discretion consent to the entry of any judgment or enter into
      any settlement with respect to any Third Party Claim, provided that in the
      case of any settlement that provides for any relief other than the payment
      of monetary damages, such consent or settlement will be subject to the
      consent of the Indemnified Party, which consent will not be unreasonably
      withheld or delayed.  The Indemnifying Party will have full
      control of such defense and
proceedings.

              

      

      

      
        	
                 
      

              	
                (c)

              	
                Whether
      or not the Indemnifying Party elects to defend any Third Party Claim, the
      parties shall cooperate and exercise all reasonable efforts in the defense
      or prosecution of any such claim and shall furnish one another with such
      records, information and testimony, and attend such conferences,
      proceedings, hearings, trials and appeals as may be reasonably by the
      other in connection therewith.

              

      

       

      
        	
                11.

              	
                Miscellaneous

              

      

      

      
        	
                11.1

              	
                Fees and
      Expenses.  Except as otherwise expressly provided in this
      Agreement, each Party hereto shall pay all costs and expenses including,
      but not limited to, attorneys, accountants, consultants, agents and
      brokers’ fees, incurred or to be incurred by it in connection with this
      Agreement and the Transaction, regardless of whether the Closing has
      occurred.  However, to the extent the Company has accrued for
      the payment of any such expenses incurred prior to October 31, 2009, those
      expenses shall remain the obligation of the Company.  For the
      avoidance of any doubt, any success fee payable to the advisors of the
      Seller and related to the consummation of the Transaction shall remain the
      sole responsibility of the Seller.

              

      

      

      
        	
                11.2

              	
                Notices.  All
      notices, demands, requests, consents or other communi­cations
      hereunder shall be in writing and shall be given by personal delivery, by
      express courier, by registered or certified mail with return receipt
      requested, or by facsimile, to the Parties at the addresses shown below,
      or to such other address as may be designated by written notice given by
      either Party to the other Party.  Unless conclusively proven
      otherwise, all notices, demands, requests, consents or other
      communications hereunder shall be deemed effective upon delivery if
      personally delivered five (5) days after dispatch if sent by express
      courier, fourteen (14) days after dispatch if sent by registered or
      certified mail with return receipt requested, or confirmation of the
      receipt of the facsimile by the recipient if sent by
      facsimile.

              

      

      
        
           

        

        
          - 15
-

          
            

          

        

        
           

        

      

      Execution
Version – Share Purchase Agreement

      

      

      To Purchaser:

      

      KB
Synthetics Co., Ltd.

      Kabul
Building, 2-5, Galwol-dong

      Yongsan-gu,
Seoul, Korea

      Attention:
H. S. Park

      Facsimile:
822-775-1489

      

      To Seller:

      

      Modine
Manufacturing Company

      1500
DeKoven Avenue

      Racine,
Wisconsin, USA 53403

      Attention:
Margaret C. Kelsey, Esq.

      Facsimile:
262-631-7720

      

      
        	
                11.3

              	
                Governing
      Law.  This Agreement and all disputes arising out of or
      in connection with this Agreement shall be governed by, interpreted under,
      and construed and enforceable in accordance with, the laws of
      Korea.

              

      

      

      
        	
                11.4

              	
                Arbitration.   Any
      dispute arising from the performance or interpretation of this Agreement
      shall finally be settled in accordance with the Rules of Arbitration of
      the International Chamber of Commerce by three (3) arbitrators appointed
      in accordance with such rules. The place of arbitration shall be Singapore
      and the language of arbitration shall be
  English.

              

      

      

      
        	
                11.5

              	
                Entire
      Agreement.  This Agreement (including, Exhibits, Annexes,
      and Schedules hereto) and the agreements, documents and instruments to be
      executed and delivered pursuant hereto or thereto or referred to herein
      are intended to embody the final, complete and exclusive agreement among
      the Parties hereto with respect to the purchase of the Sale Shares and
      related transactions and supersede all prior agreements, understandings
      and representations written or oral, with respect
  thereto.

              

      

      

      
        	
                11.6

              	
                Severability.  If
      any provision hereof is found invalid, illegal or unenforce­able
      pursuant to any executive, legis­lative, judicial or other decree or
      decision, the remainder of this Agreement shall remain valid, legal and
      enforceable according to its terms, and such invalid, illegal or
      unenforceable provision shall be replaced with a provision that
      approximates the substance and spirit of the invalid, illegal or
      unenforce­able provision as closely as possible without being invalid,
      illegal or unenforceable.

              

      

      

      
        	
                11.7

              	
                Amendment.   This
      Agreement shall not be modified, amended, canceled or altered in any way,
      and may not be modified by custom, usage of trade or course of dealing,
      except by an instru­ment in writing signed by all Parties
      hereto.  All amendments or modifications of this Agreement shall
      be binding upon the Parties despite any lack of consideration so long as
      the same shall be in writing and executed by the
  Parties.

              

      

      
        
           

        

        
          - 16
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      Execution
Version – Share Purchase Agreement

      

      

      
        	
                11.8

              	
                Waiver.  The
      performance of any obligation required of a Party hereunder may be waived
      only by a written waiver signed by the other Party, and such waiver shall
      be effective only with respect to the specific obligation
      described.  The waiver by either Party of a breach of any
      provision of this Agreement by the other Party shall not operate or be
      construed as a waiver of any subsequent breach of the same provision or
      another provision of this
Agree­ment.

              

      

      

      
        	
                11.9

              	
                Assignment.  Neither
      this Agreement nor any rights or obligations hereunder shall be assignable
      or transferable by any Party to this Agreement without the prior written
      consent of the other Parties to this
Agreement.

              

      

      

      
        	
                11.10

              	
                Third Party
      Benefits.  This Agreement shall be binding upon, and
      inure to the benefit of, each of the Parties hereunder and their
      respective successors.  Nothing contained in this Agreement,
      express or implied, shall be deemed to confer any right or remedy upon, or
      obligate any Party to, any person or entity other than the Parties and
      their respective successors and permitted
  assigns.

              

      

      

      
        	
                11.11

              	
                Counterparts.  This
      Agreement may be executed simultaneously in any number of counterparts,
      each of which shall be deemed and original but all of which together shall
      constitute one and the same
instrument.

              

      

      

      
        	
                11.12

              	
                Captions.  The
      section headings and captions con­tained herein are for purposes of
      reference and convenience only and shall not in any way affect the meaning
      or interpreta­tion of this
Agreement.

              

      

      

      
        	
                11.13

              	
                Language. This
      Agreement shall be executed in English.  If there is any
      discrepancy in the content or interpretation of any translation of this
      Agreement in any language other than the English language, the English
      version shall prevail.

              

      

      

      [signature page to
follow]

      
        
           

        

        
          - 17
-

          
            

          

        

        
           

        

      

      Execution
Version – Share Purchase Agreement

      
 

      IN
WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of the
day and year first above written.

       

      
        	
                Modine
      Manufacturing Company

              	 
      	
                KB
      Synthetics Company Limited

              
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
                By:

              	
                /s/
      Thomas F. Marry

              	 
      	
                By:

              	
                /s/
      (Scott) Hyo Sang Park

              
	 
      	 
      	 
      	 
      	 
      
	
                Name:

              	
                Thomas
      F. Marry

              	 
      	
                Name:

              	
                Park,
      Hyo Sang

              
	 
      	 
      	 
      	 
      	 
      
	
                Title:

              	
                Regional
      VP – Asia and CPG

              	 
      	
                Title:

              	
                President

              
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
                By:

              	
                /s/
      Randall T. Davidson

              	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
                Name:

              	
                Randall
      T. Davidson

              	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
                Title:

              	
                Director
      – Modine Korea Transition

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