Document:

Investment
Cooperation Agreement

     

    This
Agreement was entered into by the following three parties in the conference room
of Shanxi Puda Coal Group Co., Ltd. on August 1, 2010.

    

    Party A:
Shanxi Puda Coal Group Co., Ltd.

    Legal
Representative: Ming ZHAO

    Address:
No. 426, Xuefu Road, Taiyuan, Shanxi Province

    

    Party B:
Ming ZHAO

    

    Party C:
Jianping GAO

    

    After
friendly negotiation, based on the principles of equality and mutual benefits,
Party A, Party B and Party C (collectively, “Co-Investors”) hereby enter into
the following Investment Cooperation Agreement with respect to Party A’s project
to acquire and consolidate eight coal mines located in Pinglu County, Yuncheng,
Shanxi Province, which has been approved by the relevant government authorities
(the “Pinglu Project”):

    

    
      	
              I.  

            	
              Project
      Background

            

    

    

    In
accordance with Circular [2009] No. 48 issued by the Office Governing Coal Mine
Consolidation of Shanxi Province (“Circular 48”), Party A has been appointed as
a coal mine consolidator and approved to acquire eight coal mines in Pinglu
County, Yuncheng, Shanxi Province, and consolidate them into five mines, with
the entity names of the five new coal mines being pre-approved by Circular
48.
The eight coal mines to be consolidated are:

    

    
      	
              (a)  

            	
              Pinglu
      County Guanyao Coal Co., Ltd. (“Guanyao Coal Mine” or “Guanyao”), Pinglu
      County Dawa Coal Mine (“Dawa Coal Mine” or “Dawa”), Pinglu County Sanmen
      Xuhutuo Coal Mine, Shanxi Pinglu Renling Coal Co., Ltd., and Pinglu County
      Anrui Coal Co., Ltd.; and

            

    

     

    
      
        
        

      

      
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              (b)  

            	
              Pinglu
      County Daqi Coal Mine, Pinglu County Donggou Coal Mine and Pinglu County
      Chuntouao Coal Mine.

            

    

    

    In
accordance with Circular 48, the pre-approved entity names of the five coal
mines set forth in Section I(a) after the consolidation are: Shanxi Pinglu
Dajinhe Coal Co., Ltd., Shanxi Pinglu Dajinhe Wujin Coal Co., Ltd., Shanxi
Pinglu Dajinhe Jinmen Coal Co., Ltd., Shanxi Pinglu Dajinhe Jinyi Coal Co., Ltd.
and Shanxi Pinglu Dajinhe Anrui Coal Co., Ltd. (each, a “Project Company” and
collectively, the “Project Companies”). As the approved consolidator of the coal
mines, Party A will be the registered principal shareholder of each Project
Company.

    

    Party A
has completed its acquisition of the mining assets (including physical assets
and mining rights) of Guanyao and Dawa in June 2010. Pursuant to Circular 48,
Party A has injected the purchased mining assets into two Project Companies
named Shanxi Pinglu Dajinhe Coal Co., Ltd., and Shanxi Pinglu Dajinhe Wujin Coal
Co., Ltd. (collectively, “Phase One of Pinglu Project”). At present, Party A is
actively negotiating with the owners of Pinglu County Sanmen Xuhutuo Coal Mine,
Shanxi Pinglu Renling Coal Co., Ltd., Pinglu County Anrui Coal Co., Ltd., Pinglu
County Daqi Coal Mine, Pinglu County Donggou Coal Mine and Pinglu County
Chuntouao Coal Mine (collectively, “Target Coal Mines”) on the transfer of their
physical assets and mining rights to Party A. The pre-approved names of the
Project Companies corresponding to Target Coal Mines after the consolidation
are: Shanxi Pinglu Dajinhe Jinmen Coal Co., Ltd. (Pinglu County Sanmen Xuhutuo
Coal Mine and Pinglu County Daqi Coal Mine before the consolidation), Shanxi
Pinglu Dajinhe Jinyi Coal Co., Ltd. (Shanxi Pinglu Renling Coal Co., Ltd. and
Pinglu County Donggou Coal Mine before the consolidation) and Shanxi Pinglu
Dajinhe Anrui Coal Co., Ltd. (Pinglu County Anrui Coal Co., Ltd. and Pinglu
County Chuntouao Coal Mine before the consolidation) (collectively, “Phase Two
of Pinglu Project” or the “Project”).

    

    
      
        
        

      

      
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              II.  

            	
              Manner
      of Cooperation

            

    

    

    As a
large amount of capital is needed for the assets acquisition and consolidation
of the Project, the production efficiency of the coal mines after the
acquisition and consolidation is expected to be greatly improved, and the return
on investment from the coal mines is expected to be high, the Co-Investors agree
to jointly invest in the Project, which includes the acquisition of the assets
of Target Coal Mines, the consolidation of coal mines and the establishment of
the Project Companies. The Co-Investors shall share the profits and bear the
risks and losses from the Project according to the percentages of their
respective investment.

    

    As Party
A is the sole appointed consolidator in the acquisition and consolidation of
Target Coal Mines and is the registered principal shareholder of each
corresponding Project Companies after the consolidation of coal mines, the
Co-Investors agree that, upon the formal registration and establishment of each
Project Company, Party B and Party C appoint Party A as the proxy holder for
their investments in such Project Company pursuant to a proxy agreement to be
subsequently entered into by the parties.

    

    The
Co-Investors agree to appoint their representatives to set up the Investment
Supervisory Committee (the “Committee”) for the Project, which shall be
responsible for reviewing the total capital requirement and investment time
frame for each stage of the Project. During the period from the effectiveness of
this Agreement to the formal registration and establishment of the Project
Companies, Party A shall set up an account jointly managed by the three parties.
The account will be the special account for the Project. The account will be
managed by personnel authorized by the Committee. The duties of the Committee
shall be agreed by the parties separately. The Co-Investors agree that the
Project Companies shall be registered and established under the Company Law of
the People’s Republic of China, and the specific matters in connection with the
establishment of the Project Companies shall be separately agreed.

    The
Co-Investors agree to authorize Party A to sign coal mining assets purchase
agreements with Target Coal Mines on behalf of the Co-Investors, and Party B and
Party C will be bound by such agreements signed by Party A on their
behalf.

     

    
      
        
        

      

      
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              III.  

            	
              Manner
      of Investment; Amount and Percentage of
  Investment

            

    

    

    1. Manner
of Investment: the investment shall be in RMB in cash and shall be injected into
the account jointly managed by the three parties.

    

    2.
Investment amount and time: the investment in the Project consists of three
stages: the investment for acquiring the assets of the Target Coal Mines, the
investment for the consolidation of the Target Coal Mines, and the investment
for the registration, establishment and operation of the Project Companies. The
investment amount and time for each stage shall be decided according to the
progress of the Project.

    

    3.
Investment percentage: The Co-Investors agree that their investment percentage
in the three stages of the investment for the Project shall always be: Party A
40%, Party B 30%, and Party C 30%.

    

    
      	
              IV.  

            	
              Project
      Management

            

    

    

    1. Before
entering into this Agreement, Party A and Party B have made certain payments for
the Project. Party A and Party B shall submit their previous expenses incurred
in connection with the application to be the coal mines consolidator, and the
expenses paid for the launch and preparation for the Project to the
Committee.  The Co-Investors agree that the reasonable amount
of  Party A and Party B that is verified and approved by the Committee
can be directly credited for Party A’s and Party B’s investment
amounts.

    

    2. The
Co-Investors unanimously agree that Party A shall be the project manager for the
Project (the “Project Manager”) and shall be in charge of the coal mine
acquisitions, the consolidation, the application for the licenses and
permissions for the Project Companies. Change of the Project Manager must be
agreed by Co-Investors.

    

    3. Party
A shall regularly report the progress of the Project to the Committee, Party B
and Party C shall not directly participate in the detailed management of the
Project. Party B and Party C have the right to inspect the performance of the
relevant Project Companies, and Party A shall report to Party B and Party C the
progress, business and financial conditions of the Project.

     

    
      
        
        

      

      
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              V.  

            	
              Profits
      and Risks

            

    

    

    1. Before
the registration and establishment of the Project Companies, Co-Investors shall
take responsibilities for the Target Coal Mines that are limited by their
investment amount.  Party A agrees that the fund for the Project shall
be used solely for the Project. A separate account shall be established for the
Project.  After the establishment of each Project Company, the
relevant Project Company shall be responsible for all of its indebtedness and
liabilities by using all of the assets of such Project Company. The Co-Investors
shall share the profits and bear the risks and losses according to, and subject
to the limitations of, the percentages of their equity injection.

    

    2. The
profits, losses and civil liabilities from joint investment in the Project that
will be managed by Party A shall belong to and shared by the
Co-Investors.

    

    3. Party
A will liable for any loss of the other Co-Investors in the execution of the
joint investment business to the extent such loss is the result of Party A’s
gross negligence or breach of any material terms of the
Agreement.  The other Co-Investors may raise objections to Party A’s
execution of the joint investment business. When an objection to a matter is
being raised, the execution of that matter shall be suspended. In the event
there is any dispute with respect to the execution of the matter, it shall be
resolved by the Co-Investors.

    

    4. The
Co-Investors agree in principle that, to the extent permitted by the law, after
a Project Company becomes operational, the dividend to be distributed to the
Co-Investor every year by the Project Company shall be no less than 80% of the
audited annual net income of such Project Company. The specific terms of the
dividend distribution shall be regulated separately in the Articles of
Association for each relevant Project Company.

     

    
      
        
        

      

      
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              VI.  

            	
              Transfer
      of Investment

            

    

    

    1. The
equity in the Project Companies and any derivative property based on such equity
are the common property of the Co-Investors and shall be owned by the
Co-Investors according to their respective investment percentages in the Project
Companies.

    

    2. The
equity in the Project Companies held by a Co-Investor may be transferred with
the consent of the Co-Investors holding the majority of the voting right (the
transferor is entitled to participating in such consent).  Upon the
transfer, transferees of such equity will be entitled to sharing the benefit and
equity of the Project according to their investment percentages.

    

    3. When
any party intends to transfer all or part of his/its equity in the Project
Companies, it/he shall obtain the consent of the Co-Investors holding the
majority of the voting rights (the transferor is entitled to participating in
such consent).  Once the transfer is approved, the non-transferring
Co-Investors shall have a right of first refusal, but not an obligation, to
purchase the equity of the transferring Co-Investor on the same terms and
conditions as the third party offer. One or more non-transferring Co-Investors
may purchase the equity to be transferred solely or
collectively.   In the event they intend to collectively purchase
such equity, they shall purchase the equity according to their relative
investment percentage to each other.

    

    4. Party
A is entitled to purchasing the equity interest of Party B and/or Party C in the
Project Companies at Party A’s sole discretion at a price determined by an
independent professional appraiser.

    

    
      	
              VII.  

            	
              Other
      Rights and Obligations

            

    

    

    1. Party
A and other Co-Investors shall not transfer or dispose of the assets of the
joint investment without the consents of the Co-Investors holding a majority of
the voting rights (the transferor can participate in the vote).

     

    
      
        
        

      

      
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    2.
Without the consent of all of the Co-Investors, no Co-Investor may withdraw
its/his investment from the joint investment.

    

    3. During
the investment cooperation period (including after the establishment of the
Project Companies), each of Party B and Party C agrees to transfer 5.5% voting
right owned by such party relating to their equity in the Project Companies to
Party A so that Party A can cast vote on such 11% additional
equity.

    

    
      	
              VIII.  

            	
              Liabilities
      for Breach of Contract

            

    

    

    1. In
order to guarantee the performance of the Agreement, Party A is willing to use
its investment to each relevant Project Company as guarantee to the other
Co-Investors that Party A will be responsible for breach of this Agreement in
the event that any fraud or gross negligence by Party A causes loss by such
Project Company.

    

    2. If any
of Co-Investor fails to make its investment contribution according to Article 3
of this Agreement, such Co-Investor shall be liable for any loss resulted
therefrom.

    

    
      	
              IX.  

            	
              Termination
      of Agreement

            

    

    

    This
Agreement will be terminated when:

    1. All
the equity of Party B and Party C in Project Companies are purchased by Party
A.

    

    2. All
the equity of Party B and Party C in the Project Companies are specifically
registered under the names of Party B and Party C, respectively, at the
Administration of Industry and Commerce.

     

    
      	
              X.  

            	
              Dispute
      Resolution

            

    

    

    Any
dispute arising out of or in connection with this Agreement shall be resolved by
the Co-Investors through friendly negotiation.  In the event it can
not be resolved through negotiation, it shall be submitted to Taiyuan
Arbitration Commission for arbitration according to its temporary rules of
procedure. The arbitration award shall be final and binding on all
Co-Investors.

    

    
      
        
        

      

      
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    During
the arbitration process, except for the part subject to the dispute and
arbitration, the performance of this Agreement shall continue.

    

    
      	
              XI.  

            	
              Governing
      Law

            

    

    

    The entry
into, effectiveness, interpretation and performance of this Agreement and any
dispute arising out of or in connection with this Agreement shall be governed by
the laws of the People’s Republic of China.

    

    
      	
              XII.  

            	
              Other
      Provisions

            

    

    

    1. The
matters not addressed in this Agreement shall be separately negotiated by Party
the parties.

    

    2. This
Agreement is made in three originals and shall be effective after being sealed
by the three parties and signed by their authorized
representatives.

    

    
      	
              Party
      A: Shanxi Puda Coal Group Co., Ltd.

            	
              Party
      B: Ming ZHAO

            	
              Party
      C: Jianping GAO

            
	
              Representative
      (Singature/Seal): /s/ Ming Zhao

            	
              Party
      B’s Signature: /s/ Ming Zhao

            	
              Party
      C’s Signature: /s/ Jianping Gao

            

    

    

    

    
      
        
        

      

      
        8/8EXECUTION
VERSION

    
      
        	 
      

      

    

     

    

     

    $100,000,000

    CREDIT
AGREEMENT

     

    Dated
as of July 30, 2010

     

    among

     

    SOLANA
RESOURCES LIMITED,

    as
Borrower,

     

    GRAN
TIERRA ENERGY INC.,

    as
Parent,

     

    BNP
PARIBAS,

    as
Administrative Agent and Global Coordinator,

     

    and

     

    The
Lenders Party Hereto

     

    
      
        

      

    

     

    BNP
PARIBAS

    Sole
Lead Arranger

    

    BNP
PARIBAS SECURITIES CORP.

    Sole
Bookrunner

    
      
        	 
      

      

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    
 

    Table
Of Contents

     

    
      
        
          	 
      	 	
                  Page

                
	 
      	 	 
      
	
                  ARTICLE
      I

                	 	 
      
	
                  DEFINITIONS
      AND ACCOUNTING MATTERS

                	 	 
      
	 
      	 
      	 	 
      
	
                  Section
      1.01

                	
                  Terms
      Defined Above

                	 	
                  1

                
	
                  Section
      1.02

                	
                  Certain
      Defined Terms

                	 	
                  1

                
	
                  Section
      1.03

                	
                  Types
      of Loans and Borrowings

                	 	
                  20

                
	
                  Section
      1.04

                	
                  Terms
      Generally; Rules of Construction

                	 	
                  21

                
	
                  Section
      1.05

                	
                  Accounting
      Terms and Determinations; GAAP

                	 	
                  21

                
	 
      	 	 
      
	
                  ARTICLE
      II

                	 	 
      
	
                  THE
      CREDITS

                	 	 
      
	 
      	 
      	 	 
      
	
                  Section
      2.01

                	
                  Commitments

                	 	
                  21

                
	
                  Section
      2.02

                	
                  Loans
      and Borrowings

                	 	
                  21

                
	
                  Section
      2.03

                	
                  Requests
      for Borrowings

                	 	
                  22

                
	
                  Section
      2.04

                	
                  Interest
      Elections

                	 	
                  23

                
	
                  Section
      2.05

                	
                  Funding
      of Borrowings

                	 	
                  24

                
	
                  Section
      2.06

                	
                  Termination
      and Reduction of Aggregate Maximum Credit Amounts

                	 	
                  25

                
	
                  Section
      2.07

                	
                  Borrowing
      Base

                	 	
                  25

                
	
                  Section
      2.08

                	
                  Letters
      of Credit

                	 	
                  27

                
	 
      	 	 
      
	
                  ARTICLE
      III

                	 	 
      
	
                  PAYMENTS
      OF PRINCIPAL AND INTEREST; PREPAYMENTS; FEES

                	 	 
      
	 
      	 
      	 	 
      
	
                  Section
      3.01

                	
                  Repayment
      of Loans

                	 	
                  31

                
	
                  Section
      3.02

                	
                  Interest

                	 	
                  31

                
	
                  Section
      3.03

                	
                  Alternate
      Rate of Interest

                	 	
                  32

                
	
                  Section
      3.04

                	
                  Prepayments

                	 	
                  33

                
	
                  Section
      3.05

                	
                  Fees

                	 	
                  34

                
	 
      	 	 
      
	
                  ARTICLE
      IV

                	 	 
      
	
                  PAYMENTS;
      PRO RATA TREATMENT; SHARING OF SET-OFFS

                	 	 
      
	 
      	 
      	 	 
      
	
                  Section
      4.01

                	
                  Payments
      Generally; Pro Rata Treatment; Sharing of Set-offs

                	 	
                  35

                
	
                  Section
      4.02

                	
                  Presumption
      of Payment by the Borrower

                	 	
                  36

                
	
                  Section
      4.03

                	
                  Defaulting
      Lenders

                	 	
                  36

                
	 
      	 	 
      
	
                  ARTICLE
      V

                	 	 
      
	
                  INCREASED
      COSTS; BREAK FUNDING PAYMENTS; TAXES; ILLEGALITY

                	 	 
      
	 
      	 
      	 	 
      
	
                  Section
      5.01

                	
                  Increased
      Costs

                	 	
                  38

                
	
                  Section
      5.02

                	
                  Break
      Funding Payments

                	 	
                  39

                
	
                  Section
      5.03

                	
                  Taxes

                	 	
                  39

                
	
                  Section
      5.04

                	
                  Designation
      of Different Lending Office

                	 	
                  40

                
	
                  Section
      5.05

                	
                  Illegality

                	 	
                  40

                
	 
      	 	 
      
	
                  ARTICLE
      VI

                	 	 
      
	
                  CONDITIONS
      PRECEDENT

                	 	 
      
	 
      	 
      	 	 
      
	
                  Section
      6.01

                	
                  Effective
      Date

                	 	
                  41

                
	
                  Section
      6.02

                	
                  Each
      Credit Event

                	 	
                  44

                
	
                  Section
      6.03

                	
                  Additional
      Conditions to Credit Events

                	 	
                  44

                

        

      

    

     

    
      
         

      

      
        i

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  ARTICLE
      VII

                	 	 
      
	
                  REPRESENTATIONS
      AND WARRANTIES

                	 	 
      
	 
      	 
      	 	 
      
	
                  Section
      7.01

                	
                  Organization;
      Powers

                	 	
                  45

                
	
                  Section
      7.02

                	
                  Authority;
      Enforceability

                	 	
                  45

                
	
                  Section
      7.03

                	
                  Approvals;
      No Conflicts

                	 	
                  45

                
	
                  Section
      7.04

                	
                  Financial
      Condition; No Material Adverse Change

                	 	
                  45

                
	
                  Section
      7.05

                	
                  Litigation

                	 	
                  46

                
	
                  Section
      7.06

                	
                  Environmental
      Matters

                	 	
                  46

                
	
                  Section
      7.07

                	
                  Compliance
      with the Laws and Agreements; No Defaults

                	 	
                  47

                
	
                  Section
      7.08

                	
                  Taxes

                	 	
                  47

                
	
                  Section
      7.09

                	
                  Employee
      Benefit Arrangements

                	 	
                  48

                
	
                  Section
      7.10

                	
                  Disclosure;
      No Material Misstatements

                	 	
                  48

                
	
                  Section
      7.11

                	
                  Insurance

                	 	
                  48

                
	
                  Section
      7.12

                	
                  Restrictive
      Agreements

                	 	
                  48

                
	
                  Section
      7.13

                	
                  Subsidiaries

                	 	
                  48

                
	
                  Section
      7.14

                	
                  Location
      of Business and Offices

                	 	
                  49

                
	
                  Section
      7.15

                	
                  Properties;
      Titles, Etc

                	 	
                  49

                
	
                  Section
      7.16

                	
                  Maintenance
      of Properties

                	 	
                  50

                
	
                  Section
      7.17

                	
                  Marketing
      of Production

                	 	
                  50

                
	
                  Section
      7.18

                	
                  Swap
      Agreements

                	 	
                  50

                
	
                  Section
      7.19

                	
                  Use
      of Loans and Letters of Credit

                	 	
                  51

                
	
                  Section
      7.20

                	
                  Solvency

                	 	
                  51

                
	
                  Section
      7.21

                	
                  Material
      Documents

                	 	
                  51

                
	
                  Section
      7.22

                	
                  Ranking

                	 	
                  51

                
	
                  Section
      7.23

                	
                  USA
      Patriot Act/Anti-Money Laundering

                	 	
                  51

                
	
                  Section
      7.24

                	
                  OFAC

                	 	
                  52

                
	
                  Section
      7.25

                	
                  Foreign
      Exchange Special Regime

                	 	
                  52

                
	 
      	 	 
      
	
                  ARTICLE
      VIII

                	 	 
      
	
                  AFFIRMATIVE
      COVENANTS

                	 	 
      
	 
      	 
      	 	 
      
	
                  Section
      8.01

                	
                  Financial
      Statements; Other Information

                	 	
                  52

                
	
                  Section
      8.02

                	
                  Notices
      of Material Events

                	 	
                  55

                
	
                  Section
      8.03

                	
                  Existence;
      Conduct of Business

                	 	
                  55

                
	
                  Section
      8.04

                	
                  Payment
      of Obligations

                	 	
                  56

                
	
                  Section
      8.05

                	
                  Performance
      of Obligations under Loan Documents

                	 	
                  56

                
	
                  Section
      8.06

                	
                  Operation
      and Maintenance of Properties

                	 	
                  56

                
	
                  Section
      8.07

                	
                  Insurance

                	 	
                  56

                
	
                  Section
      8.08

                	
                  Books
      and Records; Inspection Rights

                	 	
                  57

                
	
                  Section
      8.09

                	
                  Compliance
      with Laws

                	 	
                  57

                
	
                  Section
      8.10

                	
                  Environmental
      Matters

                	 	
                  57

                
	
                  Section
      8.11

                	
                  Further
      Assurances

                	 	
                  58

                
	
                  Section
      8.12

                	
                  Reserve
      Reports

                	 	
                  58

                
	
                  Section
      8.13

                	
                  Title
      Defects

                	 	
                  59

                
	
                  Section
      8.14

                	
                  Guaranty;
      Collateral

                	 	
                  59

                
	
                  Section
      8.15

                	
                  Unrestricted
      Subsidiaries

                	 	
                  60

                
	 
      	 	 
      
	
                  ARTICLE
      IX

                	 	 
      
	
                  NEGATIVE
      COVENANTS

                	 	 
      
	 
      	 
      	 	 
      
	
                  Section
      9.01

                	
                  Financial
      Covenants

                	 	
                  61

                
	
                  Section
      9.02

                	
                  Debt

                	 	
                  61

                

        

      

    

     

    
      
         

      

      
        ii

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  Section
      9.03

                	
                  Liens

                	 	
                  62

                
	
                  Section
      9.04

                	
                  Restricted
      Payments

                	 	
                  62

                
	
                  Section
      9.05

                	
                  Investments,
      Loans and Advances

                	 	
                  62

                
	
                  Section
      9.06

                	
                  Nature
      of Business; Investments by Unrestricted Subsidiaries

                	 	
                  64

                
	
                  Section
      9.07

                	
                  Limitation
      on Leases

                	 	
                  64

                
	
                  Section
      9.08

                	
                  Proceeds
      of Notes

                	 	
                  64

                
	
                  Section
      9.09

                	
                  Sale
      or Discount of Receivables

                	 	
                  64

                
	
                  Section
      9.10

                	
                  Mergers,
      Etc

                	 	
                  64

                
	
                  Section
      9.11

                	
                  Disposition
      of Properties

                	 	
                  65

                
	
                  Section
      9.12

                	
                  Environmental
      Matters

                	 	
                  65

                
	
                  Section
      9.13

                	
                  Transactions
      with Affiliates

                	 	
                  66

                
	
                  Section
      9.14

                	
                  Subsidiaries

                	 	
                  66

                
	
                  Section
      9.15

                	
                  Restrictive
      Agreements

                	 	
                  66

                
	
                  Section
      9.16

                	
                  Swap
      Agreements

                	 	
                  66

                
	
                  Section
      9.17

                	
                  Material
      Documents

                	 	
                  67

                
	
                  Section
      9.18

                	
                  Marketing
      Activities

                	 	
                  67

                
	 
      	 	 
      
	
                  ARTICLE
      X

                	 	 
      
	
                  EVENTS
      OF DEFAULT; REMEDIES

                	 	 
      
	 
      	 
      	 	 
      
	
                  Section
      10.01

                	
                  Events
      of Default

                	 	
                  67

                
	
                  Section
      10.02

                	
                  Remedies

                	 	
                  69

                
	 
      	 	 
      
	
                  ARTICLE
      XI

                	 	 
      
	
                  THE
      AGENTS

                	 	 
      
	 
      	 
      	 	 
      
	
                  Section
      11.01

                	
                  Appointment;
      Powers

                	 	
                  70

                
	
                  Section
      11.02

                	
                  Duties
      and Obligations of Administrative Agent

                	 	
                  71

                
	
                  Section
      11.03

                	
                  Action
      by Administrative Agent

                	 	
                  71

                
	
                  Section
      11.04

                	
                  Reliance
      by Administrative Agent

                	 	
                  72

                
	
                  Section
      11.05

                	
                  Subagents

                	 	
                  72

                
	
                  Section
      11.06

                	
                  Resignation
      or Removal of Administrative Agent

                	 	
                  72

                
	
                  Section
      11.07

                	
                  Agents
      as Lenders

                	 	
                  72

                
	
                  Section
      11.08

                	
                  No
      Reliance

                	 	
                  73

                
	
                  Section
      11.09

                	
                  Administrative
      Agent May File Proofs of Claim

                	 	
                  73

                
	
                  Section
      11.10

                	
                  Authority
      of Administrative Agent to Release Collateral and Liens

                	 	
                  74

                
	
                  Section
      11.11

                	
                  Colombian
      Security Documents

                	 	
                  74

                
	
                  Section
      11.12

                	
                  The
      Global Coordinator, Bookrunner and Arranger

                	 	
                  74

                
	 
      	 	 
      
	
                  ARTICLE
      XII

                	 	 
      
	
                  MISCELLANEOUS

                	 	 
      
	 
      	 
      	 	 
      
	
                  Section
      12.01

                	
                  Notices

                	 	
                  75

                
	
                  Section
      12.02

                	
                  Waivers;
      Amendments

                	 	
                  76

                
	
                  Section
      12.03

                	
                  Expenses,
      Indemnity; Damage Waiver

                	 	
                  77

                
	
                  Section
      12.04

                	
                  Successors
      and Assigns

                	 	
                  78

                
	
                  Section
      12.05

                	
                  Survival;
      Revival; Reinstatement

                	 	
                  81

                
	
                  Section
      12.06

                	
                  Counterparts;
      Integration; Effectiveness

                	 	
                  81

                
	
                  Section
      12.07

                	
                  Severability

                	 	
                  82

                
	
                  Section
      12.08

                	
                  Right
      of Setoff

                	 	
                  82

                
	
                  Section
      12.09

                	
                  Governing
      law; Jurisdiction; Consent to Service of Process

                	 	
                  82

                
	
                  Section
      12.10

                	
                  Headings

                	 	
                  83

                
	
                  Section
      12.11

                	
                  Confidentiality

                	 	
                  83

                
	
                  Section
      12.12

                	
                  Interest
      Rate Limitation

                	 	
                  84

                

        

      

    

     

    
      
         

      

      
        iii

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  Section
      12.13

                	
                  Judgment
      Currency

                	 	
                  85

                
	
                  Section
      12.14

                	
                  EXCULPATION
      PROVISIONS

                	 	
                  85

                
	
                  Section
      12.15

                	
                  Collateral
      Matters; Secured Swap Agreements

                	 	
                  85

                
	
                  Section
      12.16

                	
                  Collateral
      Assignment of Swap Agreements

                	 	
                  85

                
	
                  Section
      12.17

                	
                  No
      Third Party Beneficiaries

                	 	
                  86

                
	
                  Section
      12.18

                	
                  USA
      Patriot Act Notice

                	 	
                  86

                
	
                  Section
      12.19

                	
                  English
      Language

                	 	
                  87

                

        

      

    

     

    
      
         

      

      
        iv

        
          

        

      

      
         

      

    

     

    ANNEXES,
EXHIBITS AND SCHEDULES

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            	
                                                    Annex
      I

                                                  	
                                                    List
      of Maximum Credit Amounts

                                                  
	 
      	 
      
	
                                                    Exhibit
      A

                                                  	
                                                    Form
      of Note

                                                  
	
                                                    Exhibit
      B

                                                  	
                                                    Form
      of Borrowing Request

                                                  
	
                                                    Exhibit
      C

                                                  	
                                                    Form
      of Interest Election Request

                                                  
	
                                                    Exhibit
      D

                                                  	
                                                    Form
      of Compliance Certificate

                                                  
	
                                                    Exhibit
      E

                                                  	
                                                    Security
      Instruments

                                                  
	
                                                    Exhibit
      F

                                                  	
                                                    Form
      of Assignment and Assumption

                                                  
	 
      	 
      
	
                                                    Schedule
      1.02(a)

                                                  	
                                                    Colombian
      Hydrocarbon Properties/Concession Agreements

                                                  
	
                                                    Schedule
      1.02(b)

                                                  	
                                                    Eligible
      Buyers

                                                  
	
                                                    Schedule
      1.02(c)

                                                  	
                                                    Offtake
      Agreements

                                                  
	
                                                    Schedule
      7.05

                                                  	
                                                    Litigation

                                                  
	
                                                    Schedule
      7.06

                                                  	
                                                    Environmental
      Matters

                                                  
	
                                                    Schedule
      7.13

                                                  	
                                                    Subsidiaries

                                                  
	
                                                    Schedule
      7.18

                                                  	
                                                    Swap
      Agreements

                                                  
	
                                                    Schedule
      9.02

                                                  	
                                                    Debt

                                                  
	
                                                    Schedule
      9.05

                                                  	
                                                    Investments

                                                  

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
         

      

      
        v

        
          

        

      

      
         

      

    

    THIS CREDIT AGREEMENT dated as
of July 30, 2010, is among: SOLANA RESOURCES
LIMITED, a corporation duly formed and existing under the laws of the Province of Alberta,
Canada (the “Borrower”); GRAN
TIERRA ENERGY INC., a corporation duly formed and existing under the laws of
the State of Nevada
(the “Parent”); each of the
Lenders from time to time party hereto; and BNP PARIBAS (in its individual
capacity, “BNP
Paribas”), as administrative agent for the Lenders (in such capacity,
together with its successors in such capacity, the “Administrative
Agent”) and as global coordinator (in such capacity, together with its
successors in such capacity, the “Global
Coordinator”).

     

    RECITALS

     

    A.           The
Borrower and the Parent have requested that the Lenders provide certain loans to
and extensions of credit on behalf of the Borrower.

     

    B.           The
Lenders have agreed to make such loans and extensions of credit subject to the
terms and conditions of this Agreement.

     

    C.           In
consideration of the mutual covenants and agreements herein contained and of the
loans, extensions of credit and commitments hereinafter referred to, the parties
hereto agree as follows:

     

    ARTICLE
I

    Definitions
and Accounting Matters

     

    Section
1.01      Terms Defined
Above.  As used in this Agreement, each term defined above has
the meaning indicated above.

     

    Section
1.02      Certain Defined
Terms.  As used in this Agreement, the following terms have the
meanings specified below:

     

    “ABR”, when used in
reference to any Loan or Borrowing, refers to whether such Loan, or the Loans
comprising such Borrowing, are bearing interest at a rate determined by
reference to the Alternate Base Rate.

     

    “Adjusted LIBO Rate”
means, with respect to any Eurodollar Borrowing for any Interest Period, an
interest rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%)
equal to the LIBO Rate for such Interest Period multiplied by the Statutory
Reserve Rate.

     

    “Administrative
Questionnaire” means an Administrative Questionnaire in a form supplied
by the Administrative Agent.

     

    “Affected Loans” has
the meaning assigned such term in Section 5.05.

     

    “Affiliate” means,
with respect to a specified Person, another Person that directly, or indirectly
through one or more intermediaries, Controls or is Controlled by or is under
common Control with the Person specified.

     

    “Agents” means,
collectively, the Administrative Agent and the Global Coordinator; and “Agent” means either
the Administrative Agent or the Global Coordinator, as the context
requires.

     

    “Aggregate Maximum Credit
Amounts” at any time shall equal the sum of the Maximum Credit Amounts,
as the same may be reduced or terminated pursuant to Section 2.06.  On
the Effective Date, the Aggregate Maximum Credit Amounts is
$100,000,000.

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    “Agreement” means this
Credit Agreement, as the same may from time to time be amended, modified,
supplemented or restated.

     

    “Alternate Base Rate”
means, for any day, a rate per annum equal to the greatest of (a) the Prime
Rate in effect on such day, (b) the Federal Funds Effective Rate in effect
on such day plus 1⁄2 of 1%, and (c) the Adjusted LIBO Rate for a three month
Interest Period on such day (or if such day is not a Business Day, the
immediately preceding Business Day) plus 1%; provided that, for
the avoidance of doubt, the Adjusted LIBO Rate for any day shall be based on the
rate (rounded upwards, if necessary, to the next 1/100 of 1%) at which US Dollar
deposits of $5,000,000 with a three month maturity are offered by the principal
London office of the Administrative Agent in immediately available funds in the
London interbank market at approximately 11:00 a.m., London time, on such day
(or the immediately preceding Business Days if such day is not a day on which
banks are open for dealings in US Dollar deposits in the London interbank
market).  Any change in the Alternate Base Rate due to a change in the
Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate shall be
effective from and including the effective date of such change in the Prime
Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate,
respectively.

     

    “ANH” means Agencia
Nacional de Hidrocarburos.

     

    “Applicable Margin”
means, for any day, with respect to (a) any ABR Loan, a rate per annum equal to
2.50%; and (b) any Eurodollar Loan, a rate per annum equal to
3.50%.

     

    “Applicable
Percentage” means, with respect to any Lender, the percentage of the
Aggregate Maximum Credit Amounts represented by such Lender’s Maximum Credit
Amount as such percentage is set forth on Annex I.

     

    “Approved
Counterparty” means (a) any Lender or any Affiliate of a Lender and (b)
any other Person whose long term senior unsecured debt rating is A-/A3 by
S&P or Moody’s (or their equivalent) or higher.

     

    “Approved Fund” means
any Person (other than a natural person) that is engaged in making, purchasing,
holding or investing in bank loans and similar extensions of credit in the
ordinary course of its business and that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.

     

    “Approved Petroleum
Engineers” means (a) GLJ Petroleum Consultants Ltd. and (b) any other
independent petroleum engineers reasonably acceptable to the Administrative
Agent.

     

    “Arranger” means BNP Paribas, in its
capacity as the sole lead arranger hereunder.

     

    “ASC” means the
Financial Accounting Standards Board Accounting Standards Codification, as in
effect from time to time.

     

    “Assignment and
Assumption” means an assignment and assumption entered into by a Lender
and an assignee (with the consent of any party whose consent is required by
Section 12.04(b)), and accepted by the Administrative Agent, in the form of
Exhibit F or
any other form approved by the Administrative Agent.

     

    “Availability Period”
means the period from and including the Effective Date to but excluding the
Termination Date.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    “Board” means the
Board of Governors of the Federal Reserve System of the United States of America
or any successor Governmental Authority.

     

    “Bookrunner” means
BNP Paribas
Securities Corp., in its capacity as the sole bookrunner
hereunder.

     

    “Borrowing” means
Loans of the same Type, made, converted or continued on the same date and, in
the case of Eurodollar Loans, as to which a single Interest Period is in
effect.

     

    “Borrowing Base” means
at any time an amount equal to the amount determined in accordance with Section
2.07, as the same may be adjusted from time to time pursuant to Section 8.13 or
Section 9.11(d).

     

    “Borrowing Base
Deficiency” occurs at any time the total Revolving Credit Exposures
exceeds the Borrowing Base then in effect.

     

    “Borrowing Base Utilization
Percentage” means, as of any day, the fraction expressed as a percentage,
the numerator of which is the sum of the Revolving Credit Exposures of the
Lenders on such day, and the denominator of which is the Borrowing Base in
effect on such day.

     

    “Borrowing Request”
means a request by the Borrower for a Borrowing in accordance with Section
2.03.

     

    “Business Day” means
any day that is not a Saturday, Sunday or other day on which commercial banks in
New York City or Bogota, Colombia are authorized or required by law to remain
closed; and if such day relates to a Borrowing or continuation of, a payment or
prepayment of principal of or interest on, or a conversion of or into, or the
Interest Period for, a Eurodollar Loan or a notice by the Borrower with respect
to any such Borrowing or continuation, payment, prepayment, conversion or
Interest Period, any day which is also a day on which banks are open for
dealings in US Dollar deposits in the London interbank market.

     

    “Canadian Security
Documents” means, collectively, each of the following
documents:

     

    (a)           a
general security agreement executed and delivered by each of the Borrower, the
Parent and Gran Tierra Exchangeco Inc. in favour of the Administrative Agent (as
the same may be amended, restated, replaced, supplemented or otherwise modified
from time to time), in form and substance satisfactory to the Administrative
Agent;

     

    (b)           one
ore more securities pledge agreements executed and delivered by Gran Tierra
Exchangeco Inc. and Gran Tierra Callco ULC respecting all of the issued and
outstanding shares in the Borrower and Gran Tierra Exchangeco Inc. (as the same
may be amended, restated, replaced, supplemented or otherwise modified from time
to time), in form and substance satisfactory to the Administrative Agent;
and

     

    (c)           any
other documents reasonably required by the Administrative Agent to be executed
in connection with the creation, attachment and/or perfection under the laws of
Canada or any province thereof of the security interests to be granted pursuant
to the aforementioned security documents or any of the other Security
Instruments.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    “Capital Leases”
means, in respect of any Person, all leases which shall have been, or should
have been, in accordance with GAAP, recorded as capital leases on the balance
sheet of the Person liable (whether contingent or otherwise) for the payment of
rent thereunder.

     

    “Cash Collateral” has
the meaning assigned such term in Section 2.08(i)(ii).

     

    “Cash Collateralize”
means to pledge and deposit with or deliver to the Administrative Agent (as a
first priority, perfected security interest), for the benefit of the Secured
Parties, cash in US Dollars, at a location and pursuant to documentation in form
and substance satisfactory to the Administrative Agent.  “Cash Collateralized”
has a correlative meaning.

     

    “Cash
Equivalents” means any Investment of the types
described in Section 9.05(c) through (f), and any other Investments of a similar
nature approved by the Administrative Agent in its sole
discretion.

     

    “Casualty Event” means
any loss, casualty or other damage to, or any nationalization, taking under
power of eminent domain or by condemnation, seizure, taking or similar
proceeding of, any Property of any Credit Party having a Fair Market Value in
excess of $2,000,000.

     

    “Cayman Security
Documents” means, collectively, each of the following
documents:

     

    (a)           equitable
charges over the shares of Solana Petroleum Exploration, Gran Tierra Energy
International Holdings Ltd. and Gran Tierra Energy Cayman Islands Inc., together
with all annexures thereto, governed by the laws of the Cayman Islands (as the
same may be amended, restated, replaced, supplemented or otherwise modified from
time to time), in form and substance satisfactory to the Administrative Agent;
and

     

    (b)           any
other documents reasonably required by the Administrative Agent to be executed
in connection with the creation, attachment and/or perfection under the laws of
Cayman Islands of the security interests to be granted pursuant to the
aforementioned security documents or any of the other Security
Instruments.

     

    “Change in Control”
means (a) the acquisition of ownership, directly or indirectly, beneficially or
of record, by any Person or group (within the meaning of the Securities Exchange
Act of 1934 and the rules of the SEC thereunder as in effect on the date
hereof), of Equity Interests representing more than 40% of the
aggregate ordinary voting power represented by the issued and outstanding Equity
Interests of the Parent, (b) occupation of a majority of the seats (other than
vacant seats) on the board of directors of the Parent by Persons who were
neither (i) nominated by the board of directors of the Parent nor (ii) appointed
by directors so nominated, (c) the failure of the Parent to own, directly or
indirectly, 100% of the issued and outstanding Equity Interests of the Borrower,
or (d) the Borrower shall cease to be Controlled by the Parent.

     

    “Change in Law” means
(a) the adoption of any law, rule or regulation after the date of this
Agreement, (b) any change in any law, rule or regulation or in the
interpretation or application thereof by any Governmental Authority after the
date of this Agreement or (c) compliance by any Lender or the Issuing Bank (or,
for purposes of Section 5.01(b)), by any lending office of such Lender or by
such Lender’s or the Issuing Bank’s holding company, if any) with any request,
guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of this
Agreement.

     

    “Collateral” means all
the “Collateral” and “Derechos”, in each case, as
defined in the applicable Security Instruments and all other Property, now owned
or hereafter acquired on which Liens have been granted (or are required to have
been granted) to the Administrative Agent, for the benefit of the Secured
Parties, or to each Secured Party, as applicable, to secure the
Indebtedness.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    “Collateral Account”
has the meaning assigned such term in Section 2.08(i)(ii).

     

    “Collection Account”
means a deposit account approved by the Administrative Agent, and maintained
with BNP Paribas New York Branch, as depositary (or its successors in such
capacity), or one or more other banks satisfactory to the Administrative
Agent.

     

    “Colombia” means The
Republic of Colombia.

     

    “Colombian Branches”
means, collectively, (a) Solana Petroleum Exploration (Colombia) Limited, the
Colombian branch office of Solana Petroleum Exploration, and (b) Gran Tierra
Energy Colombia, Ltd., the Colombian branch office of Gran Tierra Energy
Colombia.

     

    “Colombian Hydrocarbon
Properties” means (a) as of the Effective Date, the Hydrocarbon Interests
set forth on Schedule
1.02(a); and (b) from time to time and at any time after the Effective
Date, all Hydrocarbon Interests in Colombia in which the Borrower or any
Subsidiary shall have an interest and that have been included in the Borrowing
Base.

     

    “Colombian Notes”
means the Colombian law pagarés with blank spaces and
their corresponding letters of instruction, issued by the Borrower and described
in Section 2.02(d), in form and substance satisfactory to the Administrative
Agent, together with all amendments, modifications, replacements, extensions and
rearrangements thereof.

     

    “Colombian Security
Documents” means, collectively, each of the following
documents:

     

    (a)           a
pledge agreement over the economic rights of Solana Petroleum Exploration in
Colombia under each Concession Agreement to which it is a party in existence on
the Effective Date, governed by the laws of Colombia and dated on or about the
Effective Date (as the same may be amended, restated, replaced, supplemented or
otherwise modified from time to time), in form and substance satisfactory to the
Administrative Agent, granting in favor of the Administrative Agent and each
other Secured Party a first priority security interest in such
rights;

     

    (b)           a
pledge agreement over the economic rights of Gran Tierra Energy Colombia in
Colombia under each Concession Agreement to which it is a party in existence on
the Effective Date, governed by the laws of Colombia and dated on or about the
Effective Date (as the same may be amended, restated, replaced, supplemented or
otherwise modified from time to time), in form and substance satisfactory to the
Administrative Agent, granting in favor of the Administrative Agent and each
other Secured Party a first priority security interest in such rights;
and

     

    (c)           any
other documents reasonably required by the Administrative Agent to be executed
in connection with the creation, attachment and/or perfection under the laws of
Colombia of the security interests to be granted pursuant to the aforementioned
security documents or any of the other Security Instruments.

     

    “Commitment” means,
with respect to each Lender, the commitment of such Lender to make Loans and to
acquire participations in Letters of Credit hereunder, expressed as an amount
representing the maximum aggregate amount of such Lender’s Revolving Credit
Exposure hereunder, as such commitment may be (a) modified from time to time
pursuant to Section 2.06 and (b) modified from time to time pursuant to
assignments by or to such Lender pursuant to Section 12.04(b).  The
amount representing each Lender’s Commitment shall at any time be the lesser of
such Lender’s Maximum Credit Amount and such Lender’s Applicable Percentage of
the then effective Borrowing Base.

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    “Commitment Fee Rate”
means a rate per annum equal to 1.50%.

     

    “Commodity Hedging
Agreement” means (a) any swap, forward, cap, floor, collar or other
similar transaction relating to the price of any category of Hydrocarbons or any
index calculated based on the price of one or more categories of Hydrocarbons,
(b) any option with respect to any of the foregoing transactions, (c) physical
forward contracts for set prices, provided that payment
is not made prior to delivery and (d) any combination of the foregoing
transactions.

     

    “Concession
Agreements” means, collectively, (a) each Hydrocarbon concession,
license, participation, exploration and production contract, production sharing
agreement or other similar agreement entered into between any Credit Party and
any Governmental Authority or other Person listed on Schedule 1.02(a), and
(b) any other Hydrocarbon concession, license, participation, exploration and
production contract, production sharing agreement or other similar agreement
entered into between any Credit Party and any Governmental Authority or other
Person, as each such agreement may be amended, restated, supplemented, replaced
or otherwise modified in accordance with this Agreement.

     

    “Consolidated Net
Income” means with respect to the Parent and the Consolidated
Subsidiaries, for any period, the aggregate of the net income (or loss) of the
Parent and the Consolidated Subsidiaries after allowances for taxes for such
period determined on a consolidated basis in accordance with GAAP; provided that there
shall be excluded from such net income (to the extent otherwise included
therein) the following: (a) the net income of any Person in which the Parent or
any Consolidated Subsidiary has an interest (which interest does not cause the
net income of such other Person to be consolidated with the net income of the
Parent and the Consolidated Subsidiaries in accordance with GAAP), except to the
extent of the amount of dividends or distributions actually paid in cash during
such period by such other Person to the Parent or to a Consolidated Subsidiary,
as the case may be; (b) the net income (but not loss) during such period of any
Consolidated Subsidiary to the extent that the declaration or payment of
dividends or similar distributions or transfers or loans by that Consolidated
Subsidiary is not at the time permitted by operation of the terms of its charter
or any agreement, instrument or Governmental Requirement applicable to such
Consolidated Subsidiary or is otherwise restricted or prohibited, in each case
determined in accordance with GAAP; (c) the net income (or loss) of any Person
acquired in a pooling-of-interests transaction for any period prior to the date
of such transaction; (d) any extraordinary non-cash gains or losses during such
period and (e) any gains or losses attributable to writeups or writedowns of
assets, including ceiling test writedowns; and provided further that if the
Parent or any Consolidated Subsidiary shall acquire or dispose of any Property
during such period, then Consolidated Net Income shall be calculated after
giving pro forma effect
to such acquisition or disposition, as if such acquisition or disposition had
occurred on the first day of such period.

     

    “Consolidated
Subsidiaries” means each Subsidiary of the Parent (whether now existing
or hereafter created or acquired) the financial statements of which shall be (or
should have been) consolidated with the financial statements of the Parent in
accordance with GAAP.

     

    “Control” means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the ability
to exercise voting power, by contract or otherwise.  For the purposes
of this definition, and without limiting the generality of the foregoing, any
Person that owns directly or indirectly 10% or more of the Equity Interests
having ordinary voting power for the election of the directors or other
governing body of a Person (other than as a limited partner of such other
Person) will be deemed to “control” such other Person.  “Controlling” and
“Controlled”
have meanings correlative thereto.

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    “Credit Parties”
means, collectively, the Parent, the Borrower and each Subsidiary
Guarantor.

     

    “CT Corporation” means
CT Corporation System, a Delaware corporation.

     

    “Currency Exchange
Agreement” means any agreement or arrangement providing for the transfer
or mitigation of risks of fluctuations in the exchange rate between currencies
either generally or under specific contingencies.

     

    “Debt” means, for any
Person, the sum of the following (without duplication): (a) all obligations of
such Person for borrowed money or evidenced by bonds, bankers’ acceptances,
debentures, notes or other similar instruments; (b) all obligations of such
Person (whether contingent or otherwise) in respect of letters of credit, surety
or other bonds and similar instruments; (c) all accounts payable and all accrued
expenses, liabilities or other obligations of such Person to pay the deferred
purchase price of Property or services (other than accounts payable and accrued
expenses, liabilities or other obligations to pay the deferred purchase price of
Property or services, from time to time incurred in the ordinary course of
business which are not greater than ninety (90) days past the date of invoice or
delinquent or which are being contested in good faith by appropriate action and
for which adequate reserves have been maintained in accordance with GAAP); (d)
all obligations under Capital Leases; (e) all obligations under Synthetic
Leases; (f) all Debt (as defined in the other clauses of this definition) of
others secured by (or for which the holder of such Debt has an existing right,
contingent or otherwise, to be secured by) a Lien on any Property of such
Person, whether or not such Debt is assumed by such Person; (g) all Debt (as
defined in the other clauses of this definition) of others guaranteed by such
Person or in which such Person otherwise assures a creditor against loss of the
Debt (howsoever such assurance shall be made) to the extent of the lesser of the
amount of such Debt and the maximum stated amount of such guarantee or assurance
against loss; (h) all obligations or undertakings of such Person to maintain or
cause to be maintained the financial position or covenants of others or to
purchase the Debt or Property of others; (i) obligations to deliver
commodities, goods or services, including, without limitation, Hydrocarbons, in
consideration of one or more advance payments, other than gas balancing
arrangements in the ordinary course of business; (j) obligations to pay for
goods or services even if such goods or services are not actually received or
utilized by such Person; (k) any Debt of a partnership for which such Person is
liable either by agreement, by operation of law or by a Governmental Requirement
but only to the extent of such liability; (l) Disqualified Capital Stock; and
(m) the undischarged balance of any production payment created by such Person or
for the creation of which such Person directly or indirectly received
payment.  The Debt of any Person shall include all obligations of such
Person of the character described above to the extent such Person remains
legally liable in respect thereof notwithstanding that any such obligation is
not included as a liability of such Person under GAAP.

     

    “Dedicated Cash
Receipts” means all cash received by or on behalf of any Credit Party
with respect to the following: (a) any amounts payable under or in connection
with any Material Document (including, without limitation, payments or proceeds
from Offtake Agreements and Swap Agreements); (b) cash representing operating
revenue earned or to be earned by any Credit Party; (c) proceeds from Loans; and
(d) any other cash received by any Credit Party from whatever source other than
(i) liability insurance proceeds required to be paid directly to third parties
and (ii) payments made to any Credit Party for the account of third parties
under or in connection with joint operating agreements or similar joint
development agreements.

     

    “Default” means any
event or condition which constitutes an Event of Default or which upon notice,
lapse of time or both would, unless cured or waived, become an Event of
Default.

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    “Defaulting Lender”
means any Lender, as determined by the Administrative Agent, that has (a) failed
to fund any portion of its Loans or participations in Letters of Credit within
three Business Days of the date required to be funded by it hereunder, (b)
notified the Borrower, the Administrative Agent, the Issuing Bank or any Lender
in writing that it does not intend to comply with any of its funding obligations
under this Agreement or has made a public statement to the effect that it does
not intend to comply with its funding obligations under this Agreement or under
other agreements in which it commits to extend credit, (c) failed, within three
Business Days after request by the Administrative Agent, to confirm that it will
comply with the terms of this Agreement relating to its obligations to fund
prospective Loans and participations in then outstanding Letters of Credit, (d)
otherwise failed to pay over to the Administrative Agent, the Issuing Bank or
any Lender any other amount required to be paid by it hereunder within three
Business Days of the date when due, unless the subject of a good faith dispute,
or (e) (i) become or is insolvent or has a parent company that has become or is
insolvent or (ii) become the subject of a bankruptcy or insolvency proceeding,
or has had a receiver, conservator, trustee or custodian appointed for it, or
has taken any action in furtherance of, or indicating its consent to, approval
of or acquiescence in any such proceeding or appointment or has a parent company
that has become the subject of a bankruptcy or insolvency proceeding, or has had
a receiver, conservator, trustee or custodian appointed for it, or has taken any
action in furtherance of, or indicating its consent to, approval of or
acquiescence in any such proceeding or appointment.

     

    “Deposit Account Control
Agreement” means a deposit account control agreement in form and
substance satisfactory to the Administrative Agent, as the same may be amended,
modified or supplemented from time to time.

     

    “Deposit Account Control
Agreement (Gran Tierra Energy Colombia)” means the Deposit Account
Control Agreement dated as of the Effective Date among the Gran Tierra Energy
Colombia, the Administrative Agent and JPMorgan Chase Bank, N.A. (and its
successors in such capacity), as the same may be amended, modified or
supplemented from time to time.

     

    “Deposit Account Control
Agreement (Solana Petroleum Exploration)” means the Deposit Account
Control Agreement dated as of the Effective Date among Solana Petroleum
Exploration, the Administrative Agent and BNP Paribas New York Branch, as
depositary (or its successors in such capacity), as the same may be amended,
modified or supplemented from time to time.

     

    “Disqualified Capital
Stock” means any Equity Interest that, by its terms (or by the terms of
any security into which it is convertible or for which it is exchangeable) or
upon the happening of any event, matures or is mandatorily redeemable for any
consideration other than other Equity Interests (which would not constitute
Disqualified Capital Stock), pursuant to a sinking fund obligation or otherwise,
or is convertible or exchangeable for Debt or redeemable for any consideration
other than other Equity Interests (which would not constitute Disqualified
Capital Stock) at the option of the holder thereof, in whole or in part, on or
prior to the date that is one year after the earlier of (a) the Maturity Date
and (b) the date on which there are no Loans, LC Exposure or other obligations
hereunder outstanding and all of the Commitments are terminated.

     

    “EBITDAX” means, for
any period, the sum of Consolidated Net Income for such period plus the
following expenses or charges to the extent deducted from Consolidated Net
Income in such period: interest, income taxes, depreciation, depletion,
amortization, exploration expenses and other similar noncash charges, minus all
noncash income added to Consolidated Net Income.

     

    “Effective Date” means
the date on which the conditions specified in Section 6.01 are satisfied (or
waived in accordance with Section 12.02).

    
      
         

      

      
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    “Eligible Buyers”
means (a) Ecopetrol S.A., (b) each of the Persons listed on Schedule 1.02(b), (c)
in the case of Colombian Hydrocarbon Properties not operated by any Credit
Party, any buyer approved by the operator thereof other than an Affiliate of the
Parent, and (d) any additional Persons that have been approved in writing by the
Administrative Agent and the Majority Lenders, acting reasonably, at the time of
the purchase of crude oil or other Hydrocarbons by such Person from any Credit
Party; provided
that any such Person shall cease to be an Eligible Buyer if:

     

    (i)           any
Credit Party has received any written notice or otherwise has knowledge that
such Person is the subject of any bankruptcy, insolvency, reorganization,
liquidation, dissolution or winding-up proceeding or action (whether voluntary
or involuntary); or

     

    (ii)           at
the time any such determination is made, more than 10% of the aggregate amount
of accounts due from such Person in respect of its purchase of crude oil or
other Hydrocarbons from any Credit Party has at such time remained unpaid for
more than 30 days (measured from the due date specified in the original invoice
therefor).

     

    “Engineering Reports”
has the meaning assigned such term in Section 2.07(c)(i).

     

    “Entitled Person” has
the meaning assigned such term in Section 12.13.

     

    “Environmental Laws”
means any and all Governmental Requirements pertaining in any way to health,
safety, the environment, the preservation or reclamation of natural resources,
or the management, Release or threatened Release of any Hazardous Materials, in
effect in any and all jurisdictions in which the Parent or any Subsidiary is
conducting, or at any time has conducted, business, or where any Property of the
Parent or any Subsidiary is located.

     

    “Environmental Permit”
means any permit, registration, license, notice, approval, consent, exemption,
variance, or other authorization required under or issued pursuant to applicable
Environmental Laws.

     

    “Equity Interests”
means shares of capital stock, partnership interests, membership interests in a
limited liability company, beneficial interests in a trust or other equity
ownership interests in a Person, and any warrants, options or other rights
entitling the holder thereof to purchase or acquire any such Equity
Interest.

     

    “Eurodollar”, when
used in reference to any Loan or Borrowing, refers to whether such Loan, or the
Loans comprising such Borrowing, are bearing interest at a rate determined by
reference to the Adjusted LIBO Rate.

     

    “Event of Default” has
the meaning assigned such term in Section 10.01.

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    “Excepted Liens”
means:  (a) Liens for Taxes, assessments or other governmental charges
or levies which are not delinquent or which are being contested in good faith by
appropriate action and for which adequate reserves have been maintained in
accordance with GAAP; (b) Liens in connection with workers’ compensation,
unemployment insurance or other social security, old age pension or public
liability obligations which are not delinquent or which are being contested in
good faith by appropriate action and for which adequate reserves have been
maintained in accordance with GAAP; (c) statutory landlord’s liens, operators’,
vendors’, carriers’, warehousemen’s, repairmen’s, mechanics’, suppliers’,
workers’, materialmen’s, construction or other like Liens arising by operation
of law in the ordinary course of business or incident to the exploration,
development, operation and maintenance of Oil and Gas Properties each of which
is in respect of obligations that are not delinquent or which are being
contested in good faith by appropriate action and for which adequate reserves
have been maintained in accordance with GAAP; (d) contractual Liens which arise
in the ordinary course of business under operating agreements, joint venture
agreements, oil and gas partnership agreements, oil and gas leases, farm-out
agreements, division orders, contracts for the sale, transportation or exchange
of oil and natural gas, unitization and pooling declarations and agreements,
area of mutual interest agreements, overriding royalty agreements, marketing
agreements, processing agreements, net profits 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 by appropriate action
and for which adequate reserves have been maintained in accordance with GAAP;
provided that
any such Lien referred to in this clause does not materially impair the use of
the Property covered by such Lien for the purposes for which such Property is
held by the Parent or any Subsidiary or materially impair the value of such
Property subject thereto; (e) Liens arising solely by virtue of any statutory or
common law provision relating to banker’s liens, rights of set-off or similar
rights and remedies and burdening only deposit accounts or other funds
maintained with a creditor depository institution; provided that no such
deposit account is a dedicated cash collateral account or is subject to
restrictions against access by the depositor in excess of those set forth by
regulations promulgated by the Board and no such deposit account is intended by
Parent or any of its Subsidiaries to provide collateral to the depository
institution; (f) easements, restrictions, servitudes, permits, conditions,
covenants, exceptions or reservations in any Property of the Parent or any
Subsidiary that do not secure any monetary obligations and which in the
aggregate do not materially impair the use of such Property for the purposes of
which such Property is held by the Parent or any Subsidiary or materially impair
the value of such Property subject thereto; (g) Liens on cash or securities
pledged to secure performance of tenders, surety and appeal bonds, government
contracts, performance and return of money bonds, bids, trade contracts, leases,
statutory obligations, regulatory obligations and other obligations of a like
nature incurred in the ordinary course of business and (h) judgment and
attachment Liens not giving rise to an Event of Default; provided that any
appropriate legal proceedings which may have been duly initiated for the review
of such judgment shall not have been finally terminated or the period within
which such proceeding may be initiated shall not have expired and no action to
enforce such Lien has been commenced; provided further that Liens
described in clauses (a) through (e) shall remain “Excepted Liens” only for so
long as no action to enforce such Lien has been commenced and no intention to
subordinate the first priority Lien granted in favor of the Administrative Agent
and the Lenders is to be hereby implied or expressed by the permitted existence
of such Excepted Liens.

     

    “Excluded Taxes”
means, with respect to the Administrative Agent, any Lender, the Issuing Bank or
any other recipient of any payment to be made by or on account of any obligation
of any Credit Party hereunder or under any other Loan Document, (a) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America or such other jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which any Credit Party is located and (c) in the
case of a Foreign Lender (other than any Lender party to this Agreement on the
Effective Date and an assignee pursuant to a request by the Borrower under
Section 5.04), any withholding tax that is imposed on amounts payable to such
Foreign Lender at the time such Foreign Lender becomes a party to this Agreement
(or designates a new lending office) or is attributable to such Foreign Lender’s
failure to comply with Section 5.03(e), except to the extent that such Foreign
Lender (or its assignor, if any) was entitled, at the time of designation of a
new lending office (or assignment), to receive additional amounts with respect
to such withholding tax pursuant to Section 5.03(a) or Section
5.03(b).

     

    “Fair Market Value”
shall mean, with respect to any Property on any date of determination, the value
of the consideration obtainable in a sale of such Property or at such date of
determination assuming a sale by a willing seller to a non-affiliated willing
purchaser dealing at arm’s length and arranged in an orderly manner over a
reasonable period of time having regard to the nature and characteristics of
such Property.

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    “Federal Funds Effective
Rate” means, for any day, the weighted average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers, as published on the next succeeding Business Day by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day that
is a Business Day, the average (rounded upwards, if necessary, to the next 1/100
of 1%) of the quotations for such day for such transactions received by the
Administrative Agent from three Federal funds brokers of recognized standing
selected by it.

     

    “Fee Letter” means the
letter agreement dated as of July 30, 2010, among the Borrower, BNP Paribas and
BNP Paribas Securities Corp.

     

    “Financial Officer”
means, for any Person, the chief financial officer, principal accounting
officer, treasurer or controller of such Person.  Unless otherwise
specified, all references herein to a Financial Officer means a Financial
Officer of the Parent.

     

    “Financial Statements”
means the financial statement or statements of the Parent and its Consolidated
Subsidiaries referred to in Section 7.04(a).

     

    “Foreign Lender” means
any Lender that is organized under the laws of a jurisdiction other than that in
which the Borrower is located.  For purposes of this definition, the
United States of America, each State thereof and the District of Columbia shall
be deemed to constitute a single jurisdiction, and Canada and each Province
thereof shall be deemed to constitute a single jurisdiction.

     

    “GAAP” means generally
accepted accounting principles in the United States of America as in effect from
time to time subject to the terms and conditions set forth in Section
1.05.

     

    “Governmental
Authority” means the government of the United States of America, Canada,
Colombia, the Cayman Islands, any other nation or any political subdivision
thereof, whether state, department, provincial or local, and any agency,
authority, instrumentality, regulatory body, court, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.

     

    “Governmental
Requirement” means any law, statute, code, ordinance, order,
determination, rule, regulation, judgment, decree, injunction, franchise,
permit, resolution, instruction, circular, certificate, license, rules of common
law, authorization or other directive or requirement, whether now or hereinafter
in effect, of any Governmental Authority.

     

    “Gran Tierra Energy
Colombia” means Gran Tierra Energy Colombia, Ltd., a limited partnership
organized under the laws of Utah.

     

    “Gran Tierra Exchangeco
Inc.” means Gran Tierra Exchangeco Inc., a corporation organized under
the laws of the Province of Alberta.

     

    “Guarantors” means (a)
the Parent, (b) each Material Subsidiary and (c) each Subsidiary (other than the
Borrower) that directly owns any Equity Interests in the Borrower or a Material
Subsidiary; provided that once a
Person is a Guarantor hereunder, such Person shall always be a Guarantor
hereunder even if such Person ceases to otherwise be a Guarantor under this
definition.

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    “Guaranty Agreement”
means an agreement executed by the Guarantors in form and substance satisfactory
to the Administrative Agent, unconditionally guarantying on a joint and several
basis, payment of the Indebtedness, as the same may be amended, modified or
supplemented from time to time.

     

    “Hazardous Material”
means any substance regulated or as to which liability might arise under any
applicable Environmental Law including:  (a) any chemical, compound,
material, product, byproduct, substance or waste defined as or included in the
definition or meaning of “hazardous substance,” “hazardous material,” “hazardous
waste,” “solid waste,” “toxic waste,” “extremely hazardous substance,” “toxic
substance,” “contaminant,” “pollutant,” or words of similar meaning or import
found in any applicable Environmental Law; (b) Hydrocarbons, petroleum products,
petroleum substances, natural gas, oil, oil and gas waste, crude oil, and any
components, fractions, or derivatives thereof; and (c) radioactive materials,
explosives, asbestos or asbestos containing materials, polychlorinated
biphenyls, radon, infectious or medical wastes.

     

    “Highest Lawful Rate”
means, with respect to each Lender, the maximum nonusurious interest rate, if
any, that at any time or from time to time may be contracted for, taken,
reserved, charged or received on the Notes, the Colombian Notes or on other
Indebtedness under laws applicable to such Lender which are presently in effect
or, to the extent allowed by law, under such applicable laws which may hereafter
be in effect and which allow a higher maximum nonusurious interest rate than
applicable laws allow as of the date hereof.

     

    “Hydrocarbon
Interests” means all rights, titles, interests and estates now or
hereafter acquired in and to (a) Hydrocarbon reserves from which Hydrocarbons
may or may potentially be severed or extracted, whether directly or indirectly,
including, without limitation, by virtue of any Concession Agreement, similar
arrangement or otherwise and (b) any Concession Agreement, oil and gas leases,
oil, gas and mineral leases, or other liquid or gaseous hydrocarbon leases,
mineral fee interests, overriding royalty and royalty interests, net profit
interests and production payment interests, including any reserved or residual
interests of whatever nature.

     

    “Hydrocarbons” means
oil, gas, casinghead gas, drip gasoline, natural gasoline, condensate,
distillate, liquid hydrocarbons, gaseous hydrocarbons and all products refined
or separated therefrom.

     

    “Indebtedness” means
any and all amounts owing or to be owing by any Credit Party (whether direct or
indirect (including those acquired by assumption), absolute or contingent, due
or to become due, now existing or hereafter arising): (a) to the Administrative
Agent, the Global Coordinator, the Issuing Bank, the Arranger or any Lender
under any Loan Document; (b) to any Secured Swap Party under any Secured Swap
Agreement; and (c) all renewals, extensions and/or rearrangements of any of the
above.

     

    “Indemnified Taxes”
means Taxes other than Excluded Taxes.

     

    “Initial Reserve
Report” means the report of GLJ Petroleum
Consultants Ltd. dated as of December 31, 2009,
with respect to the Colombian Hydrocarbon Properties as of December 31,
2009.

     

    “Interest Election
Request” means a request by the Borrower to convert or continue a
Borrowing in accordance with Section 2.04.

     

    “Interest Payment
Date” means (a) with respect to any ABR Loan, the last day of each March,
June, September and December and (b) with respect to any Eurodollar Loan, the
last day of the Interest Period applicable to the Borrowing of which such Loan
is a part.

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    “Interest Period”
means with respect to any Eurodollar Borrowing, the period commencing on the
date of such Borrowing and ending on the numerically corresponding day in the
calendar month that is three months thereafter; provided that (a) if
any Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (b) any
Interest Period pertaining to a Eurodollar Borrowing that commences on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the last calendar month of such Interest Period) shall end
on the last Business Day of the last calendar month of such Interest
Period.  For purposes hereof, the date of a Borrowing initially shall
be the date on which such Borrowing is made and thereafter shall be the
effective date of the most recent conversion or continuation of such
Borrowing.

     

    “Interest Rate Protection
Agreement” means any interest rate swap, cap or collar agreement or
similar arrangement providing for the transfer or mitigation of interest risks,
either generally or under specific contingencies.

     

    “Interim
Redetermination” has the meaning assigned such term in Section
2.07(b).

     

    “Interim Redetermination
Date” means the date on which a Borrowing Base that has been redetermined
pursuant to an Interim Redetermination becomes effective as provided in Section
2.07(d).

     

    “Investment” means,
for any Person: (a) the acquisition (whether for cash, Property, services or
securities or otherwise) of Equity Interests of any other Person or any
agreement to make any such acquisition (including, without limitation, any
“short sale” or any sale of any securities at a time when such securities are
not owned by the Person entering into such short sale); (b) the making of any
deposit with, or advance, loan or capital contribution to, assumption of Debt
of, purchase or other acquisition of any other Debt or equity participation or
interest in, or other extension of credit to, any other Person (including the
purchase of Property from another Person subject to an understanding or
agreement, contingent or otherwise, to resell such Property to such Person, but
excluding any such advance, loan or extension of credit having a term not
exceeding ninety (90) days representing the purchase price of inventory or
supplies sold by such Person in the ordinary course of business); (c) the
purchase or acquisition (in one or a series of transactions) of Property of
another Person that constitutes a business unit; or (d) the entering into of any
guarantee of, or other contingent obligation (including the deposit of any
Equity Interests to be sold) with respect to, Debt or other liability of any
other Person and (without duplication) any amount committed to be advanced, lent
or extended to such Person.

     

    “Issuing Bank”
means BNP
Paribas, in its capacity as the issuer of Letters of Credit hereunder,
and its successors in such capacity.  The Issuing Bank may, in its
discretion, arrange for one or more Letters of Credit to be issued by Affiliates
of the Issuing Bank, in which case the term “Issuing Bank” shall
include any such Affiliate with respect to Letters of Credit issued by such
Affiliate.

     

    “LC Commitment” at any
time means $20,000,000.

     

    “LC Disbursement”
means a payment made by the Issuing Bank pursuant to a Letter of
Credit.

     

    “LC Exposure” means,
at any time, the sum of (a) the aggregate undrawn amount of all outstanding
Letters of Credit at such time plus (b) the aggregate amount of all LC
Disbursements that have not yet been reimbursed by or on behalf of the Borrower
at such time.  The LC Exposure of any Lender at any time shall be its
Applicable Percentage of the total LC Exposure at such time.

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    “Lenders” means the
Persons listed on Annex I and any
Person that shall have become a party hereto pursuant to an Assignment and
Assumption, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Assumption.

     

    “Letter of Credit”
means any letter of credit issued pursuant to this Agreement.

     

    “Letter of Credit
Agreements” means all letter of credit applications and other agreements
(including any amendments, modifications or supplements thereto) submitted by
the Borrower, or entered into by the Borrower, with the Issuing Bank relating to
any Letter of Credit.

     

    “LIBO Rate” means,
with respect to any Eurodollar Borrowing for any Interest Period, the rate
appearing on Reuters Screen LIBOR01 Page (or on any successor or substitute page
of such service, or any successor to or substitute for such service, providing
rate quotations comparable to those currently provided on such page of such
service, as determined by the Administrative Agent from time to time for
purposes of providing quotations of interest rates applicable to US Dollar
deposits in the London interbank market) at approximately 11:00 a.m., London
time, two Business Days prior to the commencement of such Interest Period, as
the rate for US Dollar deposits with a maturity comparable to such Interest
Period.  In the event that such rate is not available at such time for
any reason, then the “LIBO Rate” with respect to such Eurodollar Borrowing for
such Interest Period shall be the rate (rounded upwards, if necessary, to the
next 1/100 of 1%) at which US Dollar deposits of an amount comparable to such
Eurodollar Borrowing and for a maturity comparable to such Interest Period are
offered by the principal London office of the Administrative Agent in
immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period.

     

    “Lien” means any
interest in Property securing an obligation owed to, or a claim by, a Person
other than the owner of the Property, whether such interest is based on the
common law, statute or contract, and whether such obligation or claim is fixed
or contingent, and including but not limited to (a) the lien or security
interest arising from a mortgage, encumbrance, pledge, hypothecation,
antichresis, usufruct, security agreement, conditional sale, deed of trust,
assignment in trust, or trust receipt or a lease, consignment or bailment for
security purposes or (b) production payments and the like payable out of Oil and
Gas Properties.  The term “Lien” shall include
easements, restrictions, servitudes, permits, conditions, covenants, exceptions
or reservations. For the purposes of this Agreement, the Parent and each
Subsidiary shall be deemed to be the owner of any Property which it has acquired
or holds subject to a conditional sale agreement, or leases under a financing
lease or other arrangement pursuant to which title to the Property has been
retained by or vested in some other Person in a transaction intended to create a
financing.

     

    “Loan Documents” means
this Agreement, the Notes, the Colombian Notes, the Letter of Credit Agreements,
the Letters of Credit, the Security Instruments and the Fee Letter.

     

    “Loans” means the
loans made by the Lenders to the Borrower pursuant to this
Agreement.

     

    “Majority Lenders”
means, at any time while no Loans or LC Exposure is outstanding, Non-Defaulting
Lenders having at least sixty-six and two-thirds percent (66-2/3%) of the
Aggregate Maximum Credit Amounts of all Non-Defaulting Lenders; and at any time
while any Loans or LC Exposure is outstanding, Non-Defaulting Lenders holding at
least sixty-six and two-thirds percent (66-2/3%) of the outstanding aggregate
principal amount of the Loans and participation interests in Letters of Credit
of all Non-Defaulting Lenders (without regard to any sale by a Non-Defaulting
Lender of a participation in any Loan under Section 12.04(c)).

    
      
         

      

      
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    “Material Adverse
Effect” means a material adverse change in, or material adverse effect on
(a) the business, operations, Property or condition (financial or otherwise) of
the Credit Parties taken as a whole, (b) the ability of any Credit Party to
perform any of its obligations under any Loan Document, (c) the validity or
enforceability of any Loan Document or (d) the rights and remedies of or
benefits available to the Administrative Agent, any other Agent, the Issuing
Bank or any Lender under any Loan Document.

     

    “Material Documents”
means, collectively, each Offtake Agreement, each Concession Agreement, and each
Swap Agreement to which any Credit Party is a party.

     

    “Material
Indebtedness” means Debt (other than the Loans and Letters of Credit), or
obligations in respect of one or more Swap Agreements, of any one or more of the
Credit Parties in an aggregate principal amount exceeding $2,000,000.  For
purposes of determining Material Indebtedness, the “principal amount” of the
obligations of any Credit Party in respect of any Swap Agreement at any time
shall be the Swap Termination Value.

     

    “Material Subsidiary”
means (a) Solana Petroleum Exploration, (b) Gran Tierra Energy Colombia, (c) as
of any date of determination, any Subsidiary that (i) owns or has an interest in
any Property assigned value in the Borrowing Base then in effect, as determined
by the Administrative Agent, or (ii) does business in Colombia, and (d) from and
after the date on which the amount of the Borrowing Base first exceeds
$20,000,000 (even if the amount of the Borrowing Base subsequently falls to or
below $20,000,000), any Subsidiary that at any time owns or has an interest in
Oil and Gas Properties that have produced Hydrocarbons at any time since such
date (even if such Subsidiary subsequently ceases to own or have an interest in
such Oil and Gas Properties or such production subsequently ceases); provided that the
term “Material
Subsidiary” shall not include (i) the Borrower or (ii) any Subsidiary
that would constitute a “Material Subsidiary” under clause (d) above solely as a
result of the ownership of or interest in Oil and Gas Properties located in
Argentina.

     

    “Maturity Date” means
the date that is the third anniversary of the Effective Date.

     

    “Maximum Credit
Amount” means, as to each Lender, the amount set forth opposite such
Lender’s name on Annex
I under the caption “Maximum Credit Amounts”, as the same may be (a)
reduced or terminated from time to time in connection with a reduction or
termination of the Aggregate Maximum Credit Amounts pursuant to Section 2.06(b)
or (b) modified from time to time pursuant to any assignment permitted by
Section 12.04(b).

     

    “Moody’s” means
Moody’s Investors Service, Inc. and any successor thereto that is a nationally
recognized rating agency.

     

    “Mortgaged Property”
means any Property owned by any Credit Party which is subject to the Liens
existing and to exist under the terms of the Security Instruments.

     

    “New Borrowing Base
Notice” has the meaning assigned such term in Section
2.07(d).

     

     

    “Non-Defaulting
Lenders” means, at any time, each Lender that is not a Defaulting Lender
at such time.

    

    “Notes” means the
promissory notes of the Borrower described in Section 2.02(d) and being
substantially in the form of Exhibit A, together
with all amendments, modifications, replacements, extensions and rearrangements
thereof.

     

    “Offtaker” means each
Eligible Buyer.

    
      
         

      

      
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    “Offtake Agreements”
means, collectively, (a) each agreement entered into between any Credit Party
and an Offtaker that is listed on Schedule 1.02(c); and
(b) any other purchase agreement entered into between any Credit Party and an
Offtaker that (i) provides for the purchase by such Offtaker of Hydrocarbons
from such Credit Party, (ii) is in form and substance reasonably satisfactory to
the Administrative Agent and (iii) further provides, to the Administrative
Agent’s satisfaction, that all payments thereunder shall be made to the relevant
Collection Account, as each such agreement may be amended, restated,
supplemented, replaced or otherwise modified in accordance with this
Agreement.

     

    “Oil and Gas
Properties” means (a) Hydrocarbon Interests; (b) the Properties now or
hereafter pooled or unitized with Hydrocarbon Interests; (c) all presently
existing or future unitization, pooling agreements and declarations of pooled
units and the units created thereby (including without limitation all units
created under orders, regulations and rules of any Governmental Authority) which
may affect all or any portion of the Hydrocarbon Interests; (d) all
operating agreements, contracts and other agreements, including production
sharing contracts and agreements, which relate to any of the Hydrocarbon
Interests or the production, sale, purchase, exchange or processing of
Hydrocarbons from or attributable to such Hydrocarbon Interests (including,
without limitation, all Concession Agreements and Offtake Agreements); (e) all
Hydrocarbons in and under and which may be produced and saved or attributable to
the Hydrocarbon Interests, including all oil in tanks, and all rents, issues,
profits, proceeds, products, revenues and other incomes from or attributable to
the Hydrocarbon Interests; (f) all tenements, hereditaments, appurtenances and
Properties in any manner appertaining, belonging, affixed or incidental to the
Hydrocarbon Interests; and (g) all Properties, rights, titles, interests and
estates described or referred to above, including any and all Property, real or
personal, now owned or hereinafter acquired and situated upon, used, held for
use or useful in connection with the operating, working or development of any of
such Hydrocarbon Interests or Property (excluding drilling rigs, automotive
equipment, rental equipment or other personal Property which may be on such
premises for the purpose of drilling a well or for other similar temporary uses)
and including any and all oil wells, gas wells, injection wells or other wells,
buildings, structures, fuel separators, liquid extraction plants, plant
compressors, pumps, pumping units, field gathering systems, tanks and tank
batteries, fixtures, valves, fittings, machinery and parts, engines, boilers,
meters, apparatus, equipment, appliances, tools, implements, cables, wires,
towers, casing, tubing and rods, surface leases, rights-of-way, easements and
servitudes together with all additions, substitutions, replacements, accessions
and attachments to any and all of the foregoing.

     

    “Other Taxes” means
any and all present or future stamp or documentary taxes or any other excise or
Property taxes, charges or similar levies arising from any payment made
hereunder or from the execution, delivery or enforcement of, or otherwise with
respect to, this Agreement and any other Loan Document.

     

    “Participant” has the
meaning set forth in Section 12.04(c)(i).

     

    “Person” means any
natural person, corporation, limited liability company, trust, joint venture,
association, company, partnership, Governmental Authority or other
entity.

     

    “Prime Rate” means the
rate of interest per annum publicly announced from time to time by BNP Paribas as
its prime rate in effect at its principal office in New York City; each change
in the Prime Rate shall be effective from and including the date such change is
publicly announced as being effective.  Such rate is set by the
Administrative Agent as a general reference rate of interest, taking into
account such factors as the Administrative Agent may deem appropriate; it being
understood that many of the Administrative Agent’s commercial or other loans are
priced in relation to such rate, that it is not necessarily the lowest or best
rate actually charged to any customer and that the Administrative Agent may make
various commercial or other loans at rates of interest having no relationship to
such rate.

    
      
         

      

      
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    “Property” means any
interest in any kind of property or asset, whether real, personal or mixed, or
tangible or intangible, including, without limitation, cash, securities,
accounts and contract rights.

     

    “Proposed Borrowing
Base” has the meaning assigned to such term in Section
2.07(c)(i).

     

    “Proposed Borrowing Base
Notice” has the meaning assigned to such term in Section
2.07(c)(ii).

     

    “Redemption” means
with respect to any Debt, the repurchase, redemption, prepayment, repayment,
defeasance or any other acquisition or retirement for value (or the segregation
of funds with respect to any of the foregoing) of such Debt.  “Redeem” has the
correlative meaning thereto.

     

    “Redetermination Date”
means, with respect to any Scheduled Redetermination or any Interim
Redetermination, the date that the redetermined Borrowing Base related thereto
becomes effective pursuant to Section 2.07(d).

     

    “Register” has the
meaning assigned such term in Section 12.04(b)(iv).

     

    “Regulation D” means
Regulation D of the Board, as the same may be amended, supplemented or replaced
from time to time.

     

    “Related Parties”
means, with respect to any specified Person, such Person’s Affiliates and the
respective directors, officers, employees, agents and advisors (including
attorneys, accountants and experts) of such Person and such Person’s
Affiliates.

     

    “Release” means any
depositing, spilling, leaking, pumping, pouring, placing, emitting, discarding,
abandoning, emptying, discharging, migrating, injecting, escaping, leaching,
dumping, or disposing.

     

    “Remedial Work” has
the meaning assigned such term in Section 8.10(a).

     

    “Reserve Report” means
a report, in form and substance reasonably satisfactory to the Administrative
Agent, setting forth, as of each December 31 or July 1 (or such other date in
the event of an Interim Redetermination) the oil and gas reserves attributable
to the Oil and Gas Properties of the Credit Parties, together with a projection
of the rate of production and future net income, taxes, royalties, operating
expenses, production sharing volumes and capital expenditures with respect
thereto as of such date, based upon the economic assumptions consistent with the
Administrative Agent’s lending requirements at the time.

     

    “Responsible Officer”
means, as to any Person, the Chief Executive Officer, the President, any
Financial Officer or any Vice President of such Person.  Unless
otherwise specified, all references to a Responsible Officer herein means a
Responsible Officer of the Parent.

     

    “Restricted Payment”
means any dividend or other distribution (whether in cash, securities or other
Property) with respect to any Equity Interests in any Credit Party, or any
payment (whether in cash, securities or other Property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any such Equity Interests in any
Credit Party or any option, warrant or other right to acquire any such Equity
Interests in any Credit Party.

     

    “Revolving Credit
Exposure” means, with respect to any Lender at any time, the sum of the
outstanding principal amount of such Lender’s Loans and its LC Exposure at such
time.

    
      
         

      

      
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    “Scheduled
Redetermination” has the meaning assigned such term in Section
2.07(b).

     

    “Scheduled Redetermination
Date” means the date on which a Borrowing Base that has been redetermined
pursuant to a Scheduled Redetermination becomes effective as provided in Section
2.07(d).

     

    “SEC” means the
Securities and Exchange Commission or any successor Governmental
Authority.

     

    “Secured Parties”
means each Lender, the Issuing Bank, the Bookrunner, the Arranger, the
Administrative Agent, the Global Coordinator and each Secured Swap
Party.

     

    “Secured Swap
Agreement” means any Swap Agreement between the Parent or any Subsidiary
and any Secured Swap Party regardless of when such Swap Agreement was entered
into, other than any such Swap Agreement entered into at any time after such
Secured Swap Party ceases to be a Lender (or affiliated with a
Lender).

    

    “Secured Swap
Obligations” means Indebtedness of the type referred to in clause (b) of
the definition of Indebtedness.

    

    “Secured Swap Party”
means any Person that is a Lender or an Affiliate of a Lender; provided that if such
Person ceases to be a Lender (or an Affiliate of a Lender), such Person shall
remain a “Secured Swap Party” during the period commencing on the date such
Person ceases to be a Lender (or an Affiliate of a Lender) through and including
the date that is thirty (30) days thereafter.

     

    “Security Instruments”
means, collectively, the Guaranty Agreement, the Colombian Security Documents,
the Cayman Security Documents, the Canadian Security Documents, the Deposit
Account Control Agreement (Gran Tierra Energy Colombia), the Deposit Account
Control Agreement (Solana Petroleum Exploration), mortgages, deeds of trust and
other agreements, instruments or certificates described or referred to in Exhibit E, and any
and all other agreements, documents, pledges, instruments, Deposit Account
Control Agreements, consents or certificates now or hereafter executed and
delivered by any Credit Party or any other Person (other than Secured Swap
Agreements or participation or similar agreements between any Lender and any
other lender or creditor with respect to any Indebtedness pursuant to this
Agreement) in connection with, or as security for the payment or performance of
the Indebtedness, the Notes, the Colombian Notes, this Agreement, or
reimbursement obligations under the Letters of Credit, as such agreements may be
amended, modified, supplemented or restated from time to time.

     

    “S&P” means
Standard & Poor’s Ratings Group, a division of The McGraw-Hill Companies,
Inc., and any successor thereto that is a nationally recognized rating
agency.

     

    “Solana Petroleum
Exploration” means Solana Petroleum Exploration (Colombia) Limited, an
exempted company incorporated with limited liability under the laws of the
Cayman Islands with registration number CR-81572.

     

    “Statutory Reserve
Rate” means a fraction (expressed as a decimal), the numerator of which
is the number one and the denominator of which is the number one minus the
aggregate of the maximum reserve percentages (including any marginal, special,
emergency or supplemental reserves) expressed as a decimal established by the
Board to which the Administrative Agent is subject with respect to the Adjusted
LIBO Rate, for eurocurrency funding (currently referred to as “Eurocurrency
Liabilities” in Regulation D of the Board).  Such reserve percentages
shall include those imposed pursuant to such Regulation D.  Eurodollar
Loans shall be deemed to constitute eurocurrency funding and to be subject to
such reserve requirements without benefit of or credit for proration, exemptions
or offsets that may be available from time to time to any Lender under such
Regulation D or any comparable regulation.  The Statutory Reserve Rate
shall be adjusted automatically on and as of the effective date of any change in
any reserve percentage.

    
      
         

      

      
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    “subsidiary” means,
with respect to any Person (the “parent”) at any date,
any other Person the accounts of which would be consolidated with those of the
parent in the parent’s consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other Person (a) of which Equity Interests representing more than 50% of the
equity or more than 50% of the ordinary voting power (irrespective of whether or
not at the time Equity Interests of any other class or classes of such Person
shall have or might have voting power by reason of the happening of any
contingency) or, in the case of a partnership, any general partnership interests
are, as of such date, owned, controlled or held, or (b) that is, as of such
date, otherwise Controlled, by the parent or one or more subsidiaries of the
parent or by the parent and one or more subsidiaries of the parent.

     

    “Subsidiary” means any
subsidiary of the Parent (including the Borrower); provided that (a)
each Colombian Branch shall be deemed to be a Subsidiary for all purposes
hereof; and (b) as used herein, the phrase “Subsidiary of the Borrower” shall
refer to a subsidiary of the Borrower.

     

    “Subsidiary Guarantor”
means each Guarantor other than the Parent.

     

    “Swap Agreement” means
any agreement with respect to any swap, forward, future or derivative
transaction or option or similar agreement, whether exchange traded,
“over-the-counter” or otherwise, involving, or settled by reference to, one or
more rates, currencies, commodities, equity or debt instruments or securities,
or economic, financial or pricing indices or measures of economic, financial or
pricing risk or value or any similar transaction or any combination of these
transactions, including, without limitation, any Interest Rate Protection
Agreement, Commodity Hedging Agreement or Currency Exchange Agreement; provided that no
phantom stock or similar plan providing for payments only on account of services
provided by current or former directors, officers, employees or consultants of
any Credit Party shall be a Swap Agreement.

     

    “Swap Termination
Value” means, in respect of any one or more Swap Agreements, after taking
into account the effect of any legally enforceable netting agreement relating to
such Swap Agreements, (a) for any date on or after the date such Swap Agreements
have been closed out and termination value(s) determined in accordance
therewith, such termination value(s) and (b) for any date prior to the date
referenced in clause (a), the amount(s) determined as the mark-to-market
value(s) for such Swap Agreements, as determined by the counterparties to such
Swap Agreements.

     

    “Synthetic Leases”
means, in respect of any Person, all leases which shall have been, or should
have been, in accordance with GAAP, treated as operating leases on the financial
statements of the Person liable (whether contingently or otherwise) for the
payment of rent thereunder and which were properly treated as indebtedness for
borrowed money for purposes of U.S. federal income taxes, if the lessee in
respect thereof is obligated to either purchase for an amount in excess of, or
pay upon early termination an amount in excess of, 80% of the residual value of
the Property subject to such operating lease upon expiration or early
termination of such lease.

     

    “Taxes” means any and
all present or future taxes, levies, imposts, duties, deductions, charges or
withholdings imposed by any Governmental Authority, including, without
limitation, any and all withholding taxes imposed by any Governmental Authority
of Canada.

    
      
         

      

      
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    “Termination Date”
means the earlier of the Maturity Date and the date of termination of the
Commitments.

     

    “Total Debt” means, at
any date, all Debt of the Parent and the Consolidated Subsidiaries on a
consolidated basis.

     

    “Transactions” means,
with respect to (a) the Borrower, the execution, delivery and performance by the
Borrower of this Agreement, each other Loan Document and each Material Document
to which it is a party, the borrowing of Loans, the use of the proceeds thereof
and the issuance of Letters of Credit hereunder, and the grant of Liens by the
Borrower on Mortgaged Properties and other Properties pursuant to the Security
Instruments; and (b) each Guarantor, the execution, delivery and performance by
such Guarantor of each Loan Document and each Material Document to which it is a
party, the guaranteeing of the Indebtedness and the other obligations under the
Guaranty Agreement by such Guarantor and such Guarantor’s grant of the security
interests and provision of Collateral under the Security Instruments, and the
grant of Liens by such Guarantor on Mortgaged Properties and other Properties
pursuant to the Security Instruments.

     

    “Type”, when used in
reference to any Loan or Borrowing, refers to whether the rate of interest on
such Loan, or on the Loans comprising such Borrowing, is determined by reference
to the Alternate Base Rate or the Adjusted LIBO Rate.

     

    “Unrestricted
Subsidiary” means any Subsidiary (other than the Borrower) that is not a
Subsidiary Guarantor.

     

    “US Dollars” or “$” refers to lawful
money of the United States of America.

     

    “USA Patriot Act”
means the Uniting and Strengthening America by Providing Appropriate Tools
Required to Intercept and Obstruct Terrorism Act of 2001, Pub. L. 107-56, signed
into law October 26, 2001, as amended from time to time.

     

    “Wholly-Owned
Subsidiary” means (a) any Subsidiary of which all of the outstanding
Equity Interests (other than any directors’ qualifying shares mandated by
applicable law), on a fully-diluted basis, are owned by the Parent or one or
more of the Wholly-Owned Subsidiaries or are owned by the Parent and one or more
of the Wholly-Owned Subsidiaries or (b) any Subsidiary that is organized in a
foreign jurisdiction and is required by the applicable laws and regulations of
such foreign jurisdiction to be partially owned by the government of such
foreign jurisdiction or individual or corporate citizens of such foreign
jurisdiction, provided that the
Parent, directly or indirectly, owns the remaining Equity Interests in such
Subsidiary and, by contract or otherwise, controls the management and business
of such Subsidiary and derives economic benefits of ownership of such Subsidiary
to substantially the same extent as if such Subsidiary were a Wholly-Owned
Subsidiary.

     

    Section
1.03     Types of Loans and
Borrowings.  For purposes of this Agreement, Loans and
Borrowings, respectively, may be classified and referred to by Type (e.g., a
“Eurodollar
Loan” or a “Eurodollar
Borrowing”).

    
      
         

      

      
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    Section
1.04      Terms Generally; Rules of
Construction.  The definitions of terms herein shall apply
equally to the singular and plural forms of the terms
defined.  Whenever the context may require, any pronoun shall include
the corresponding masculine, feminine and neuter forms.  The words
“include”, “includes” and “including” as used in this Agreement shall be deemed
to be followed by the phrase “without limitation”.  The word “will”
shall be construed to have the same meaning and effect as the word
“shall”.  Unless the context requires otherwise (a) any definition of
or reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth in the
Loan Documents), (b) any reference herein to any law shall be construed as
referring to such law as amended, modified, codified or reenacted, in whole or
in part, and in effect from time to time, (c) any reference herein to any Person
shall be construed to include such Person’s successors and assigns (subject to
the restrictions contained in the Loan Documents), (d) the words “herein”,
“hereof” and “hereunder”, and words of similar import, shall be construed to
refer to this Agreement in its entirety and not to any particular provision
hereof, (e) with respect to the determination of any time period, the word
“from” means “from and including” and the word “to” means “to and including” and
(f) any reference herein to Articles, Sections, Annexes, Exhibits and Schedules
shall be construed to refer to Articles and Sections of, and Annexes, Exhibits
and Schedules to, this Agreement.  No provision of this Agreement or
any other Loan Document shall be interpreted or construed against any Person
solely because such Person or its legal representative drafted such
provision.

     

    Section
1.05      Accounting Terms and
Determinations; GAAP.  Unless otherwise specified herein, all
accounting terms used herein shall be interpreted, all determinations with
respect to accounting matters hereunder shall be made, and all financial
statements and certificates and reports as to financial matters required to be
furnished to the Administrative Agent or the Lenders hereunder shall be
prepared, in accordance with GAAP, applied on a basis consistent with the
Financial Statements except for changes in which the Parent’s independent
certified public accountants concur and which are disclosed to Administrative
Agent on the next date on which financial statements are required to be
delivered to the Lenders pursuant to Section 8.01(a); provided that, unless
the Borrower and the Majority Lenders shall otherwise agree in writing, no such
change shall modify or affect the manner in which compliance with the covenants
contained herein is computed such that all such computations shall be conducted
utilizing financial information presented consistently with prior
periods.

     

    ARTICLE
II

    The
Credits

     

    Section
2.01       Commitments.  Subject
to the terms and conditions set forth herein, each Lender agrees to make Loans
to the Borrower during the Availability Period in an aggregate principal amount
that will not result in (a) such Lender’s Revolving Credit Exposure exceeding
such Lender’s Commitment or (b) the total Revolving Credit Exposures exceeding
the total Commitments.  Within the foregoing limits and subject to the
terms and conditions set forth herein, the Borrower may borrow, repay and
reborrow the Loans.

     

    Section
2.02       Loans and
Borrowings.

     

    (a)        Borrowings; Several
Obligations.  Each Loan shall be made as part of a Borrowing
consisting of Loans made by the Lenders ratably in accordance with their
respective Commitments.  The failure of any Lender to make any Loan
required to be made by it shall not relieve any other Lender of its obligations
hereunder; provided that the
Commitments are several and no Lender shall be responsible for any other
Lender’s failure to make Loans as required.

     

    (b)        Types of
Loans.  Subject to Section 3.03, each Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request
in accordance herewith.  Each Lender at its option may make any
Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such
Lender to make such Loan; provided that any
exercise of such option shall not affect the obligation of the Borrower to repay
such Loan in accordance with the terms of this Agreement.

    
      
         

      

      
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    (c)        Minimum Amounts; Limitation
on Number of Borrowings.  At the commencement of each Interest
Period for any Eurodollar Borrowing, such Borrowing shall be in an aggregate
amount that is an integral multiple of $1,000,000 and not
less than $1,000,000.  At
the time that each ABR Borrowing is made, such Borrowing shall be in an
aggregate amount that is an integral multiple of $1,000,000 and not
less than $1,000,000; provided that,
notwithstanding the foregoing, an ABR Borrowing may be in an aggregate amount
that is equal to the entire unused balance of the total Commitments or that is
required to finance the reimbursement of an LC Disbursement as contemplated by
Section 2.08(e).  Borrowings of more than one Type may be outstanding
at the same time; provided that there
shall not at any time be more than a total of four (4) Eurodollar
Borrowings outstanding.  Notwithstanding any other provision of this
Agreement, the Borrower shall not be entitled to request, or to elect to convert
or continue, any Borrowing if the Interest Period requested with respect thereto
would end after the Maturity Date.

     

    (d)        Notes and Colombian
Notes.  The Loans made by each Lender shall be evidenced by a
single promissory note of the Borrower in substantially the form of Exhibit A, and a
single Colombian Note of the Borrower in form
and substance satisfactory to the Administrative Agent, dated, in the case of
(i) any Lender party hereto as of the date of this Agreement, as of the date of
this Agreement, or (ii) any Lender that becomes a party hereto pursuant to an
Assignment and Assumption, as of the effective date of the Assignment and
Assumption, payable to the order of such Lender in a principal amount equal to
its Maximum Credit Amount as in effect on such date, and otherwise duly
completed.  In the event that any Lender’s Maximum Credit Amount
increases or decreases for any reason (whether pursuant to Section 2.06, Section
12.04(a) or otherwise), the Borrower shall deliver or cause to be delivered on
the effective date of such increase or decrease, a new Note payable to the order
of such Lender in a principal amount equal to its Maximum Credit Amount after
giving effect to such increase or decrease, and otherwise duly
completed.  The date, amount, Type, interest rate and, if applicable,
Interest Period of each Loan made by each Lender, and all payments made on
account of the principal thereof, shall be recorded by such Lender on its books
for its Note, and, prior to any transfer, may be endorsed by such Lender on a
schedule attached to such Note, or any continuation thereof or on any separate
record maintained by such Lender.  Failure to make any such notation
or to attach a schedule shall not affect any Lender’s or the Borrower’s rights
or obligations in respect of such Loans or affect the validity of such transfer
by any Lender of its Note.  

     

    Section
2.03       Requests for
Borrowings.  To request a Borrowing, the Borrower shall notify
the Administrative Agent of such request by telephone (a) in the case of a
Eurodollar Borrowing, not later than 12:00 noon, New York City time, three
Business Days before the date of the proposed Borrowing or (b) in the case of an
ABR Borrowing, not later than 12:00 noon, New York City time, one Business Day
before the date of the proposed Borrowing; provided that no such
notice shall be required for any deemed request of an ABR Borrowing to finance
the reimbursement of an LC Disbursement as provided in Section
2.08(e).  Each such telephonic Borrowing Request shall be irrevocable
and shall be confirmed promptly by hand delivery or telecopy to the
Administrative Agent of a written Borrowing Request in substantially the form of
Exhibit B and
signed by the Borrower.  Each such telephonic and written Borrowing
Request shall specify the following information in compliance with Section
2.02:

     

    (i)           the
aggregate amount of the requested Borrowing;

     

    (ii)          the
date of such Borrowing, which shall be a Business Day;

     

    (iii)         whether
such Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing;

    
      
         

      

      
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    (iv)        in
the case of a Eurodollar Borrowing, the initial Interest Period to be applicable
thereto, which shall be a period of three months;

     

    (v)         the
amount of the then effective Borrowing Base, the current total Revolving Credit
Exposures (without regard to the requested Borrowing) and the pro forma total Revolving
Credit Exposures (giving effect to the requested Borrowing); and

     

    (vi)        the
location and number of the Borrower’s account to which funds are to be
disbursed, which shall comply with the requirements of Section
2.05.

     

    If no
election as to the Type of Borrowing is specified, then the requested Borrowing
shall be an ABR Borrowing.  If no Interest Period is specified with
respect to any requested Eurodollar Borrowing, then the Borrower shall be deemed
to have selected an Interest Period of three month’s duration.  Each
Borrowing Request shall constitute a representation that the amount of the
requested Borrowing shall not cause the total Revolving Credit Exposures to
exceed the total Commitments (i.e., the lesser of the
Aggregate Maximum Credit Amounts and the then effective Borrowing
Base).

     

    Promptly
following receipt of a Borrowing Request in accordance with this Section 2.03,
the Administrative Agent shall advise each Lender of the details thereof and of
the amount of such Lender’s Loan to be made as part of the requested
Borrowing.

     

    Section
2.04          Interest
Elections.

     

    (a)       
  Conversion
and Continuance.  Each Borrowing initially shall be of the Type
specified in the applicable Borrowing Request and, in the case of a Eurodollar
Borrowing, shall have an initial Interest Period as specified in such Borrowing
Request.  Thereafter, the Borrower may elect to convert such Borrowing
to a different Type or to continue such Borrowing, all as provided in this
Section 2.04.  The Borrower may elect different options with respect
to different portions of the affected Borrowing, in which case each such portion
shall be allocated ratably among the Lenders holding the Loans comprising such
Borrowing, and the Loans comprising each such portion shall be considered a
separate Borrowing.

     

    (b)     
    Interest Election
Requests.  To make an election pursuant to this Section 2.04,
the Borrower shall notify the Administrative Agent of such election by telephone
by the time that a Borrowing Request would be required under Section 2.03 if the
Borrower were requesting a Borrowing of the Type resulting from such election to
be made on the effective date of such election.  Each such telephonic
Interest Election Request shall be irrevocable and shall be confirmed promptly
by hand delivery or telecopy to the Administrative Agent of a written Interest
Election Request in substantially the form of Exhibit C and signed
by the Borrower.

     

    (c)      
    Information in Interest
Election Requests.  Each telephonic and written Interest
Election Request shall specify the following information in compliance with
Section 2.02:

     

    (i)          the
Borrowing to which such Interest Election Request applies and, if different
options are being elected with respect to different portions thereof, the
portions thereof to be allocated to each resulting Borrowing (in which case the
information to be specified pursuant to Sections 2.04(c)(ii) and (iii) shall be
specified for each resulting Borrowing);

     

    (ii)         the
effective date of the election made pursuant to such Interest Election Request,
which shall be a Business Day;

    
      
         

      

      
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    (iii)        whether
the resulting Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;
and

     

    (iv)        if
the resulting Borrowing is a Eurodollar Borrowing, the Interest Period to be
applicable thereto after giving effect to such election, which shall be a period
of three months.

     

    If any
such Interest Election Request requests a Eurodollar Borrowing but does not
specify an Interest Period, then the Borrower shall be deemed to have selected
an Interest Period of three month’s duration.

     

    (d)         Notice to Lenders by the
Administrative Agent.  Promptly following receipt of an
Interest Election Request, the Administrative Agent shall advise each Lender of
the details thereof and of such Lender’s portion of each resulting
Borrowing.

     

    (e)       
 Effect of
Failure to Deliver Timely Interest Election Request and Events of Default and
Borrowing Base Deficiencies on Interest Election.  If the
Borrower fails to deliver a timely Interest Election Request with respect to a
Eurodollar Borrowing prior to the end of the Interest Period applicable thereto,
then, unless such Borrowing is repaid as provided herein, at the end of such
Interest Period such Borrowing shall be converted to an ABR
Borrowing.  Notwithstanding any contrary provision hereof, if an Event
of Default or a Borrowing Base Deficiency has occurred and is
continuing:  (i) no outstanding Borrowing may be converted to or
continued as a Eurodollar Borrowing (and any Interest Election Request that
requests the conversion of any Borrowing to, or continuation of any Borrowing
as, a Eurodollar Borrowing shall be ineffective) and (ii) unless repaid, each
Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the
Interest Period applicable thereto.

     

    Section
2.05         Funding of
Borrowings.

     

    (a)      
  Funding by
Lenders.  Each Lender shall make each Loan to be made by it
hereunder on the proposed date thereof by wire transfer of immediately available
funds by 1:00 p.m., New York City time, to the account of the Administrative
Agent most recently designated by it for such purpose by notice to the
Lenders.  The Administrative Agent will make such Loans available to
the Borrower by promptly crediting the amounts so received, in like funds, to an
account of the Borrower maintained with the Administrative Agent in New York,
New York and designated by the Borrower in the applicable Borrowing Request;
provided that
ABR Loans made to finance the reimbursement of an LC Disbursement as provided in
Section 2.08(e) shall be remitted by the Administrative Agent to the Issuing
Bank.  Nothing herein shall be deemed to obligate any Lender to obtain
the funds for its Loan in any particular place or manner or to constitute a
representation by any Lender that it has obtained or will obtain the funds for
its Loan in any particular place or manner.

     

    (b)       
 Presumption of
Funding by the Lenders.  Unless the Administrative Agent shall
have received notice from a Lender prior to the proposed date of any Borrowing
that such Lender will not make available to the Administrative Agent such
Lender’s share of such Borrowing, the Administrative Agent may assume that such
Lender has made such share available on such date in accordance with Section
2.05(a) and may, in reliance upon such assumption, make available to the
Borrower a corresponding amount.  In such event, if a Lender has not
in fact made its share of the applicable Borrowing available to the
Administrative Agent, then the applicable Lender and the Borrower severally
agree to pay to the Administrative Agent forthwith on demand such corresponding
amount with interest thereon, for each day from and including the date such
amount is made available to the Borrower to but excluding the date of payment to
the Administrative Agent, at (i) in the case of such Lender, the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation or (ii) in
the case of the Borrower, the interest rate applicable to ABR
Loans.  If such Lender pays such amount to the Administrative Agent,
then such amount shall constitute such Lender’s Loan included in such
Borrowing.

    
      
         

      

      
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    Section
2.06         Termination and Reduction of
Aggregate Maximum Credit Amounts.

     

    (a)       
  Scheduled
Termination of Commitments.  Unless previously terminated, the
Commitments shall terminate on the Maturity Date.  If at any time the
Aggregate Maximum Credit Amounts or the Borrowing Base is terminated or reduced
to zero, then the Commitments shall terminate on the effective date of such
termination or reduction.

     

    (b)      
   Optional
Termination and Reduction of Aggregate Credit Amounts.

     

    (i)          The
Borrower may at any time terminate, or from time to time reduce, the Aggregate
Maximum Credit Amounts; provided that (A)
each reduction of the Aggregate Maximum Credit Amounts shall be in an amount
that is an integral multiple of $250,000 and not
less than $2,000,000 and (B)
the Borrower shall not terminate or reduce the Aggregate Maximum Credit Amounts
if, after giving effect to any concurrent prepayment of the Loans in accordance
with Section 3.04(c)(i), the total Revolving Credit Exposures would exceed the
total Commitments.

     

    (ii)         The
Borrower shall notify the Administrative Agent of any election to terminate or
reduce the Aggregate Maximum Credit Amounts under Section 2.06(b)(i) at least
three Business Days prior to the effective date of such termination or
reduction, specifying such election and the effective date
thereof.  Promptly following receipt of any notice, the Administrative
Agent shall advise the Lenders of the contents thereof.  Each notice
delivered by the Borrower pursuant to this Section 2.06(b)(ii) shall be
irrevocable.  Any termination or reduction of the Aggregate Maximum
Credit Amounts shall be permanent and may not be reinstated.  Each
reduction of the Aggregate Maximum Credit Amounts shall be made ratably among
the Lenders in accordance with each Lender’s Applicable Percentage.

     

    Section
2.07        Borrowing
Base.

     

    (a)      
  Initial
Borrowing Base.  For the period from and including the
Effective Date to but excluding the first Redetermination Date, the amount of
the Borrowing Base shall be $20,000,000.  Notwithstanding
the foregoing, the Borrowing Base may be subject to further adjustments from
time to time pursuant to Section 8.13 or Section 9.11(d).

     

    (b)         Scheduled and Interim
Redeterminations.  The Borrowing Base shall be redetermined
semi-annually in accordance with this Section 2.07 (a “Scheduled
Redetermination”), and, subject to Section 2.07(d), such redetermined
Borrowing Base shall become effective and applicable to the Borrower, the
Agents, the Issuing Bank and the Lenders on April 1st and October 1st of each
year, commencing October 1, 2010.  In
addition, the Borrower may, by notifying the Administrative Agent thereof, and
the Administrative Agent may, at the direction of the Majority Lenders, by
notifying the Borrower thereof, one time during any 12-month period, each elect
to cause the Borrowing Base to be redetermined between Scheduled
Redeterminations (an “Interim
Redetermination”) in accordance with this Section 2.07.

    
      
         

      

      
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    (c)         
Scheduled and
Interim  Redetermination Procedure.

     

    (i)          Each
Scheduled Redetermination and each Interim Redetermination shall be effectuated
as follows:  Upon receipt by the Administrative Agent of (A) the
Reserve Report and the certificate required to be delivered by the Borrower to
the Administrative Agent, in the case of a Scheduled Redetermination, pursuant
to Section 8.12(a) and (c), and, in the case of an Interim Redetermination,
pursuant to Section 8.12(b) and (c), and (B) such other reports, data and
supplemental information, including, without limitation, the information
provided pursuant to Section 8.12(c), as may, from time to time, be reasonably
requested by the Majority Lenders (the Reserve Report, such certificate and such
other reports, data and supplemental information being the “Engineering
Reports”), the Administrative Agent shall evaluate the information
contained in the Engineering Reports and shall, in good faith, propose a new
Borrowing Base (the “Proposed Borrowing
Base”) based upon such information and such other information (including,
without limitation, the status of title information with respect to the Oil and
Gas Properties as described in the Engineering Reports and the existence of any
other Debt) as the Administrative Agent deems appropriate in its sole discretion
and consistent with its normal oil and gas lending criteria as it exists at the
particular time.  In no event shall the Proposed Borrowing Base exceed
the Aggregate Maximum Credit Amounts.

     

    (ii)         The
Administrative Agent shall notify the Borrower and the Lenders of the Proposed
Borrowing Base (the “Proposed Borrowing Base
Notice”):

     

    (A)       in
the case of a Scheduled Redetermination (1) if the Administrative Agent shall
have received the Engineering Reports required to be delivered by the Borrower
pursuant to Sections 8.12(a) and (c) in a timely and complete manner, then on or
before the March 15th and September 15th of such year following the date of
delivery or (2) if the Administrative Agent shall not have received the
Engineering Reports required to be delivered by the Borrower pursuant to
Sections 8.12(a) and (c) in a timely and complete manner, then promptly after
the Administrative Agent has received complete Engineering Reports from the
Borrower and has had a reasonable opportunity to determine the Proposed
Borrowing Base in accordance with Section 2.07(c)(i); and

     

    (B)        in
the case of an Interim Redetermination, promptly, and in any event, within
fifteen (15) days after the Administrative Agent has received the required
Engineering Reports.

     

    (iii)         Any
Proposed Borrowing Base that would increase the Borrowing Base then in effect
must be approved or deemed to have been approved by all of the Lenders as
provided in this Section 2.07(c)(iii); and any Proposed Borrowing Base that
would decrease or maintain the Borrowing Base then in effect must be approved or
be deemed to have been approved by the Majority Lenders as provided in this
Section 2.07(c)(iii).  Upon receipt of the Proposed Borrowing Base
Notice, each Lender shall have fifteen (15) days to agree with the Proposed
Borrowing Base or disagree with the Proposed Borrowing Base by proposing an
alternate Borrowing Base.  If at the end of such fifteen (15) days,
any Lender has not communicated its approval or disapproval in writing to the
Administrative Agent, such silence shall be deemed to be an approval of the
Proposed Borrowing Base.  If, at the end of such 15-day period, all of
the Lenders, in the case of a Proposed Borrowing Base that would increase the
Borrowing Base then in effect, or the Majority Lenders, in the case of a
Proposed Borrowing Base that would decrease or maintain the Borrowing Base then
in effect, have approved or deemed to have approved, as aforesaid, then the
Proposed Borrowing Base shall become the new Borrowing Base, effective on the
date specified in Section 2.07(d).  If, however, at the end of such
15-day period, all of the Lenders or the Majority Lenders, as applicable, have
not approved or deemed to have approved, as aforesaid, then the Administrative
Agent shall poll the Lenders to ascertain the highest Borrowing Base then
acceptable to a number of Lenders sufficient to constitute the Majority Lenders
and, so long as such amount does not increase the Borrowing Base then in effect,
such amount shall become the new Borrowing Base, effective on the date specified
in Section 2.07(d).

    
      
         

      

      
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    (d)          Effectiveness of a
Redetermined Borrowing Base.  After a redetermined Borrowing
Base is approved or is deemed to have been approved by all of the Lenders or the
Majority Lenders, as applicable, pursuant to Section 2.07(c)(iii), the
Administrative Agent shall notify the Borrower and the Lenders of the amount of
the redetermined Borrowing Base (the “New Borrowing Base
Notice”), and such amount shall become the new Borrowing Base, effective
and applicable to the Borrower, the Administrative Agent, the Issuing Bank and
the Lenders:

     

    (i)           in
the case of a Scheduled Redetermination, (A) if the Administrative Agent shall
have received the Engineering Reports required to be delivered by the Borrower
pursuant to Sections 8.12(a) and (c) in a timely and complete manner, then on
the April 1st or October 1st, as applicable, following such notice, or (B) if
the Administrative Agent shall not have received the Engineering Reports
required to be delivered by the Borrower pursuant to Sections 8.12(a) and (c) in
a timely and complete manner, then on the Business Day next succeeding delivery
of such notice; and

     

    (ii)          in
the case of an Interim Redetermination, on the Business Day next succeeding
delivery of such notice.

     

    Such
amount shall then become the Borrowing Base until the next Scheduled
Redetermination Date, the next Interim Redetermination Date or the next
adjustment to the Borrowing Base under Section 8.13 or Section 9.11(d),
whichever occurs first.  Notwithstanding the foregoing, no Scheduled
Redetermination or Interim Redetermination shall become effective until the New
Borrowing Base Notice related thereto is received by the Borrower.

     

    (e)          Determinations;
Adjustments.  Notwithstanding any other provision of this
Agreement to the contrary, all determinations and redeterminations and
adjustments by the Administrative Agent (and any determinations and decisions by
each of the Lenders or the Majority Lenders in connection therewith, or in
connection with the provisions of Section 8.13 or Section 9.11(d), including any
thereof approving or disapproving a proposed redetermination or redetermination
by the Administrative Agent or effecting any adjustment to any element included
in a Reserve Report or the determination or redetermination of the Borrowing
Base) shall be made by any such Person as it deems appropriate in its sole
discretion and consistent with its normal oil and gas lending criteria as it
exists at the particular time, and any such determination, redetermination or
adjustment shall consider any other relevant information or factors, including
without limitation, any additional Debt or other obligations that have been
incurred or that the Parent and the Subsidiaries intend or expect to incur that
such Person may deem appropriate in its sole discretion.

     

    Section
2.08         Letters of
Credit.

     

    (a)          General.  Subject
to the terms and conditions set forth herein, the Borrower may request the
issuance of US Dollar denominated Letters of Credit for its own account or for
the account of any of its Subsidiaries, in a form reasonably acceptable to the
Administrative Agent and the Issuing Bank, at any time and from time to time
during the Availability Period; provided that the
Borrower may not request the issuance, amendment, renewal or extension of
Letters of Credit hereunder if a Borrowing Base Deficiency exists at such time
or would exist as a result thereof.  In the event of any inconsistency
between the terms and conditions of this Agreement and the terms and conditions
of any form of letter of credit application or other agreement submitted by the
Borrower to, or entered into by the Borrower with, the Issuing Bank relating to
any Letter of Credit, the terms and conditions of this Agreement shall
control.

     

    (b)          Notice of Issuance,
Amendment, Renewal, Extension; Certain Conditions.  To request
the issuance of a Letter of Credit (or the amendment, renewal or extension of an
outstanding Letter of Credit), the Borrower shall hand deliver or telecopy (or
transmit by electronic communication, if arrangements for doing so have been
approved by the Issuing Bank) to the Issuing Bank and the Administrative Agent
(not less than five (5) Business Days in advance of the requested date of
issuance, amendment, renewal or extension) a notice:

    
      
         

      

      
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    (i)           requesting
the issuance of a Letter of Credit or identifying the Letter of Credit to be
amended, renewed or extended;

     

    (ii)          specifying
the date of issuance, amendment, renewal or extension (which shall be a Business
Day);

     

    (iii)         specifying
the date on which such Letter of Credit is to expire (which shall comply with
Section 2.08(c));

     

    (iv)     
   specifying the amount of such Letter of Credit;

     

    (v)      
   specifying the name and address of the beneficiary thereof and
such other information as shall be necessary to prepare, amend, renew or extend
such Letter of Credit; and

     

    (vi)        specifying
the amount of the then effective Borrowing Base and whether a Borrowing Base
Deficiency exists at such time, the current total Revolving Credit Exposures
(without regard to the requested Letter of Credit or the requested amendment,
renewal or extension of an outstanding Letter of Credit) and the pro forma total Revolving
Credit Exposures (giving effect to the requested Letter of Credit or the
requested amendment, renewal or extension of an outstanding Letter of
Credit).

     

    Each
notice shall constitute a representation that after giving effect to the
requested issuance, amendment, renewal or extension, as applicable, (i) the LC
Exposure shall not exceed the LC Commitment and (ii) the total Revolving Credit
Exposures shall not exceed the total Commitments (i.e., the lesser of the
Aggregate Maximum Credit Amounts and the then effective Borrowing
Base).

     

    If
requested by the Issuing Bank, the Borrower also shall submit a letter of credit
application on the Issuing Bank’s standard form in connection with any request
for a Letter of Credit.

     

    (c)          Expiration
Date.  Each Letter of Credit shall expire at or prior to the
close of business on the date that is five Business Days prior to the Maturity
Date.

     

    (d)          Participations.  By
the issuance of a Letter of Credit (or an amendment to a Letter of Credit
increasing the amount thereof) and without any further action on the part of the
Issuing Bank or the Lenders, the Issuing Bank hereby grants to each Lender, and
each Lender hereby acquires from the Issuing Bank, a participation in such
Letter of Credit equal to such Lender’s Applicable Percentage of the aggregate
amount available to be drawn under such Letter of Credit.  In
consideration and in furtherance of the foregoing, each Lender hereby absolutely
and unconditionally agrees to pay to the Administrative Agent, for the account
of the Issuing Bank, such Lender’s Applicable Percentage of each LC Disbursement
made by the Issuing Bank and not reimbursed by the Borrower on the date due as
provided in Section 2.08(e), or of any reimbursement payment required to be
refunded to the Borrower for any reason.  Each Lender acknowledges and
agrees that its obligation to acquire participations pursuant to this Section
2.08(d) in respect of Letters of Credit is absolute and unconditional and shall
not be affected by any circumstance whatsoever, including any amendment, renewal
or extension of any Letter of Credit or the occurrence and continuance of a
Default, the existence of a Borrowing Base Deficiency or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever.

    
      
         

      

      
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    (e)          Reimbursement.  If
the Issuing Bank shall make any LC Disbursement in respect of a Letter of
Credit, the Borrower shall reimburse such LC Disbursement by paying to the
Administrative Agent an amount equal to such LC Disbursement not later than
12:00 noon, New York City time, on the date that such LC Disbursement is made,
if the Borrower shall have received notice of such LC Disbursement prior to
10:00 a.m., New York City time, on such date, or, if such notice has not been
received by the Borrower prior to such time on such date, then not later than
12:00 noon, New York City time, on (i) the Business Day that the Borrower
receives such notice, if such notice is received prior to 10:00 a.m., New York
City time, on the day of receipt, or (ii) the Business Day immediately following
the day that the Borrower receives such notice, if such notice is not received
prior to such time on the day of receipt; provided that if such
LC Disbursement is not less than $1,000,000, the Borrower shall, subject to the
conditions to Borrowing set forth herein, be deemed to have requested, and the
Borrower does hereby request under such circumstances, that such payment be
financed with an ABR Borrowing in an equivalent amount and, to the extent so
financed, the Borrower’s obligation to make such payment shall be discharged and
replaced by the resulting ABR Borrowing.  If the Borrower fails to
make such payment when due, the Administrative Agent shall notify each Lender of
the applicable LC Disbursement, the payment then due from the Borrower in
respect thereof and such Lender’s Applicable Percentage
thereof.  Promptly following receipt of such notice, each Lender shall
pay to the Administrative Agent its Applicable Percentage of the payment then
due from the Borrower, in the same manner as provided in Section 2.05 with
respect to Loans made by such Lender (and Section 2.05 shall apply, mutatis mutandis, to the
payment obligations of the Lenders), and the Administrative Agent shall promptly
pay to the Issuing Bank the amounts so received by it from the
Lenders.  Promptly following receipt by the Administrative Agent of
any payment from the Borrower pursuant to this Section 2.08(e), the
Administrative Agent shall distribute such payment to the Issuing Bank or, to
the extent that Lenders have made payments pursuant to this Section 2.08(e) to
reimburse the Issuing Bank, then to such Lenders and the Issuing Bank as their
interests may appear.  Any payment made by a Lender pursuant to this
Section 2.08(e) to reimburse the Issuing Bank for any LC Disbursement (other
than the funding of ABR Loans as contemplated above) shall not constitute a Loan
and shall not relieve the Borrower of its obligation to reimburse such LC
Disbursement.

     

    (f)           Obligations
Absolute.  The Borrower’s obligation to reimburse LC
Disbursements as provided in Section 2.08(e) shall be absolute, unconditional
and irrevocable, and shall be performed strictly in accordance with the terms of
this Agreement under any and all circumstances whatsoever and irrespective of
(i) any lack of validity or enforceability of any Letter of Credit, any Letter
of Credit Agreement or this Agreement, or any term or provision therein, (ii)
any draft or other document presented under a Letter of Credit proving to be
forged, fraudulent or invalid in any respect or any statement therein being
untrue or inaccurate in any respect, (iii) payment by the Issuing Bank under a
Letter of Credit against presentation of a draft or other document that does not
comply with the terms of such Letter of Credit or any Letter of Credit
Agreement, or (iv) any other event or circumstance whatsoever, whether or not
similar to any of the foregoing, that might, but for the provisions of this
Section 2.08(f), constitute a legal or equitable discharge of, or provide a
right of setoff against, the Borrower’s obligations
hereunder.  Neither the Administrative Agent, the Lenders nor the
Issuing Bank, nor any of their Related Parties shall have any liability or
responsibility by reason of or in connection with the issuance or transfer of
any Letter of Credit or any payment or failure to make any payment thereunder
(irrespective of any of the circumstances referred to in the preceding
sentence), or any error, omission, interruption, loss or delay in transmission
or delivery of any draft, notice or other communication under or relating to any
Letter of Credit (including any document required to make a drawing thereunder),
any error in interpretation of technical terms or any consequence arising from
causes beyond the control of the Issuing Bank; provided that the
foregoing shall not be construed to excuse the Issuing Bank from liability to
the Borrower to the extent of any direct damages (as opposed to consequential
damages, claims in respect of which are hereby waived by the Borrower to the
extent permitted by applicable law) suffered by the Borrower that are caused by
the Issuing Bank’s failure to exercise care when determining whether drafts and
other documents presented under a Letter of Credit comply with the terms
thereof.  The parties hereto expressly agree that, in the absence of
gross negligence or willful misconduct on the part of the Issuing Bank (as
finally determined by a court of competent jurisdiction), the Issuing Bank shall
be deemed to have exercised all requisite care in each such
determination.  In furtherance of the foregoing and without limiting
the generality thereof, the parties agree that, with respect to documents
presented which appear on their face to be in substantial compliance with the
terms of a Letter of Credit, the Issuing Bank may, in its sole discretion,
either accept and make payment upon such documents without responsibility for
further investigation, regardless of any notice or information to the contrary,
or refuse to accept and make payment upon such documents if such documents are
not in strict compliance with the terms of such Letter of
Credit.

    
      
         

      

      
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    (g)          Disbursement
Procedures.  The Issuing Bank shall, promptly following its
receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit.  The Issuing Bank shall promptly
notify the Administrative Agent and the Borrower by telephone (confirmed by
telecopy) of such demand for payment and whether the Issuing Bank has made or
will make an LC Disbursement thereunder; provided that any
failure to give or delay in giving such notice shall not relieve the Borrower of
its obligation to reimburse the Issuing Bank and the Lenders with respect to any
such LC Disbursement.

     

    (h)          Interim
Interest.  If the Issuing Bank shall make any LC Disbursement,
then, until the Borrower shall have reimbursed the Issuing Bank for such LC
Disbursement (either with its own funds or a Borrowing under Section 2.08(e)),
the unpaid amount thereof shall bear interest, for each day from and including
the date such LC Disbursement is made to but excluding the date that the
Borrower reimburses such LC Disbursement, at the rate per annum then applicable
to ABR Loans.  Interest accrued pursuant to this Section 2.08(h) shall
be for the account of the Issuing Bank, except that interest accrued on and
after the date of payment by any Lender pursuant to Section 2.08(e) to reimburse
the Issuing Bank shall be for the account of such Lender to the extent of such
payment.

     

    (i)           Cash
Collateralization.

     

    (i)           If
(A) any Event of Default shall occur and be continuing and the Borrower receives
notice from the Administrative Agent or the Majority Lenders demanding that the
Borrower Cash Collateralize the outstanding LC Exposure pursuant to this Section
2.08(i), (B) the Borrower is required to Cash Collateralize the excess
attributable to an LC Exposure in connection with any prepayment pursuant to
Section 3.04(c), or (D) the Borrower is required to Cash Collateralize a
Defaulting Lender’s LC Exposure pursuant to Section 4.03(c)(iii)(B), then the
Borrower shall Cash Collateralize such LC Exposure or the excess attributable to
such LC Exposure, as the case may be, as of such date plus any accrued and
unpaid interest thereon; provided that the
obligation to Cash Collateralize pursuant to this Section 2.08(i) shall become
effective immediately, and the Borrower’s obligation to Cash Collateralize shall
become immediately due and payable, without demand or other notice of any kind,
upon the occurrence of any Event of Default described in Section 10.01(h) or
Section 10.01(i).

     

    (ii)          The
Borrower hereby grants to the Administrative Agent, for the benefit of the
Issuing Bank and the Lenders, an exclusive first priority and continuing
perfected security interest in and Lien on each account (a “Collateral Account”)
in which the Borrower has Cash Collateralized any obligation hereunder and all
cash, checks, drafts, certificates and instruments, if any, from time to time
deposited or held in such account, all deposits or wire transfers made thereto,
any and all investments purchased with funds deposited in such account, all
interest, dividends, cash, instruments, financial assets and other Property from
time to time received, receivable or otherwise payable in respect of, or in
exchange for, any or all of the foregoing, and all proceeds, products,
accessions, rents, profits, income and benefits therefrom, and any substitutions
and replacements therefor (collectively, the “Cash
Collateral”).

    
      
         

      

      
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    (iii)         The
Borrower’s obligation to Cash Collateralize pursuant to this Section 2.08(i)
shall be absolute and unconditional, without regard to whether any beneficiary
of any Letter of Credit has attempted to draw down all or a portion of such
amount under the terms of a Letter of Credit, and, to the fullest extent
permitted by applicable law, shall not be subject to any defense or be affected
by a right of set-off, counterclaim or recoupment which any Credit Party may now
or hereafter have against any such beneficiary, the Issuing Bank, the
Administrative Agent, the Lenders or any other Person for any reason
whatsoever.

     

    (iv)         Each
Collateral Account and all Cash Collateral shall secure the payment and
performance of the Credit Parties’ obligations under this Agreement and the
other Loan Documents.  The Administrative Agent shall have exclusive
dominion and control, including the exclusive right of withdrawal, over each
Collateral Account and the Cash Collateral.  Other than any interest
earned on the investment of such deposits, which investments shall be made at
the option and sole discretion of the Administrative Agent and at the Borrower’s
risk and expense, such deposits shall not bear interest.  Interest or
profits, if any, on such investments shall accumulate in each Collateral
Account.  Moneys in such account shall be applied by the
Administrative Agent to reimburse the Issuing Bank for LC Disbursements for
which it has not been reimbursed and, to the extent not so applied, shall be
held for the satisfaction of the reimbursement obligations of the Borrower for
the LC Exposure at such time or, if the maturity of the Loans has been
accelerated, be applied to satisfy other obligations of the Credit Parties under
this Agreement or the other Loan Documents.  If the Borrower is
required to Cash Collateralize hereunder as a result of the occurrence of an
Event of Default, and the Borrower is not otherwise required to pay to the
Administrative Agent the excess attributable to an LC Exposure in connection
with any prepayment pursuant to Section 3.04(c) or Cash Collateralize a
Defaulting Lender’s LC Exposure pursuant to Section 4.03(c)(iii)(B), then such
amount (to the extent not applied as aforesaid) shall be returned to the
Borrower within three Business Days after all Events of Default have been cured
or waived.

     

    ARTICLE
III

    Payments
of Principal and Interest; Prepayments; Fees

     

    Section
3.01         Repayment of
Loans.  The Borrower hereby unconditionally promises to pay to
the Administrative Agent for the account of each Lender the then unpaid
principal amount of each Loan on the Termination Date.

     

    Section
3.02         Interest.

     

    (a)          ABR
Loans.  The Loans comprising each ABR Borrowing shall bear
interest at the Alternate Base Rate plus the Applicable Margin, but in no event
to exceed the Highest Lawful Rate.

     

    (b)          Eurodollar
Loans.  The Loans comprising each Eurodollar Borrowing shall
bear interest at the Adjusted LIBO Rate for the Interest Period in effect for
such Borrowing plus the Applicable Margin, but in no event to exceed the Highest
Lawful Rate.

     

    (c)          Post-Default
Rate.  Notwithstanding the foregoing, if an Event of Default
has occurred and is continuing, or if any principal of or interest on any Loan
or any fee or other amount payable by any Credit Party hereunder or under any
other Loan Document is not paid when due, whether at stated maturity, upon
acceleration or otherwise, and including any payments in respect of a Borrowing
Base Deficiency under Section 3.04(c), then, upon notice thereof to the Borrower
from the Administrative Agent, all Loans outstanding, in the case of an Event of
Default, and such overdue amount, in the case of a failure to pay amounts when
due, shall bear interest, after as well as before judgment, at a rate per annum
equal to two percent (2%) plus the rate applicable to ABR Loans as provided in
Section 3.02(a), but in no event to exceed the Highest Lawful
Rate.

    
      
         

      

      
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    (d)          Interest Payment
Dates.  Accrued interest on each Loan shall be payable in
arrears on each Interest Payment Date for such Loan and on the Termination Date;
provided that
(i) interest accrued pursuant to Section 3.02(c) shall be payable on demand,
(ii) in the event of any repayment or prepayment of any Loan (other than an
optional prepayment of an ABR Loan prior to the Termination Date), accrued
interest on the principal amount repaid or prepaid shall be payable on the date
of such repayment or prepayment, and (iii) in the event of any conversion of any
Eurodollar Loan prior to the end of the current Interest Period therefor,
accrued interest on such Loan shall be payable on the effective date of such
conversion.

     

    (e)          Interest Rate
Computations.  All interest hereunder shall be computed on the
basis of a year of 360 days, unless such computation would exceed the Highest
Lawful Rate, in which case interest shall be computed on the basis of a year of
365 days (or 366 days in a leap year), except that interest computed by
reference to the Alternate Base Rate at times when the Alternate Base Rate is
based on the Prime Rate shall be computed on the basis of a year of 365 days (or
366 days in a leap year), and in each case shall be payable for the actual
number of days elapsed (including the first day but excluding the last
day).  The applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO
Rate shall be determined by the Administrative Agent, and such determination
shall be conclusive absent manifest error, and be binding upon the parties
hereto.

     

    For
purposes of disclosure pursuant to the Interest Act (Canada), the
annual rates of interest or fees to which the rates of interest or fees provided
in this Agreement and the other Loan Documents (and stated herein or therein, as
applicable, to be computed on the basis of a 360 day year or any other period of
time less than a calendar year) are equivalent are the rates so determined
multiplied by the actual number of days in the applicable calendar year and
divided by 360 or such other period of time, respectively.  For
greater certainty, and to the extent permitted by applicable law, the provisions
of the Judgment Interest Act
(Alberta) will not apply to the Loan Documents and are hereby expressly
waived by the Borrower.

     

    Section
3.03         Alternate Rate of
Interest.  If prior to the commencement of any Interest Period
for a Eurodollar Borrowing:

     

    (a)          the
Administrative Agent determines (which determination shall be conclusive absent
manifest error) that adequate and reasonable means do not exist for ascertaining
the Adjusted LIBO Rate or the LIBO Rate for such Interest Period;
or

     

    (b)          the
Administrative Agent is advised by the Majority Lenders that the Adjusted LIBO
Rate or LIBO Rate, as applicable, for such Interest Period will not adequately
and fairly reflect the cost to such Lenders of making or maintaining their Loans
included in such Borrowing for such Interest Period;

     

    then the
Administrative Agent shall give notice thereof to the Borrower and the Lenders
by telephone or telecopy as promptly as practicable thereafter and, until the
Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective,
and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such
Borrowing shall be made either as an ABR Borrowing or at an alternate rate of
interest determined by the Majority Lenders as their cost of
funds.

    
      
         

      

      
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    Section
3.04         Prepayments.

     

    (a)          Optional
Prepayments.  The Borrower shall have the right at any time and
from time to time to prepay any Borrowing in whole or in part, subject to prior
notice in accordance with Section 3.04(b).

     

    (b)          Notice and Terms of Optional
Prepayment.  The Borrower shall notify the Administrative Agent
by telephone (confirmed by telecopy) of any prepayment hereunder (i) in the case
of prepayment of a Eurodollar Borrowing, not later than 12:00 noon, New York
City time, three Business Days before the date of prepayment, or (ii) in the
case of prepayment of an ABR Borrowing, not later than 12:00 noon, New York City
time, one Business Day before the date of prepayment.  Each such
notice shall be irrevocable and shall specify the prepayment date and the
principal amount of each Borrowing or portion thereof to be
prepaid.  Promptly following receipt of any such notice relating to a
Borrowing, the Administrative Agent shall advise the Lenders of the contents
thereof.  Each partial prepayment of any Borrowing shall be in an
amount that would be permitted in the case of an advance of a Borrowing of the
same Type as provided in Section 2.02.  Each prepayment of a Borrowing
shall be applied ratably to the Loans included in the prepaid
Borrowing.  Prepayments shall be accompanied by accrued interest to
the extent required by Section 3.02.

     

    (c)          Mandatory
Prepayments.

     

    (i)           If,
after giving effect to any termination or reduction of the Aggregate Maximum
Credit Amounts pursuant to Section 2.06(b), the total Revolving Credit Exposures
exceeds the total Commitments, then the Borrower shall (A) prepay the Borrowings
on the date of such termination or reduction in an aggregate principal amount
equal to such excess, and (B) if any excess remains after prepaying all of the
Borrowings as a result of an LC Exposure, Cash Collateralize such excess as
provided in Section 2.08(i).

     

    (ii)          Upon
any redetermination of or adjustment to the amount of the Borrowing Base in
accordance with Section 2.07 or Section 8.13, if the total Revolving Credit
Exposures exceeds the redetermined or adjusted Borrowing Base, then the Borrower
shall (A) prepay the Borrowings in an aggregate principal amount equal to such
excess, and (B) if any excess remains after prepaying all of the Borrowings as a
result of an LC Exposure, Cash Collateralize such excess as provided in Section
2.08(i).  The Borrower shall be obligated to make such prepayment
and/or Cash Collateralize such excess (A) in the case of a redetermination
pursuant to Section 2.07(d), no later than the date that is 90 days following
its receipt of the New Borrowing Base Notice in accordance with Section 2.07(d);
and (B) in the case of adjustment pursuant to Section 8.13, on the date the
adjustment occurs; provided that all
payments required to be made pursuant to this Section 3.04(c)(ii) must be made
on or prior to the Termination Date.

     

    (iii)         Upon
any adjustments to the Borrowing Base pursuant to Section 9.11(d), if the total
Revolving Credit Exposures exceeds the Borrowing Base as adjusted, then the
Borrower shall (A) prepay the Borrowings in an aggregate principal amount equal
to such excess, and (B) if any excess remains after prepaying all of the
Borrowings as a result of an LC Exposure, Cash Collateralize such excess as
provided in Section 2.08(i).  The Borrower shall be obligated to make
such prepayment and/or Cash Collateralize such excess on the date it or any
Subsidiary receives cash proceeds as a result of such disposition; provided that all
payments required to be made pursuant to this Section 3.04(c)(iii) must be made
on or prior to the Termination Date.

     

    (iv)         Each
prepayment of Borrowings pursuant to this Section 3.04(c) shall be applied,
first,
ratably to any ABR Borrowings then outstanding, and, second,
to any Eurodollar Borrowings then outstanding, and if more than one Eurodollar
Borrowing is then outstanding, to each such Eurodollar Borrowing in order of
priority beginning with the Eurodollar Borrowing with the least number of days
remaining in the Interest Period applicable thereto and ending with the
Eurodollar Borrowing with the most number of days remaining in the Interest
Period applicable thereto.

    
      
         

      

      
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    (v)          Each
prepayment of Borrowings pursuant to this Section 3.04(c) shall be applied
ratably to the Loans included in the prepaid Borrowings.  Prepayments
pursuant to this Section 3.04(c) shall be accompanied by accrued interest to the
extent required by Section 3.02.

     

    (d)          No Premium or
Penalty.  Prepayments permitted or required under this Section
3.04 shall be without premium or penalty, except as required under Section
5.02.

     

    Section
3.05         Fees.

     

    (a)          Commitment
Fees.  Subject to Section 4.03(c)(i), the Borrower agrees to
pay to the Administrative Agent for the account of each Lender a commitment fee,
which shall accrue at the Commitment Fee Rate on the average daily amount of the
unused amount of the Commitment of such Lender during the period from and
including the date of this Agreement to but excluding the Termination
Date.  Accrued commitment fees shall be payable in arrears on the last
day of March, June, September and December of each year and on the Termination
Date, commencing on the first such date to occur after the Effective
Date.  All commitment fees shall be computed on the basis of a year of
360 days, unless such computation would exceed the Highest Lawful Rate, in which
case interest shall be computed on the basis of a year of 365 days (or 366 days
in a leap year), and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).

     

    (b)          Letter of Credit
Fees.  The Borrower agrees to pay (i) to the Administrative
Agent for the account of each Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same Applicable
Margin used to determine the interest rate applicable to Eurodollar Loans on the
average daily amount of such Lender’s LC Exposure (excluding any portion thereof
attributable to unreimbursed LC Disbursements) during the period from and
including the date of this Agreement to but excluding the later of the date on
which such Lender’s Commitment terminates and the date on which such Lender
ceases to have any LC Exposure and (ii) to the Issuing Bank, for its own
account, its standard fees with respect to the issuance, amendment, renewal or
extension of any Letter of Credit or processing of drawings
thereunder.  Participation fees accrued through and including the last
day of March, June, September and December of each year shall be payable on the
third Business Day following such last day, commencing on the first such date to
occur after the date of this Agreement; provided that all
such fees shall be payable on the Termination Date and any such fees accruing
after the Termination Date shall be payable on demand.  Any other fees
payable to the Issuing Bank pursuant to this Section 3.05(b) shall be payable
within 10 days after demand.  All participation fees shall be computed
on the basis of a year of 360 days, unless such computation would exceed the
Highest Lawful Rate, in which case interest shall be computed on the basis of a
year of 365 days (or 366 days in a leap year), and shall be payable for the
actual number of days elapsed (including the first day but excluding the last
day).

     

    (c)          Fee
Letter.  The Borrower agrees to pay to the Administrative
Agent, for the account of each Person therein specified, the fees payable in the
amounts and at the times stated therein.

    
      
         

      

      
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    ARTICLE
IV

    Payments;
Pro Rata Treatment; Sharing of Set-offs

     

    Section
4.01         Payments Generally; Pro Rata
Treatment; Sharing of Set-offs.

     

    (a)          Payments by the
Borrower.  The Borrower shall make each payment required to be
made by it hereunder (whether of principal, interest, fees or reimbursement of
LC Disbursements, or of amounts payable under Section 5.01, Section 5.02,
Section 5.03 or otherwise) prior to 12:00 noon, New York City time, on the date
when due, in immediately available funds, without defense, deduction,
recoupment, set-off or counterclaim.  Fees, once paid, shall be fully
earned and shall not be refundable under any circumstances.  Any
amounts received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon.  All such
payments shall be made to the Administrative Agent at its offices specified in
Section 12.01, except payments to be made directly to the Issuing Bank as
expressly provided herein and except that payments pursuant to Section 5.01,
Section 5.02, Section 5.03 and Section 12.03 shall be made directly to the
Persons entitled thereto.  The Administrative Agent shall distribute
any such payments received by it for the account of any other Person to the
appropriate recipient promptly following receipt thereof.  If any
payment hereunder shall be due on a day that is not a Business Day, the date for
payment shall be extended to the next succeeding Business Day, and, in the case
of any payment accruing interest, interest thereon shall be payable for the
period of such extension.  All payments hereunder shall be made in US
Dollars.

     

    (b)          Application of Insufficient
Payments.  If at any time insufficient funds are received by
and available to the Administrative Agent to pay fully all amounts of principal,
unreimbursed LC Disbursements, interest and fees then due hereunder, such funds
shall be applied (i) first,
towards payment of interest and fees then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of interest and fees
then due to such parties, and (ii) second,
towards payment of principal and unreimbursed LC Disbursements then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of principal and unreimbursed LC Disbursements then due to such
parties.

     

    (c)          Sharing of Payments by
Lenders.  If any Lender shall, by exercising any right of
set-off or counterclaim or otherwise, obtain payment in respect of any principal
of or interest on any of its Loans or participations in LC Disbursements
resulting in such Lender receiving payment of a greater proportion of the
aggregate amount of its Loans and participations in LC Disbursements and accrued
interest thereon than the proportion received by any other Lender, then the
Lender receiving such greater proportion shall purchase (for cash at face value)
participations in the Loans and participations in LC Disbursements of other
Lenders to the extent necessary so that the benefit of all such payments shall
be shared by the Lenders ratably in accordance with the aggregate amount of
principal of and accrued interest on their respective Loans and participations
in LC Disbursements; provided that (i) if
any such participations are purchased and all or any portion of the payment
giving rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, without interest, and
(ii) the provisions of this Section 4.01(c) shall not be construed to apply to
any payment made by the Borrower pursuant to and in accordance with the express
terms of this Agreement or any payment obtained by a Lender as consideration for
the assignment of or sale of a participation in any of its Loans or
participations in LC Disbursements to any assignee or participant, other than to
the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions
of this Section 4.01(c) shall apply).  The Borrower consents to the
foregoing and agrees, to the extent it may effectively do so under applicable
law, that any Lender acquiring a participation pursuant to the foregoing
arrangements may exercise against the Borrower rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of the Borrower in the amount of such
participation.

    
      
         

      

      
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    Section
4.02         Presumption of Payment by
the Borrower.  Unless the Administrative Agent shall have
received notice from the Borrower prior to the date on which any payment is due
to the Administrative Agent for the account of the Lenders or the Issuing Bank
that the Borrower will not make such payment, the Administrative Agent may
assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders or
the Issuing Bank, as the case may be, the amount due.  In such event,
if the Borrower has not in fact made such payment, then each of the Lenders or
the Issuing Bank, as the case may be, severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such
Lender or Issuing Bank with interest thereon, for each day from and including
the date such amount is distributed to it to but excluding the date of payment
to the Administrative Agent, at the greater of the Federal Funds Effective Rate
and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation.

     

    Section
4.03         Defaulting
Lenders.

     

    (a)          If
any Lender shall fail to make any payment required to be made by it pursuant to
Section 2.05(b), Section 2.08(d), Section 2.08(e) or Section 4.02, then the
Administrative Agent may, in its sole discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the Administrative
Agent for the account of such Lender to satisfy such Lender’s obligations under
such Sections until all such unsatisfied obligations are fully paid in
cash.

     

    (b)          If
a Defaulting Lender (or a Lender who would be a Defaulting Lender but for the
expiration of the relevant grace period) as a result of the exercise of a
set-off shall have received a payment in respect of its Revolving Credit
Exposure which results in its Revolving Credit Exposure being less than its
Applicable Percentage of the aggregate Revolving Credit Exposures, then no
payments will be made to such Defaulting Lender until such time as such
Defaulting Lender shall have complied with Section 4.03(c) and all amounts due
and owing to the Lenders have been equalized in accordance with each Lender’s
respective pro rata share of the Indebtedness.  Further, if at any
time prior to the acceleration or maturity of the Loans, the Administrative
Agent shall receive any payment in respect of principal of a Loan or a
reimbursement of an LC Disbursement while one or more Defaulting Lenders shall
be party to this Agreement, the Administrative Agent shall apply such payment
first to the Borrowing(s) for which such Defaulting Lender(s) shall have failed
to fund its pro rata share until such time as such Borrowing(s) are paid in full
or each Lender (including each Defaulting Lender) is owed its Applicable
Percentage of all Loans then outstanding.  After acceleration or
maturity of the Loans, subject to the first sentence of this Section 4.03(b),
all principal will be paid ratably as provided in Section 10.02(c).

     

    (c)          Notwithstanding
any provision of this Agreement to the contrary, if any Lender becomes a
Defaulting Lender, then the following provisions shall apply for so long as such
Lender is a Defaulting Lender:

     

    (i)           fees
shall cease to accrue on the unfunded portion of the Commitment of such
Defaulting Lender pursuant to Section 3.05.

     

    (ii)          The
Commitment and Revolving Credit Exposure of such Defaulting Lender shall not be
included in determining whether all Lenders or the Majority Lenders have taken
or may take any action hereunder (including any consent to any amendment or
waiver pursuant to Section 12.02), provided that (A) any
waiver, amendment or modification requiring the consent of each Lender or each
affected Lender pursuant to Section 12.02 (other than Section 12.02(b)(ii)),
shall require the consent of such Defaulting Lender and (B) any redetermination,
whether an increase, decrease or  affirmation, of the Borrowing Base
shall occur without the participation of such Defaulting Lender, but the
Commitment (i.e., such
Defaulting Lender’s Applicable Percentage of the Borrowing Base) of such
Defaulting Lender may not be increased without the consent of such Defaulting
Lender.

    
      
         

      

      
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    (iii)         If
any LC Exposure exists at the time a Lender becomes a Defaulting Lender
then:

     

    (A)           all
or any part of such LC Exposure shall be reallocated among the Non-Defaulting
Lenders in accordance with their respective Applicable Percentages but only to
the extent (x) the sum of all Non-Defaulting Lenders’ Revolving Credit Exposures
plus such Defaulting Lender’s LC Exposure does not exceed the total of all
Non-Defaulting Lenders’ Commitments, (y) the conditions set forth in Section
6.02 are satisfied at such time, and (z) the sum of each Non-Defaulting Lender’s
Revolving Credit Exposure plus its reallocated share of such Defaulting Lender’s
LC Exposure does not exceed such Non-Defaulting Lender’s Commitment; provided, that no
such reallocation will constitute a waiver or release of any claim the Borrower,
the Administrative Agent, the Issuing Bank or any Lender may have against such
Defaulting Lender or cause such Defaulting Lender to be a Non-Defaulting
Lender;

     

    (B)           if
the reallocation described in Section 4.03(c)(iii)(A) cannot, or can only
partially, be effected, then the Borrower shall within one Business Day
following notice by the Administrative Agent Cash Collateralize such Defaulting
Lender’s LC Exposure (after giving effect to any partial reallocation pursuant
to Section 4.03(c)(iii)(A)) pursuant to Section 2.08(i) for so long as such LC
Exposure is outstanding;

     

    (C)           if
the Borrower Cash Collateralizes any portion of such Defaulting Lender’s LC
Exposure pursuant to Section 4.03(c)(iii)(B), then the Borrower shall not be
required to pay any fees to such Defaulting Lender pursuant to Section 3.05(b)
with respect to such Defaulting Lender’s LC Exposure during the period such
Defaulting Lender’s LC Exposure is Cash Collateralized;

     

    (D)           if
the LC Exposure of the Non-Defaulting Lenders is reallocated pursuant to Section
4.03(c)(iii)(A), then the fees payable to the Lenders pursuant to Section
3.05(b) shall be adjusted in accordance with such Non-Defaulting Lenders’
Applicable Percentages; and

     

    (E)           if
any Defaulting Lender’s LC Exposure is neither Cash Collateralized nor
reallocated pursuant to Section 4.03(c)(iii), then, without prejudice to any
rights or remedies of the Issuing Bank or any Lender hereunder, all letter of
credit fees payable under Section 3.05(b) with respect to such Defaulting
Lender’s LC Exposure shall be payable to the Issuing Bank until such LC Exposure
is Cash Collateralized and/or reallocated.

     

    (d)       
  In the event that the Administrative Agent, the Borrower and the
Issuing Bank each agrees that a Defaulting Lender has adequately remedied all
matters that caused such Lender to be a Defaulting Lender, then the LC Exposure
of the Lenders shall be readjusted to reflect the inclusion of such Lender’s
Commitment and on such date such Lender shall purchase at par such of the Loans
of the other Lenders as the Administrative shall determine may be necessary in
order for such Lender to hold such Loans in accordance with its Applicable
Percentage; provided, that no
adjustments will be made retroactively with respect to fees accrued while such
Lender was a Defaulting Lender; and provided, further, that except
to the extent otherwise expressly agreed by the affected parties, no change
hereunder from Defaulting Lender to Non-Defaulting Lender will constitute a
waiver or release of any claim of any party hereunder arising from such Lender
having been a Defaulting Lender.

    
      
         

      

      
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    ARTICLE
V

    Increased
Costs; Break Funding Payments; Taxes; Illegality

     

    Section
5.01         Increased
Costs.

     

    (a)          Eurodollar Changes in
Law.  If any Change in Law shall:

     

    (i)           impose,
modify or deem applicable any reserve, special deposit or similar requirement
against assets of, deposits with or for the account of, or credit extended by,
any Lender (except  any such reserve requirement reflected in the
Adjusted LIBO Rate); or

     

    (ii)          impose
on any Lender or the London interbank market any other condition affecting this
Agreement or Eurodollar Loans made by such Lender;

     

    and the
result of any of the foregoing shall be to increase the cost to such Lender of
making or maintaining any Eurodollar Loan (or of maintaining its obligation to
make any such Loan) or to reduce the amount of any sum received or receivable by
such Lender (whether of principal, interest or otherwise), then the Borrower
will pay to such Lender such additional amount or amounts as will compensate
such Lender for such additional costs incurred or reduction
suffered.

     

    (b)          Capital
Requirements.  If any Lender or the Issuing Bank determines
that any Change in Law regarding capital requirements has or would have the
effect of reducing the rate of return on such Lender’s or the Issuing Bank’s
capital or on the capital of such Lender’s or the Issuing Bank’s holding
company, if any, as a consequence of this Agreement or the Loans made by, or
participations in Letters of Credit held by, such Lender, or the Letters of
Credit issued by the Issuing Bank, to a level below that which such Lender or
the Issuing Bank or such Lender’s or the Issuing Bank’s holding company could
have achieved but for such Change in Law (taking into consideration such
Lender’s or the Issuing Bank’s policies and the policies of such Lender’s or the
Issuing Bank’s holding company with respect to capital adequacy), then from time
to time the Borrower will pay to such Lender or the Issuing Bank, as the case
may be, such additional amount or amounts as will compensate such Lender or the
Issuing Bank or such Lender’s or the Issuing Bank’s holding company for any such
reduction suffered.

     

    (c)          Certificates.  A
certificate of a Lender or the Issuing Bank setting forth the amount or amounts
necessary to compensate such Lender or the Issuing Bank or its holding company,
as the case may be, as specified in Section 5.01(a) or (b) shall be delivered to
the Borrower and shall be conclusive absent manifest error.  The
Borrower shall pay such Lender or the Issuing Bank, as the case may be, the
amount shown as due on any such certificate within 10 days after receipt
thereof.

     

    (d)          Effect of Failure or Delay
in Requesting Compensation.  Failure or delay on the part of
any Lender or the Issuing Bank to demand compensation pursuant to this Section
5.01 shall not constitute a waiver of such Lender’s or the Issuing Bank’s right
to demand such compensation; provided that the
Borrower shall not be required to compensate a Lender or the Issuing Bank
pursuant to this Section 5.01 for any increased costs or reductions incurred
more than 365 days prior to the date that such Lender or the Issuing Bank, as
the case may be, notifies the Borrower of the Change in Law giving rise to such
increased costs or reductions and of such Lender’s or the Issuing Bank’s
intention to claim compensation therefor; provided further
that, if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the 365-day period referred to above shall be extended to
include the period of retroactive effect thereof.

    
      
         

      

      
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    Section
5.02         Break Funding
Payments.  In the event of (a) the payment of any principal of
any Eurodollar Loan other than on the last day of an Interest Period applicable
thereto (including as a result of an Event of Default), (b) the conversion of
any Eurodollar Loan into an ABR Loan other than on the last day of the Interest
Period applicable thereto, (c) the failure to borrow, convert, continue or
prepay any Eurodollar Loan on the date specified in any notice delivered
pursuant hereto, or (d) the assignment of any Eurodollar Loan other than on
the last day of the Interest Period applicable thereto as a result of a request
by the Borrower pursuant to Section 5.04, then, in any such event, the Borrower
shall compensate each Lender for the loss, cost and expense attributable to such
event.  In the case of a Eurodollar Loan, such loss, cost or expense
to any Lender shall be deemed to include an amount determined by such Lender to
be the excess, if any, of (i) the amount of interest which would have accrued on
the principal amount of such Loan had such event not occurred, at the Adjusted
LIBO Rate that would have been applicable to such Loan, for the period from the
date of such event to the last day of the then current Interest Period therefor
(or, in the case of a failure to borrow, convert or continue, for the period
that would have been the Interest Period for such Loan), over (ii) the amount of
interest which would accrue on such principal amount for such period at the
interest rate which such Lender would bid were it to bid, at the commencement of
such period, for US Dollar deposits of a comparable amount and period from other
banks in the eurodollar market.

     

    A
certificate of any Lender setting forth any amount or amounts that such Lender
is entitled to receive pursuant to this Section 5.02 shall be delivered to the
Borrower and shall be conclusive absent manifest error.  The Borrower
shall pay such Lender the amount shown as due on any such certificate within 10
days after receipt thereof.

     

    Section
5.03         Taxes.

     

    (a)          Payments Free of
Taxes.  Any and all payments by or on account of any obligation
of any Credit Party under any Loan Document shall be made free and clear of and
without deduction for any Indemnified Taxes or Other Taxes; provided that if any
Credit Party shall be required to deduct any Indemnified Taxes or Other Taxes
from such payments, then (i) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 5.03(a)), the
Administrative Agent, Lender or Issuing Bank (as the case may be) receives an
amount equal to the sum it would have received had no such deductions been made,
(ii)  such Credit Party shall make such deductions and (iii)  such
Credit Party shall pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.

     

    (b)          Payment of Other Taxes by
the Borrower.  The Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.

     

    (c)          Indemnification by the
Borrower.  The Borrower shall indemnify the Administrative
Agent, each Lender and the Issuing Bank, within 10 days after written demand
therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by
the Administrative Agent, such Lender or the Issuing Bank, as the case may be,
on or with respect to any payment by or on account of any obligation of the
Borrower hereunder (including Indemnified Taxes or Other Taxes imposed or
asserted on or attributable to amounts payable under this Section 5.03) and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority.  A
certificate of the Administrative Agent, a Lender or the Issuing Bank as to the
amount of such payment or liability under this Section 5.03 shall be delivered
to the Borrower and shall be conclusive absent manifest error.

     

    (d)          Evidence of
Payments.  As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by any Credit Party to a Governmental
Authority, the Borrower shall deliver to the Administrative Agent the original
or a certified copy of a receipt issued by such Governmental Authority
evidencing such payment, a copy of the return reporting such payment or other
evidence of such payment reasonably satisfactory to the Administrative
Agent.

    
      
         

      

      
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      (e)           Foreign
Lenders.  Any Foreign Lender that is entitled to an exemption
from or reduction of withholding tax under the law of the jurisdiction in which
the Borrower is located, or any treaty to which such jurisdiction is a party,
with respect to payments under this Agreement or any other Loan Document shall
deliver to the Borrower (with a copy to the Administrative Agent), at the time
or times prescribed by applicable law, such properly completed and executed
documentation prescribed by applicable law or reasonably requested by the
Borrower as will permit such payments to be made without withholding or at a
reduced rate.

       

      (f)           Tax
Refunds.  If the Administrative Agent or a Lender determines,
in its sole discretion, that it has received a refund of any Taxes or Other
Taxes as to which it has been indemnified by the Borrower or with respect to
which the Borrower has paid additional amounts pursuant to this Section 5.03, it
shall pay over such refund to the Borrower (but only to the extent of indemnity
payments made, or additional amounts paid, by the Borrower under this Section
5.03 with respect to the Taxes or Other Taxes giving rise to such refund), net
of all out-of-pocket expenses of the Administrative Agent or such Lender
incurred as a result of receiving such refund or in connection with paying over
such refund and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund); provided that the Borrower,
upon the request of the Administrative Agent or such Lender, agrees to repay the
amount paid over to the Borrower (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) to the Administrative Agent or
such Lender in the event the Administrative Agent or such Lender is required to
repay such refund to such Governmental Authority.  This Section 5.03
shall not be construed to require the Administrative Agent or any Lender to make
available its tax returns (or any other information relating to its taxes which
it deems confidential) to the Borrower or any other Person.

       

      Section
5.04         Designation of Different
Lending Office.  If any Lender requests compensation under
Section 5.01, or if the Borrower is required to pay any additional amount
to any Lender or any Governmental Authority for the account of any Lender
pursuant to Section 5.03, then such Lender shall use reasonable efforts to
designate a different lending office for funding or booking its Loans hereunder
or to assign its rights and obligations hereunder to another of its offices,
branches or affiliates, if, in the judgment of such Lender, such designation or
assignment (a) would eliminate or reduce amounts payable pursuant to Section
5.01 or Section 5.03, as the case may be, in the future and (b) would not
subject such Lender to any unreimbursed cost or expense and would not otherwise
be disadvantageous to such Lender.  The Borrower hereby agrees to pay
all reasonable costs and expenses incurred by any Lender in connection with any
such designation or assignment.

       

      Section
5.05         Illegality.  Notwithstanding
any other provision of this Agreement, in the event that it becomes unlawful for
any Lender or its applicable lending office to honor its obligation to make or
maintain Eurodollar Loans either generally or having a particular Interest
Period hereunder, then (a) such Lender shall promptly notify the Borrower and
the Administrative Agent thereof and such Lender’s obligation to make such
Eurodollar Loans shall be suspended (the “Affected Loans”)
until such time as such Lender may again make and maintain such Eurodollar Loans
and (b) all Affected Loans which would otherwise be made by such Lender shall be
made instead as ABR Loans (and, if such Lender so requests by notice to the
Borrower and the Administrative Agent, all Affected Loans of such Lender then
outstanding shall be automatically converted into ABR Loans on the date
specified by such Lender in such notice) and, to the extent that Affected Loans
are so made as (or converted into) ABR Loans, all payments of principal which
would otherwise be applied to such Lender’s Affected Loans shall be applied
instead to its ABR Loans.

      
        
           

        

        
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      ARTICLE
VI

      Conditions
Precedent

       

      Section
6.01         Effective
Date.  The obligations of the Lenders to make Loans and of the
Issuing Bank to issue Letters of Credit hereunder shall not become effective
until the date on which each of the following conditions is satisfied (or waived
in accordance with Section 12.02):

       

      (a)           The
Administrative Agent, the Global Coordinator, the Bookrunner, the Arranger and
the Lenders shall have received all commitment and agency fees and all other
fees and amounts due and payable on or prior to the Effective Date, including,
to the extent invoiced, reimbursement or payment of all out-of-pocket expenses
required to be reimbursed or paid by the Borrower hereunder (including, without
limitation, the fees and expenses of Vinson & Elkins LLP, Posse, Herrera
& Ruiz S.A., Macleod Dixon LLP, and Appleby, counsel to the Administrative
Agent).

       

      (b)           The
Administrative Agent shall have received a certificate of the Secretary or an
Assistant Secretary of each Credit Party setting forth (i) resolutions of its
board of directors or other applicable governing body with respect to the
authorization of such Credit Party to execute and deliver the Loan Documents to
which it is a party and to enter into the transactions contemplated in those
documents, (ii) the officers of such Credit Party (y) who are authorized to sign
the Loan Documents to which such Credit Party is a party and (z) who will, until
replaced by another officer or officers duly authorized for that purpose, act as
its representative for the purposes of signing documents and giving notices and
other communications in connection with this Agreement and the transactions
contemplated hereby, (iii) specimen signatures of such authorized officers, and
(iv) the articles or certificate of incorporation and bylaws (or other
organizational documents) of such Credit Party, certified as being true and
complete.  The Administrative Agent and the Lenders may conclusively
rely on such certificate until the Administrative Agent receives notice in
writing from the Borrower to the contrary.

       

      (c)           The
Administrative Agent shall have received certificates of the appropriate
Governmental Authorities with respect to the existence, qualification and good
standing of each Credit Party.

       

      (d)           The
Administrative Agent shall have received a compliance certificate which shall be
substantially in the form of Exhibit D, duly and
properly executed by a Responsible Officer and dated as of the date of Effective
Date.

       

      (e)           The
Administrative Agent shall have received from each party hereto counterparts (in
such number as may be requested by the Administrative Agent) of this Agreement
signed on behalf of such party.

       

      (f)           The
Administrative Agent shall have received duly executed Notes and the Colombian
Notes payable to the order of each Lender in a principal amount equal to its
Maximum Credit Amount dated as of the Effective Date.

       

      (g)           The
Administrative Agent shall have received from each party thereto duly executed
counterparts (in such number as may be requested by the Administrative Agent) of
the Security Instruments, including the Guaranty Agreement, the Colombian
Security Documents, the Cayman Security Documents, the Canadian Security
Documents, the Deposit Account Control Agreement (Gran Tierra Energy Colombia),
the Deposit Account Control Agreement (Solana Petroleum Exploration), and the
other Security Instruments described on Exhibit E, together
with share certificates, share transfer instruments, registers, direction
letters, acknowledgement notices, memoranda and any other documents in
connection with the Liens created thereby as the Administrative Agent may
reasonably require, and in the case of the Colombian Security Documents, duly
filed and (if applicable) recorded before the competent Chamber of
Commerce.  In connection with the execution and delivery of the
Security Instruments, the Administrative Agent shall have
received:

      
        
           

        

        
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      (i)        appropriate
governmental or third party search certificates (including, if applicable, UCC
search certificates) as it may require reflecting no prior Liens encumbering the
Properties of the Credit Parties for each of the following
jurisdictions:  Colombia, the Cayman
Islands, Canada, Delaware, District of Columbia, Nevada, Utah, and any
other jurisdiction requested by the Administrative Agent; other than those being
assigned or released on or prior to the Effective Date or Liens permitted by
Section 9.03.

       

      (ii)       evidence
satisfactory to it that all loans and other amounts owing under that certain
Amended and Restated Credit Agreement dated as of August 24, 2009, by and among
Gran Tierra Energy Colombia, as borrower, the guarantors party thereto, the
lenders party thereto and Standard Bank plc, as administrative agent, have been
repaid in full and all Liens securing such obligations have been fully
released.

       

      (iii)      evidence
satisfactory to the Administrative Agent that the ANH has recognized each
Colombian Branch as the operator of record of the entire right, title, estate
and interest in each Concession Agreement to which it is a party.

       

      (iv)      evidence
satisfactory to it that (A) each Guarantor has guaranteed the Indebtedness
pursuant to the Guaranty Agreement and (B) the Security Instruments create first
priority, perfected Liens on (1) all of each of the Credit Parties’ right, title
and interest in and to each Swap Agreement and Offtake Agreement to which it is
a party and (2) all of the economic rights of Solana Petroleum Exploration and
Gran Tierra Energy Colombia under each Concession Agreement to which each is a
party;

       

      (v)       a
duly executed consent and agreement of the counterparty to each Swap Agreement
and the Offtaker under each Offtake Agreement, in each case, to which any Credit
Party is a party, in form and substance satisfactory to the Administrative
Agent, pursuant to which such Person (and any other Person obligated to make
payments thereunder) shall consent to the grant of Liens under the Security
Instruments and agree to make all payments under such Swap Agreement and Offtake
Agreement to the relevant Collection Account.

       

      (vi)      evidence
satisfactory to it that all of the Equity Interests in each Credit Party (other
than the Parent) has been pledged to the Administrative Agent for the benefit of
the Secured Parties pursuant to the Security Instruments, and to the extent
applicable, the Administrative Agent shall have received certificates, together
with undated, blank stock powers for each such certificate, representing all of
the issued and outstanding Equity Interests of such Credit Party.

       

      (vii)     evidence
satisfactory to it that all filings, registrations and recordings have been made
in the appropriate governmental offices, and all other actions have been taken,
which shall be necessary or advisable to create, first priority, perfected Liens
on the Collateral pursuant to the Security Instruments; and

       

      (viii)    evidence
satisfactory to the Administrative Agent (with sufficient copies for each
Lender) that each Colombian Security Document has been (A) duly subscribed and
delivered and (B) duly filed and recorded before the competent Chamber of
Commerce.

       

      (h)           The
Administrative Agent shall have received an opinion of (i) Cooley LLP, special
New York counsel to the Parent and the Borrower, in form and substance
satisfactory to the Administrative Agent, (ii) Gamboa & Chalela, special
Colombian counsel to the Parent and the Borrower, in form and substance
satisfactory to the Administrative Agent, (iii) Maples and Calder,
special Cayman Islands counsel to the Parent and the Borrower, in form and
substance satisfactory to the Administrative Agent, and (iv), Blake, Cassels &
Graydon LLP, special Canadian counsel to the Parent and the Borrower, in
form and substance satisfactory to the Administrative Agent.

      
        
           

        

        
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      (i)           The
Administrative Agent shall have received a certificate of insurance coverage of
the Borrower evidencing that the Borrower is carrying insurance in accordance
with Section 7.11.

       

      (j)           The
Administrative Agent shall have received evidence satisfactory to it that all
Governmental Requirements and third-party consents and approvals necessary or
advisable in connection with the Transactions have been obtained (without the
imposition of any conditions not already satisfied) and are in full force and
effect; and all applicable waiting periods have expired without any action being
taken by any competent authority; and no law or regulation is applicable that
restrains, prevents or imposes materially adverse conditions upon the
Transactions.

       

      (k)          The
Administrative Agent shall have received a certificate of a Responsible Officer
of the Borrower certifying that the Borrower has received all consents and
approvals required by Section 7.03.

       

      (l)           The
Administrative Agent shall have received the Financial Statements and the
Initial Reserve Report accompanied by a certificate covering the matters
described in Section 8.12(c).

       

      (m)         The
Administrative Agent shall be satisfied with the terms and conditions of each
Material Document to which any Credit Party is a party.

       

      (n)         The
Administrative Agent shall have received a copy, certified by a Responsible
Officer as true and complete (in each case, together with all amendments
thereto, if any), of (i) each Concession Agreement listed on Schedule 1.02(a),
together with all amendments thereto, if any, and all participation agreements,
farm-ins, royalty agreements or similar agreements that establish any obligation
or interest in favor of a third party derived from the Concession Agreements,
(ii) each Offtake Agreement listed on Schedule 1.02(c) and
(iii) each Swap Agreement listed on Schedule
7.18.

       

      (o)         The
Administrative Agent and the Lenders shall have received, and be reasonably
satisfied in form and substance with, all documentation and other information
required by bank regulatory authorities under applicable “know-your-customer”
and anti-money laundering rules and regulations, including but not restricted to
the USA PATRIOT Act.

       

      (p)         The
Administrative Agent shall have received a letter from CT Corporation evidencing
the appointment of CT Corporation as authorized agent for service of process on
each Credit Party under each Loan Document to which it is a party.

       

      (q)         The
Administrative Agent shall have received such other documents as the
Administrative Agent or special counsel to the Administrative Agent may
reasonably request.

       

      The
Administrative Agent shall notify the Borrower and the Lenders of the Effective
Date, and such notice shall be conclusive and
binding.  Notwithstanding the foregoing, the obligations of the
Lenders to make Loans and of the Issuing Bank to issue Letters of Credit
hereunder shall not become effective unless each of the foregoing conditions is
satisfied (or waived pursuant to Section 12.02) at or prior to 2:00 p.m., New
York City time, on August 31, 2010
(and, in the event such conditions are not so satisfied or waived, the
Commitments shall terminate at such time).

      
        
           

        

        
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      Section
6.02         Each Credit
Event.  The obligation of each Lender to make a Loan on the
occasion of any Borrowing (including the initial funding), and of the Issuing
Bank to issue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions:

       

      (a)           At
the time of and immediately after giving effect to such Borrowing or the
issuance, amendment, renewal or extension of such Letter of Credit, as
applicable, no Default shall have occurred and be continuing.

       

      (b)           At
the time of and immediately after giving effect to such Borrowing or the
issuance, amendment, renewal or extension of such Letter of Credit, as
applicable, no event, development or circumstance has occurred or shall then
exist that has resulted in, or could reasonably be expected to have, a Material
Adverse Effect.

       

      (c)           The
representations and warranties of the Credit Parties set forth in this Agreement
and in the other Loan Documents shall be true and correct in all material
respects on and as of the date of such Borrowing or the date of issuance,
amendment, renewal or extension of such Letter of Credit, as applicable, except
to the extent any such representations and warranties are expressly limited to
an earlier date, in which case, on and as of the date of such Borrowing or the
date of issuance, amendment, renewal or extension of such Letter of Credit, as
applicable, such representations and warranties shall continue to be true and
correct in all material respects as of such specified earlier date.

       

      (d)           The
making of such Loan or the issuance, amendment, renewal or extension of such
Letter of Credit, as applicable, would not conflict with, or cause any Lender or
the Issuing Bank to violate or exceed, any applicable Governmental Requirement,
and no Change in Law shall have occurred, and no litigation shall be pending or
threatened, which does or, with respect to any threatened litigation, seeks to,
enjoin, prohibit or restrain, the making or repayment of any Loan, the issuance,
amendment, renewal, extension or repayment of any Letter of Credit or any
participations therein or the consummation of the transactions contemplated by
this Agreement or any other Loan Document.

       

      (e)           The
receipt by the Administrative Agent of a Borrowing Request in accordance with
Section 2.03 or a request for a Letter of Credit in accordance with Section
2.08(b), as applicable.

       

      Each
request for a Borrowing and each request for the issuance, amendment, renewal or
extension of any Letter of Credit shall be deemed to constitute a representation
and warranty by the Borrower on the date thereof as to the matters specified in
Section 6.02(a) through (d).

       

      Section
6.03         Additional Conditions to
Credit Events.  In addition to the conditions precedent set
forth in Section 6.02, so long as any Lender is a Defaulting Lender, the Issuing
Bank shall not be required to issue, amend or increase any Letter of Credit,
unless it is satisfied that the LC Exposure will be 100% covered by the
Commitments of the Non-Defaulting Lenders and/or the Borrower will Cash
Collateralize the LC Exposure in accordance with Section 4.03(c)(iii), and
participating interests in any such newly issued or increased Letter of Credit
shall be allocated among Non-Defaulting Lenders in accordance with Section
4.03(c)(iii)(A) (and Defaulting Lenders shall not participate
therein).

       

      ARTICLE
VII

      Representations
and Warranties

       

      The
Parent and the Borrower each represents and warrants to the Lenders
that:

      
        
           

        

        
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      Section
7.01         Organization;
Powers.  Each Credit Party is duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization (and
in the case of the Colombia Branch, has been duly formed and validly existing as
a branch of an oil exploration production related company in good standing
(where applicable) under the laws of Colombia), has all requisite power and
authority, and has all material governmental licenses, authorizations, consents
and approvals necessary, to own its assets and to carry on its business as now
conducted, and is qualified to do business in, and is in good standing in, every
jurisdiction where such qualification is required, except where failure to have
such power, authority, licenses, authorizations, consents, approvals and
qualifications could not reasonably be expected to have a Material Adverse
Effect.

       

      Section
7.02         Authority;
Enforceability.  The Transactions are within each Credit
Party’s corporate powers and have been duly authorized by all necessary
corporate and, if required, stockholder action (including, without limitation,
any action required to be taken by any class of directors of the Borrower or any
other Person, whether interested or disinterested, in order to ensure the due
authorization of the Transactions).  Each Loan Document and Material
Document to which each Credit Party is a party has been duly executed and
delivered by such Credit Party and constitutes a legal, valid and binding
obligation of such Credit Party, enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or
other laws affecting creditors’ rights generally and subject to general
principles of equity, regardless of whether considered in a proceeding in equity
or at law.

       

      Section
7.03         Approvals; No
Conflicts.  The Transactions (a) do not require any consent or
approval of, registration or filing with, or any other action by, any
Governmental Authority or any other third Person (including shareholders or any
class of directors, whether interested or disinterested, of the Parent, the
Borrower or any other Person), nor is any such consent, approval, registration,
filing or other action necessary for the validity or enforceability of any Loan
Document or any Material Document or the consummation of the Transactions,
except such as have been obtained or made and are in full force and effect other
than (i) the recording and filing of the Security Instruments as required by
this Agreement and (ii) those third party approvals or consents which, if not
made or obtained, would not cause a Default hereunder, could not reasonably be
expected to have a Material Adverse Effect or do not have an adverse effect on
the enforceability of the Loan Documents, (b) will not violate any applicable
law or regulation or the charter, by-laws or other organizational documents of
any Credit Party or any order of any Governmental Authority, (c) will not
violate or result in a default under any Material Document or any indenture,
agreement or other instrument binding upon any Credit Party or its Properties,
or give rise to a right thereunder to require any payment to be made by any
Credit Party and (d) will not result in the creation or imposition of any Lien
on any Property of any Credit Party (other than the Liens created by the Loan
Documents).

       

      Section
7.04          Financial Condition; No
Material Adverse Change.

       

      (a)           The
Parent has heretofore furnished to the Lenders its consolidated balance sheet
and statements of income, stockholders equity and cash flows as of and for the
fiscal year ended December 31, 2009,
reported on by Deloitte & Touche
LLP, independent public accountants.  Such financial statements
present fairly, in all material respects, the financial position and results of
operations and cash flows of the Parent and its Consolidated Subsidiaries as of
such date and for such period in accordance with GAAP.

       

      (b)           Since
December 31,
2009, there has been no event, development or circumstance that has had
or could reasonably be expected to have a Material Adverse Effect.

       

      (c)           Neither
the Parent nor any Subsidiary has on the date hereof any material Debt
(including Disqualified Capital Stock) or any contingent liabilities,
off-balance sheet liabilities or partnerships or liabilities for taxes, except
as referred to or reflected or provided for in the Financial
Statements.

      
        
           

        

        
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      Section
7.05          Litigation.

       

      (a)           Except
as set forth on Schedule 7.05,
there are no actions, suits, investigations or proceedings by or before any
arbitrator or Governmental Authority pending against or, to the knowledge of the
Parent or the Borrower, threatened against or affecting any Credit Party or
involving any Material Document (i) as to which there is a reasonable
possibility of an adverse determination that, if adversely determined, could
reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect or (ii) that involve any Loan Document or the
Transactions.

       

      (b)           Since
the date of this Agreement, there has been no change in the status of the
matters disclosed in Schedule 7.05
that, individually or in the aggregate, has resulted in, or materially increased
the likelihood of, a Material Adverse Effect.

       

      Section
7.06         Environmental
Matters.  Except for such matters as set forth on Schedule 7.06 or
that, individually or in the aggregate, could not reasonably be expected to have
a Material Adverse Effect:

       

      (a)           the
Parent and the Subsidiaries and each of their respective Properties and
operations thereon are, and within all applicable statute of limitation periods
have been, in compliance with all applicable Environmental Laws.

       

      (b)           the
Parent and the Subsidiaries have obtained all Environmental Permits required for
their respective operations and each of their Properties, with all such
Environmental Permits being currently in full force and effect, and none of the
Parent or the Subsidiaries has received any written notice or otherwise has
knowledge that any such existing Environmental Permit will be revoked or that
any application for any new Environmental Permit or renewal of any existing
Environmental Permit will be protested or denied.

       

      (c)           there
are no claims, demands, suits, orders, inquiries, or proceedings concerning any
violation of, or any liability (including as a potentially responsible party)
under, any applicable Environmental Laws that is pending or, to the Parent’s or
the Borrower’s knowledge, threatened against the Parent or any Subsidiary or any
of their respective Properties or as a result of any operations at such
Properties.

       

      (d)           none
of the Properties of the Parent or any Subsidiary contain or have contained
any:  (i) underground storage tanks; (ii) asbestos-containing
materials; (iii) landfills or dumps; or (iv) hazardous waste management
units.

       

      (e)           there
has been no Release or, to the Parent’s knowledge, threatened Release, of
Hazardous Materials at, on, under or from the Parent’s or any Subsidiary’s
Properties, there are no investigations, remediations, abatements, removals, or
monitorings of Hazardous Materials required under applicable Environmental Laws
at such Properties and, to the knowledge of the Parent, none of such Properties
are adversely affected by any Release or threatened Release of a Hazardous
Material originating or emanating from any other real property.

       

      (f)           neither
the Parent nor any Subsidiary has received any written notice asserting an
alleged liability or obligation under any applicable Environmental Laws with
respect to the investigation, remediation, abatement, removal, or monitoring of
any Hazardous Materials at, under, or Released or threatened to be Released from
any real properties offsite the Parent’s or any Subsidiary’s Properties and, to
the Parent’s or the Borrower’s knowledge, there are no conditions or
circumstances that could reasonably be expected to result in the receipt of such
written notice.

      
        
           

        

        
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      (g)           there
has been no exposure of any Person or Property to any Hazardous Materials as a
result of or in connection with the operations and businesses of any of the
Parent’s or the Subsidiaries’ Properties that could reasonably be expected to
form the basis for a claim for damages or compensation.

       

      (h)           The
Parent and the Subsidiaries have provided to the Lenders complete and correct
copies of all environmental site assessment reports, investigations, studies,
analyses, and correspondence on environmental matters (including matters
relating to any alleged non-compliance with or liability under Environmental
Laws) that are in any of the Parent’s or the Subsidiaries’ possession or control
and relating to their respective Properties or operations thereon.

       

      Section
7.07          Compliance with the Laws and
Agreements; No Defaults.

       

      (a)           Each
Credit Party is in compliance with all Governmental Requirements applicable to
it or its Property and all agreements and other instruments binding upon it or
its Property, and possesses all licenses, permits, franchises, exemptions,
approvals and other governmental authorizations necessary for the ownership of
its Property and the conduct of its business, except (other than with respect to
bribery and anti-corruption Governmental Requirements) where the failure to do
so, individually or in the aggregate, could not reasonably be expected to result
in a Material Adverse Effect.

       

      (b)           No
Credit Party is in default nor has any event or circumstance occurred which, but
for the expiration of any applicable grace period or the giving of notice, or
both, would constitute a default or would require such Credit Party to Redeem or
make any offer to Redeem under any indenture, note, credit agreement or
instrument pursuant to which any Material Indebtedness is outstanding or by
which any Credit Party or any of its Properties is bound.

       

      (c)           Each
Material Document is in full force and effect, and constitutes a valid and
legally enforceable obligation of the parties thereto, subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting creditors’ rights generally, general
equitable principles; and no Credit Party is in default thereunder, nor has any
event or circumstance occurred which, but for the expiration of any applicable
grace period or the giving of notice, or both, would constitute a default
thereunder, or would permit any counterparty thereto the right to terminate such
Material Document or any transaction thereunder, or exercise any remedial rights
thereunder.

       

      (d)           No
Default has occurred and is continuing.

       

      Section
7.08         Taxes.  Each
of the Parent and the Subsidiaries has timely filed or caused to be filed all
Tax returns and reports required to have been filed and has paid or caused to be
paid all Taxes required to have been paid by it, except (a) Taxes that are being
contested in good faith by appropriate proceedings and for which the Parent or
such Subsidiary, as applicable, has set aside on its books adequate reserves in
accordance with GAAP or (b) to the extent that the failure to do so could not
reasonably be expected to result in a Material Adverse Effect.  The
charges, accruals and reserves on the books of the Parent and the Subsidiaries
in respect of Taxes and other governmental charges are, in the reasonable
opinion of the Parent and the Borrower, adequate.  No Tax Lien has
been filed and, to the knowledge of the Parent or the Borrower, no claim is
being asserted with respect to any such Tax or other such governmental
charge.

      
        
           

        

        
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      Section
7.09         Employee Benefit
Arrangements.   No Credit Party maintains any employee
pension or benefit plan.  Each Colombian Branch has been and is in
material compliance with all labor, pension fund, health, industrial security
and social security obligations required under Colombian law.

       

      Section
7.10         Disclosure; No Material
Misstatements.  None of the reports, financial statements,
certificates or other information furnished by or on behalf of any Credit Party
to the Administrative Agent or any Lender or any of their Affiliates in
connection with the negotiation of this Agreement or any other Loan Document or
delivered hereunder or under any other Loan Document (as modified or
supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that, with
respect to projected financial information, the Parent and the Borrower
represents only that such information was prepared in good faith based upon
assumptions believed to be reasonable at the time.  There is no fact
peculiar to any Credit Party which could reasonably be expected to have a
Material Adverse Effect or in the future is reasonably likely to have a Material
Adverse Effect and which has not been set forth in this Agreement or the Loan
Documents or the other documents, certificates and statements furnished to the
Administrative Agent or the Lenders by or on behalf of any Credit Party prior
to, or on, the date hereof in connection with the transactions contemplated
hereby.  There are no statements or conclusions in any Reserve Report
which are based upon or include misleading information or fail to take into
account material information regarding the matters reported
therein.

       

      Section
7.11         Insurance.  The
Parent has, and has caused all Credit Parties to have, (a) all insurance
policies sufficient for the compliance by each of them with all material
Governmental Requirements and all material agreements and (b) insurance coverage
in at least amounts and against such risk (including, without limitation, public
liability) that are usually insured against by companies similarly situated and
engaged in the same or a similar business for the assets and operations of the
Subsidiaries.  The Administrative Agent and the Lenders have been
named as additional insureds in respect of such liability insurance policies in
respect of all insurance covering Oil and Gas Properties of the Credit Parties
and the Administrative Agent has been named as loss payee with respect to
Property loss insurance in respect of all insurance covering Oil and Gas
Properties of the Credit Parties.

       

      Section
7.12         Restrictive
Agreements.  No Credit Party is a party to any agreement or
arrangement, or subject to any order, judgment, writ or decree, which either
restricts or purports to restrict its ability to grant Liens to the
Administrative Agent and the Lenders on or in respect of its Properties to
secure the Indebtedness and the Loan Documents, or restricts such Credit Party
from paying dividends or making any other distributions in respect of its Equity
Interests to any other Credit Party, or restricts such Credit Party from making
loans or advances or transferring any Property to any other Credit Party, or
which requires the consent of or notice to other Persons in connection
therewith, except, in each case, for such encumbrances or restrictions permitted
under Section 9.15.

       

      Section
7.13          Subsidiaries.

       

      (a)           Set
forth on Schedule
7.13, or as disclosed in writing to the Administrative Agent, which shall
promptly furnish a copy to the Lenders, and which disclosure shall be a
supplement to Schedule
7.13, is (i) a true and complete list of each Subsidiary and each Person
holding ownership interests in such Subsidiary, and (ii) a true and complete
description of the nature of the ownership interests held by each such Person
and the percentage of ownership of such Subsidiary represented by such ownership
interests.

      
        
           

        

        
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      (b)           Except
as disclosed in Schedule 7.13, or as
disclosed in writing to the Administrative Agent, which shall promptly furnish a
copy to the Lenders, and which shall be a  supplement to Schedule 7.13, (i)
each of the Parent and the Subsidiaries owns, free and clear of Liens (other
than Liens created pursuant to the Security Instruments), and has the
unencumbered right to vote, all outstanding ownership interests in each Person
shown therein to be held by it, (iii) all of the issued and outstanding Equity
Interests of each such Person has been duly authorized and is validly issued,
fully paid and nonassessable, and (iv) there are no outstanding Equity Rights
with respect to such Person.

       

      (c)           Each
Subsidiary is a Wholly-Owned Subsidiary.

       

      Section
7.14         Location of Business and
Offices.  The Parent’s jurisdiction of incorporation is the
State of Nevada,
United States of America; the name of the Parent as listed in the public
records of its jurisdiction of organization is Gran Tierra Energy
Inc.; the organizational identification number of the Parent in its
jurisdiction of organization is C13734-2003; the Parent’s
principal place of business and chief executive offices are located at the
address specified in Section 12.01; and the Parent’s U.S. federal taxpayer
identification number is 98-0479924 (or, in each case, as set
forth in a notice delivered to the Administrative Agent pursuant to Section
8.01(m) in accordance with Section 12.01).  The Borrower’s
jurisdiction of organization is the Province of Alberta,
Canada; the name of the Borrower as listed in the public records of its
jurisdiction of organization is Solana Resources
Limited; the organizational identification number of the Borrower in its
jurisdiction of organization is 203333471; the
Borrower’s principal place of business and chief executive offices are located
at the address specified in Section 12.01; and the Borrower’s taxpayer
identification number is 131403982RT0001 (or, in each case, as set
forth in a notice delivered to the Administrative Agent pursuant to Section
8.01(m) in accordance with Section 12.01).

       

      Section
7.15          Properties; Titles,
Etc.

       

      (a)           Each
Credit Party has good and defensible title to the Oil and Gas Properties
evaluated in the most recently delivered Reserve Report and good title to all
its personal Properties, in each case, free and clear of all Liens except Liens
permitted by Section 9.03.  After giving full effect to the Excepted
Liens, each Credit Party specified as the owner owns, or has exclusive rights
in, the net interests in production attributable to the Hydrocarbon Interests as
reflected in the most recently delivered Reserve Report.

       

      (b)           All
material leases and agreements necessary for the conduct of the business of the
Credit Parties are valid and subsisting, in full force and effect, and there
exists no default or event or circumstance which with the giving of notice or
the passage of time or both would give rise to a default under any such lease or
leases, which could reasonably be expected to have a Material Adverse
Effect.

       

      (c)           The
rights and Properties presently owned, leased or licensed by the Credit Parties
including, without limitation, all easements and rights of way, include all
rights and Properties necessary to permit the Credit Parties to conduct their
business in all material respects in the same manner as its business has been
conducted prior to the date hereof.

       

      (d)           All
of the Properties of the Credit Parties which are reasonably necessary for the
operation of their businesses are in good working condition and are maintained
in accordance with prudent business standards.

       

      (e)           Each
Credit Party owns, or is licensed to use, all trademarks, tradenames,
copyrights, patents and other intellectual Property material to its business,
and the use thereof by such Credit Party does not infringe upon the rights of
any other Person, except for any such infringements that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.  The Credit Parties either own or have valid licenses or other
rights to use all databases, geological data, geophysical data, engineering
data, seismic data, maps, interpretations and other technical information used
in their businesses as presently conducted, subject to the limitations contained
in the agreements governing the use of the same, which limitations are customary
for companies engaged in the business of the exploration and production of
Hydrocarbons, with such exceptions as could not reasonably be expected to have a
Material Adverse Effect.

      
        
           

        

        
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      Section
7.16         Maintenance of
Properties.  Except for such acts or failures to act as could
not be reasonably expected to have a Material Adverse Effect, the Oil and Gas
Properties (and Properties unitized therewith) of the Credit Parties have been
maintained, operated and developed in a good and workmanlike manner and in
conformity with all Governmental Requirements and in conformity with the
provisions of all leases, subleases or other contracts comprising a part of the
Hydrocarbon Interests and other contracts and agreements forming a part of the
Oil and Gas Properties of the Credit Parties.  Specifically in
connection with the foregoing, except for those as could not be reasonably
expected to have a Material Adverse Effect, (i) no Oil and Gas Property of any
Credit Party is subject to having allowable production reduced below the full
and regular allowable (including the maximum permissible tolerance) because of
any overproduction (whether or not the same was permissible at the time) and
(ii) none of the wells comprising a part of the Oil and Gas Properties (or
Properties unitized therewith) of any Credit Party is deviated from the vertical
more than the maximum permitted by Governmental Requirements, and such wells
are, in fact, bottomed under and are producing from, and the well bores are
wholly within, the Oil and Gas Properties (or in the case of wells located on
Properties unitized therewith, such unitized Properties) of such Credit
Party.  All pipelines, wells, gas processing plants, platforms and
other material improvements, fixtures and equipment owned in whole or in part by
any Credit Party that are necessary to conduct normal operations are being
maintained in a state adequate to conduct normal operations, and with respect to
such of the foregoing which are operated by any Credit Party, in a manner
consistent with Credit Parties’ past practices (other than those the failure of
which to maintain in accordance with this Section 7.16 could not reasonably be
expected to have a Material Adverse Effect).

       

      Section
7.17          Marketing of
Production.

       

      (a)           Schedule 1.02(c) sets
forth as of the Effective Date a true and complete list of (i) all Persons to
whom each Credit Party sells crude oil and any other Hydrocarbons and (ii) all
contracts for the purchase and sale of crude oil and any other Hydrocarbons to
which the any Credit Party is a party.

       

      (b)           Each
contract for the purchase and sale of crude oil and other Hydrocarbons to which
each Credit Party is a party is an Offtake Agreement.

       

      (c)           Each
Person to whom any Credit Party sells crude oil and other Hydrocarbons is an
Eligible Buyer.

       

      Section
7.18          Swap
Agreements.  Schedule 7.18, as of
and after the Effective Date, and after the date hereof, each report required to
be delivered by the Borrower pursuant to Section 8.01(d), sets forth, a true and
complete list of all Swap Agreements of each Credit Party, the material terms
thereof (including the type, term, effective date, termination date and notional
amounts or volumes), the net mark to market value thereof, all credit support
agreements relating thereto (including any margin required or supplied) and the
counterparty to each such agreement.

      
        
           

        

        
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      Section
7.19          Use of Loans and Letters of
Credit.  The proceeds of the Loans and the Letters of Credit
shall be used to provide working capital for exploration and production
operations and for general corporate purposes of the Borrower and its
Subsidiaries; provided that the
Borrower may contribute proceeds of the Loans to the Colombian branch office of
Solana Petroleum Exploration (as a capital contribution, not a loan, whether in
the form of capital
suplementario or in other form of capital contribution legally permitted
under Colombian law, in which case the Administrative Agent shall have received
copies of forms number 4 and 13 (Formularios 4 y 13) under
Circular DCIN-83 of Colombian Central Bank (Banco de la República),
issued by the Colombian Central Bank with blanks properly completed) and shall
use, or cause such Colombian branch office to use, the proceeds of the Loans and
the Letters of Credit hereunder solely for the general corporate purposes of
such Colombian branch office, including, but not limited to, the exploration,
development and exploitation of crude oil and gas reserves from the Colombian
Hydrocarbon Properties; provided that no
proceeds of the Loans shall be provided to, or used by, directly or indirectly,
any Subsidiary organized under the laws of, or located or doing business in,
Argentina or for any business located in Argentina; provided further that none of
the Administrative Agent, the Issuing Bank nor any Lender shall have any
responsibility to monitor or verify the application by the Borrower of any
amounts borrowed pursuant to this Agreement.  The Parent and the
Subsidiaries are not engaged principally, or as one of its or their important
activities, in the business of extending credit for the purpose, whether
immediate, incidental or ultimate, of buying or carrying margin stock (within
the meaning of Regulation T, U or X of the Board).  No part of the
proceeds of any Loan or Letter of Credit will be used for any purpose which
violates the provisions of Regulations T, U or X of the Board.

       

      Section
7.20           Solvency.  After
giving effect to the transactions contemplated hereby, (a) the aggregate assets
(after giving effect to amounts that could reasonably be received by reason of
indemnity, offset, insurance or any similar arrangement), at a fair valuation,
of the Credit Parties, taken as a whole, will exceed the aggregate Debt of the
Credit Parties on a consolidated basis, as the Debt becomes absolute and
matures, (b) each of the Credit Parties will not have incurred or intended to
incur, and will not believe that it will incur, Debt beyond its ability to pay
such Debt (after taking into account the timing and amounts of cash to be
received by each of the Credit Parties and the amounts to be payable on or in
respect of its liabilities, and giving effect to amounts that could reasonably
be received by reason of indemnity, offset, insurance or any similar
arrangement) as such Debt becomes absolute and matures and (c) each of the
Credit Parties will not have (and will have no reason to believe that it will
have thereafter) unreasonably small capital for the conduct of its
business.

       

      Section
7.21           Material
Documents.  The copies of the Material Documents previously
delivered by the Parent or the Borrower to the Administrative Agent are true,
accurate and complete and have not been amended or modified in any manner, other
than pursuant to amendments or modifications permitted pursuant to Section 9.17
and previously delivered to the Administrative Agent.

       

      Section
7.22           Ranking.  The
Loans and the LC Exposure constitute senior secured Debt of the Credit Parties
and rank (a) pari passu
with all obligations under all Secured Swap Agreements and Debt secured by Liens
permitted by Section 9.03(d) and (b) effectively senior to all other Debt of the
Credit Parties to the extent of the value of the Collateral (other than Debt
secured by Liens permitted by Section 9.03(d)), except for obligations that are
accorded mandatory preference by law and as may be limited by bankruptcy,
insolvency or similar laws affecting the enforcement of creditors’ rights
generally and as may be limited by equitable principles of general
applicability.

       

      Section
7.23           USA Patriot Act/Anti-Money
Laundering.  To the extent applicable, the Parent and each
Subsidiary is in compliance, in all material respects, with (a) the Trading with
the Enemy Act, as amended, and each of the foreign assets control regulations of
the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as
amended) and any other enabling legislation or executive order relating thereto,
and (b) the USA Patriot Act.  No part of the proceeds of the Loans
will be used, directly or indirectly, for any payments to any governmental
official or employee, political party, official of a political party, candidate
for political office, or anyone else acting in an official capacity, in order to
obtain, retain or direct business or obtain any improper advantage, in violation
of the United States Foreign Corrupt Practices Act of 1977, as
amended.

      
        
           

        

        
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      Section
7.24          OFAC.  Neither
the Parent nor any of the Subsidiaries, nor any director, officer, agent,
employee or Affiliate of the Parent or any of the Subsidiaries is currently
subject to any material U.S. sanctions administered by OFAC, and the Borrower
will not directly or indirectly use the proceeds from the Loans or lend,
contribute or otherwise make available such proceeds to any Subsidiary, joint
venture partner or other Person, for the purpose of financing the activities of
any Person currently subject to any U.S. sanctions administered by
OFAC.

       

      Section
7.25          Foreign Exchange Special
Regime.  Each Colombian Branch is subject to, and in compliance
with, the corresponding foreign exchange special regime applicable to oil sector
companies, composed by External Resolution 8 of 2000 and circular reglamentaria
externa DCIN-83, both issued by the Colombian Central Bank (Banco de la Republica), and
by Decree 2080 of 2000 issued by Ministry of Finance and Public Credit (Ministerio de Hacienda y Credito
Publico).

       

      ARTICLE
VIII

      Affirmative
Covenants

       

      Until the
Commitments have expired or been terminated and the principal of and interest on
each Loan and all fees payable hereunder and all other amounts payable under the
Loan Documents shall have been paid in full and all Letters of Credit shall have
expired or terminated and all LC Disbursements shall have been reimbursed, the
Parent and the Borrower each covenants and agrees with the Lenders
that:

       

      Section
8.01          Financial Statements; Other
Information.  The Parent will furnish to the Administrative
Agent and each Lender:

       

      (a)           Annual Financial
Statements.  As soon as available, but in any event in
accordance with then applicable law and not later than 90 days after the end of
each fiscal year of the Parent, its audited consolidated balance sheet and
related statements of operations, stockholders’ equity and cash flows as of the
end of and for such year, setting forth in each case in comparative form the
figures for the previous fiscal year, all reported on by Deloitte & Touche
LLP or other independent public accountants of recognized national
standing (without a “going concern” or like qualification or exception and
without any qualification or exception as to the scope of such audit) to the
effect that such consolidated financial statements present fairly in all
material respects the financial condition and results of operations of the
Parent and its Consolidated Subsidiaries on a consolidated basis in accordance
with GAAP consistently applied.

       

      (b)           Quarterly Financial
Statements.  As soon as available, but in any event in
accordance with then applicable law and not later than 45 days after the end of
each of the first three fiscal quarters of each fiscal year of the Parent, its
consolidated balance sheet and related statements of operations, stockholders’
equity and cash flows as of the end of and for such fiscal quarter and the then
elapsed portion of the fiscal year, setting forth in each case in comparative
form the figures for the corresponding period or periods of (or, in the case of
the balance sheet, as of the end of) the previous fiscal year, all certified by
one of its Financial Officers as presenting fairly in all material respects the
financial condition and results of operations of the Parent and its Consolidated
Subsidiaries on a consolidated basis in accordance with GAAP consistently
applied, subject to normal year-end audit adjustments and the absence of
footnotes.

       

      (c)           Certificate of Financial
Officer — Compliance.  Concurrently with any delivery of
financial statements under Section 8.01(a) or Section 8.01(b), a certificate of
a Financial Officer (i) certifying as to whether a Default has occurred and, if
a Default has occurred, specifying the details thereof and any action taken or
proposed to be taken with respect thereto, (ii) setting forth reasonably
detailed calculations demonstrating compliance with Section 9.01 and (iii)
stating whether any change in GAAP or in the application thereof has occurred
since the date of the Financial Statements and, if any such change has occurred,
specifying the effect of such change on the financial statements accompanying
such certificate.

      
        
           

        

        
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      (d)           Certificate of Financial
Officer – Swap Agreements.  Concurrently with the delivery of
each Reserve Report hereunder, a certificate of a Financial Officer, in form and
substance satisfactory to the Administrative Agent, setting forth as of a recent
date, a true and complete list of all Swap Agreements of the Credit Parties, the
material terms thereof (including the type, term, effective date, termination
date and notional amounts or volumes), the net mark-to-market value therefor,
any new credit support agreements relating thereto not listed on Schedule 7.18, any
margin required or supplied under any credit support document, and the
counterparty to each such agreement.

       

      (e)           Certificate of Insurer —
Insurance Coverage.  Concurrently with any delivery of
financial statements under Section 8.01(a), a certificate of insurance coverage
from each insurer with respect to the insurance required by Section 8.07, in
form and substance satisfactory to the Administrative Agent, and, if requested
by the Administrative Agent or any Lender, all copies of the applicable
policies.

       

      (f)           Other Accounting
Reports.  Promptly upon receipt thereof, a copy of each other
report or letter submitted to the Parent or any of its Subsidiaries by
independent accountants in connection with any annual, interim or special audit
made by them of the books of the Parent or any such Subsidiary, and a copy of
any response by the Parent or any such Subsidiary, or the Board of Directors of
the Parent or any such Subsidiary, to such letter or report.

       

      (g)           Securities Exchange and
Other Filings; Reports to Shareholders.  Promptly after the
same become publicly available, copies of all periodic and other reports, proxy
statements and other materials filed by the Parent or any Subsidiary with the
SEC, or with any national securities exchange (including the NYSE Amex and the
Toronto Stock Exchange), or distributed by the Parent to its shareholders
generally, as the case may be.

       

      (h)           Notices Under Material
Documents.  Promptly after the furnishing thereof, copies of
any notice, inquiry or demand (including, without limitation, any notice of, or
request for information regarding, any default, event of default, force majeure
event or termination event (caducidad), furnished to or
by any Person (whether any Credit Party, any Offtaker, any Governmental
Authority, ANH, Ecopetrol S.A., any counterparty or otherwise) pursuant to or in
connection with the terms of any Material Document.

       

      (i)           Defaults under Material
Documents.  Promptly after the Parent or the Borrower knows or
has reason to believe that any condition or event that constitutes a default,
event of default, force majeure event or termination event (howsoever described)
under any Material Document has occurred, a notice of such occurrence, together
with a certificate from a Responsible Officer of the Parent or the Borrower
specifying the nature and period of existence of such default, event of
default,  force majeure event or termination event, and any action
taken or proposed to be taken with respect thereto.

       

      (j)           Lists of
Purchasers.  Promptly following the written request of the
Administrative Agent, a list of all Persons purchasing Hydrocarbons from any
Credit Party.

       

      (k)           Notice of Sales of Oil and
Gas Properties.  In the event any Credit Party intends to sell,
transfer, assign or otherwise dispose of any Oil or Gas Properties pursuant to
Section 9.11(d) or the Parent or any Subsidiary intends to sell, transfer,
assign or otherwise dispose of any Equity Interests in any Subsidiary Guarantor
pursuant to Section 9.11(d), prior written notice (and in any event no later
than 10 days prior thereto) of such disposition, the price thereof and the
anticipated date of closing and any other details thereof requested by the
Administrative Agent or any Lender.

      
        
           

        

        
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      (l)           Notice of Casualty
Events.  Prompt written notice, and in any event within three
Business Days, of the occurrence of any Casualty Event or the commencement of
any action or proceeding that could reasonably be expected to result in a
Casualty Event.

       

      (m)           Information Regarding
Guarantors.  Prompt written notice (and in any event within
thirty (30) days prior thereto) of any change in (i) any Guarantor’s
corporate name or in any trade name used to identify such Person in the conduct
of its business or in the ownership of its Properties, (ii)the location of any
Guarantor’s chief executive office or principal place of business, (iii) any
Guarantor’s identity or corporate structure or in the jurisdiction in which such
Person is incorporated or formed, (iv) any Guarantor’s jurisdiction of
organization or such Person’s organizational identification number in such
jurisdiction of organization, and (v) any Guarantor’s taxpayer
identification number.

       

      (n)           Production Report and
Operating Statements.

       

      (i)           Within
forty five (45) days after the end of each fiscal quarter, a report setting
forth, for each calendar month during the then current fiscal year to date, the
volume of production and sales attributable to production (and the prices at
which such sales were made and the revenues derived from such sales), including
gross production and net production after royalties, for each such calendar
month from the Oil and Gas Properties of the Credit Parties, and setting forth
the related ad valorem, severance and production taxes and operating expenses
attributable thereto and incurred for each such calendar month, and such other
related information as the Administrative Agent may reasonably
request.

       

      (ii)           Within
sixty (60) days after the end of each fiscal year of the Parent, a report
prepared by or on behalf of the Parent detailing (i) the projected production of
Hydrocarbons by the Credit Parties in each of the next four fiscal quarters and
the assumptions used in calculating such projections, (ii) an annual operating
budget for the Credit Parties for the forthcoming fiscal year, and (iii) the
projected capital expenditures to be incurred by the Credit Parties in each of
the next four fiscal quarters, with a breakdown of those capital expenditures to
be used for the development of proved undeveloped reserves in the Oil and Gas
Properties of the Credit Parties (including the Colombian Hydrocarbon
Properties), and the assumptions used in calculating such
projections.

       

      (o)           Notices of Certain
Changes.  Promptly, but in any event within five (5) Business
Days after the execution thereof, copies of any amendment, modification or
supplement to the certificate or articles of incorporation, by-laws, any
preferred stock designation or any other organic document any Credit
Party.

       

      (p)           Material
Changes.  Promptly after any material change in royalties or
taxes, or the confiscation, condemnation, seizure, forfeiture or expropriation
in respect of any Oil and Gas Properties of any Credit Party.

       

      (q)           Certificate of Financial
Officer – Environmental Laws; Corporate Social
Responsibility.  Promptly, but no later than ninety (90) days
following the end of each fiscal year of the Parent, a certificate of a
Responsible Officer of the Parent, in form and substance reasonably satisfactory
to the Administrative Agent, confirming compliance with Section 7.06, or details
of any potential or actual material deviation therefrom, together with details
of the actions being taken to respond to and remedy the
situation.

      
        
           

        

        
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      (r)           Notices under Concession
Agreements.  Promptly after receipt thereof, copies of any
requirement that any Colombian Branch receives from ANH or Ecopetrol S.A. that
results or may result in the early termination (caducidad) of one or more of
the Concession Agreements.

       

      (s)           Other Requested
Information.  Promptly following any request therefor, such
other information regarding the operations, business affairs and financial
condition of the Parent or any Subsidiary, or compliance with the terms of this
Agreement or any other Loan Document, as the Administrative Agent or any Lender
may reasonably request.

       

      Any
financial statement or filing required to be furnished pursuant to Section
8.01(a), Section 8.01(b) or Section 8.01(g) shall be deemed to have been
furnished on the date on which the Borrower has notified the Administrative
Agent that the Parent or the Borrower has filed such financial statement or
filing with either (i) the Securities and Exchange Commission and such financial
statement is available on the EDGAR website at www.sec.gov or (ii) the Canadian
Securities Administrators and such financial statement is available on the SEDAR
website at www.sedar.com.  Notwithstanding the foregoing, if the
Administrative Agent requests the Borrower to furnish paper copies of any such
financial statement or filing, the Borrower shall deliver such paper copies to
the Administrative Agent until the Administrative Agent gives written notice to
cease delivering such paper copies.

       

      Section
8.02         Notices of Material
Events.  The Parent will furnish to the Administrative Agent
and each Lender prompt written notice after a Responsible Officer of the Parent
or of the Borrower obtains knowledge of any of the following:

       

      (a)           the
occurrence of any Default;

       

      (b)           the
filing or commencement of, or the threat in writing of, any action, suit,
proceeding, investigation or arbitration by or before any arbitrator or
Governmental Authority against or affecting the Parent or any Affiliate thereof
not previously disclosed in writing to the Lenders or any material adverse
development in any action, suit, proceeding, investigation or arbitration
(whether or not previously disclosed to the Lenders) that, in either case, if
adversely determined, could reasonably be expected to result in liability in
excess of $1,000,000, not fully
covered by insurance, subject to normal deductibles; and

       

      (c)           any
other development that results in, or could reasonably be expected to result in,
a Material Adverse Effect.

       

      Each
notice delivered under this Section 8.02 shall be accompanied by a statement of
a Responsible Officer setting forth the details of the event or development
requiring such notice and any action taken or proposed to be taken with respect
thereto.

       

      Section
8.03         Existence; Conduct of
Business.  The Parent will, and will cause each other Credit
Party to, do or cause to be done all things necessary to preserve, renew and
keep in full force and effect its legal existence and the rights, licenses,
permits, privileges and franchises material to the conduct of its business and
maintain, if necessary, its qualification to do business in each other
jurisdiction in which its Oil and Gas Properties is located or the ownership of
its Properties requires such qualification, except where the failure to so
qualify could not reasonably be expected to have a Material Adverse Effect;
provided that
the foregoing shall not prohibit any merger, consolidation, liquidation or
dissolution permitted under Section 9.10.

      
        
           

        

        
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      Section
8.04         Payment of
Obligations.  The Parent will, and will cause each Subsidiary
to, pay its obligations, including Tax liabilities of the Parent and all of its
Subsidiaries before the same shall become delinquent or in default, except where
(a) the validity or amount thereof is being contested in good faith by
appropriate proceedings, (b) the Parent or such Subsidiary has set aside on its
books adequate reserves with respect thereto in accordance with GAAP and (c) the
failure to make payment pending such contest could not reasonably be expected to
result in a Material Adverse Effect or result in the seizure or levy of any
Property of the Parent or any Subsidiary.

       

      Section
8.05         Performance of Obligations
under Loan Documents.  The Borrower will pay the Notes and
Colombian Notes according to the reading, tenor and effect thereof, and the
Parent will, and will cause each other Credit Party to, do and perform every act
and discharge all of the obligations to be performed and discharged by them
under the Loan Documents, including, without limitation, this Agreement, at the
time or times and in the manner specified.

       

      Section
8.06          Operation and Maintenance of
Properties.  The Parent, at its own expense, will, and will
cause each other Credit Party to:

       

      (a)           operate
its Oil and Gas Properties and other material Properties or cause such Oil and
Gas Properties and other material Properties to be operated in a careful and
efficient manner in accordance with the practices of the industry and in
compliance with all applicable contracts and agreements and in compliance with
all Governmental Requirements, including, without limitation, applicable pro
ration requirements and Environmental Laws, and all applicable laws, rules and
regulations of every other Governmental Authority from time to time constituted
to regulate the development and operation of its Oil and Gas Properties and the
production and sale of Hydrocarbons and other minerals therefrom, except, in
each case, where the failure to comply could not reasonably be expected to have
a Material Adverse Effect.

       

      (b)           keep
and maintain all Property material to the conduct of its business in good
working order and condition, ordinary wear and tear excepted preserve, maintain
and keep in good repair, working order and efficiency (ordinary wear and tear
excepted) all of its material Oil and Gas Properties and other material
Properties, including, without limitation, all equipment, machinery and
facilities.

       

      (c)           promptly
pay and discharge, or make reasonable and customary efforts to cause to be paid
and discharged, all delay rentals, royalties, expenses and indebtedness accruing
under the leases or other agreements affecting or pertaining to its Oil and Gas
Properties and will do all other things necessary to keep unimpaired their
rights with respect thereto and prevent any forfeiture thereof or default
thereunder.

       

      (d)           promptly
perform or make reasonable and customary efforts to cause to be performed, in
accordance with industry standards, the obligations required by each and all of
the assignments, deeds, leases, sub-leases, contracts and agreements affecting
its interests in its Oil and Gas Properties and other material
Properties.

       

      (e)           to
the extent a Credit Party is not the operator of any Property, the Parent shall
use reasonable efforts to cause the operator to comply with this Section
8.06.

       

      Section
8.07         Insurance.  The
Parent will, and will cause each Subsidiary to, maintain, with financially sound
and reputable insurance companies, insurance in such amounts and against such
risks as are customarily maintained by companies engaged in the same or similar
businesses operating in the same or similar locations.  The loss
payable clauses or provisions in said insurance policy or policies insuring any
of the Collateral shall be endorsed in favor of and made payable to the
Administrative Agent as its interests may appear and such policies shall name
the Administrative Agent and the Lenders as “additional insureds” and provide
that the insurer will endeavor to give at least 30 days prior notice of any
cancellation to the Administrative Agent.

      
        
           

        

        
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      Section
8.08         Books and Records;
Inspection Rights.  The Parent will, and will cause each other
Credit Party to, keep proper books of record and account in which full, true and
correct entries are made of all dealings and transactions in relation to its
business and activities.  The Parent will, and will cause each other
Credit Party to, permit any representatives designated by the Administrative
Agent or any Lender, upon reasonable prior notice, to visit and inspect its
Properties, to examine and make extracts from its books and records, and to
discuss its affairs, finances and condition with its officers and independent
accountants, all at such reasonable times and as often as reasonably
requested.

       

      Section
8.09         Compliance with
Laws.  The Parent will, and will cause each Subsidiary to,
comply with all laws, rules, regulations and orders of any Governmental
Authority applicable to it or its Property, except (other than with respect to
bribery and anti-corruption Governmental Requirements) where the failure to do
so, individually or in the aggregate, could not reasonably be expected to result
in a Material Adverse Effect.

       

      Section
8.10          Environmental
Matters.

       

      (a)           The
Parent shall at its sole expense: (i) comply, and shall cause its Properties and
operations and each Subsidiary and each Subsidiary’s Properties and operations
to comply, with all applicable Environmental Laws, the breach of which could be
reasonably expected to have a Material Adverse Effect; (ii) not Release or
threaten to Release, and shall cause each Subsidiary not to Release or threaten
to Release, any Hazardous Material on, under, about or from any of the Parent’s
or its Subsidiaries’ Properties or any other property offsite the Property to
the extent caused by the Parent’s or any of its Subsidiaries’ operations except
in compliance with applicable Environmental Laws, the Release or threatened
Release of which could reasonably be expected to have a Material Adverse Effect;
(iii) timely obtain or file, and shall cause each Subsidiary to timely obtain or
file, all Environmental Permits, if any, required under applicable Environmental
Laws to be obtained or filed in connection with the operation or use of the
Parent’s or its Subsidiaries’ Properties, which failure to obtain or file could
reasonably be expected to have a Material Adverse Effect; (iv) promptly commence
and diligently prosecute to completion, and shall cause each Subsidiary to
promptly commence and diligently prosecute to completion, any assessment,
evaluation, investigation, monitoring, containment, cleanup, removal, repair,
restoration, remediation or other remedial obligations (collectively, the “Remedial Work”) in
the event any Remedial Work is required or reasonably necessary under applicable
Environmental Laws because of or in connection with the actual or suspected
past, present or future Release or threatened Release of any Hazardous Material
on, under, about or from any of the Parent’s or its Subsidiaries’ Properties,
which failure to commence and diligently prosecute to completion could
reasonably be expected to have a Material Adverse Effect; (v) conduct, and cause
its Subsidiaries to conduct, their respective operations and businesses in a
manner that will not expose any Property or Person to Hazardous Materials that
could reasonably be expected to form the basis for a claim for damages or
compensation; and (vi) establish and implement, and shall cause each
Subsidiary to establish and implement, such procedures as may be necessary to
continuously determine and assure that the Parent’s and its Subsidiaries’
obligations under this Section 8.10(a) are timely and fully satisfied, which
failure to establish and implement could reasonably be expected to have a
Material Adverse Effect.

       

      (b)           The
Parent will promptly, but in no event later than five days of the occurrence
thereof, notify the Administrative Agent and the Lenders in writing of any
threatened action, investigation or inquiry by any Governmental Authority or any
threatened demand or lawsuit by any Person against the Parent or any Subsidiary
or any of their Properties of which the Parent has knowledge in connection with
any Environmental Laws if the Parent could reasonably anticipate that such
action will result in liability (whether individually or in the aggregate) in
excess of $2,000,000, not fully covered by insurance, subject to normal
deductibles.

      
        
           

        

        
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      Section
8.11          Further
Assurances.

       

      (a)           The
Parent at its sole expense will, and will cause each other Credit Party to,
promptly execute and deliver to the Administrative Agent all such other
documents, agreements and instruments reasonably requested by the Administrative
Agent to comply with, cure any defects or accomplish the conditions precedent,
covenants and agreements of any Credit Party, as the case may be, in the Loan
Documents, including the Notes and the Colombian Notes, or to further evidence
and more fully describe the Collateral intended as security for the
Indebtedness, or to correct any omissions in this Agreement or the Security
Instruments, or to state more fully the obligations secured therein, or to
perfect, protect or preserve any Liens created pursuant to this Agreement or any
of the Security Instruments or the priority thereof, or to make any recordings,
file any notices or obtain any consents, all as may be reasonably necessary or
appropriate, in the sole discretion of the Administrative Agent, in connection
therewith.

       

      (b)           The
Parent and the Borrower each hereby authorizes the Administrative Agent to file
one or more financing or continuation statements (or the equivalent thereof),
and amendments thereto, relative to all or any part of the Mortgaged Property
without the signature of any Credit Party where permitted by law.  A
carbon, photographic or other reproduction of the Security Instruments or any
financing statement covering the Mortgaged Property or any part thereof shall be
sufficient as a financing statement where permitted by law.

       

      Section
8.12          Reserve
Reports.

       

      (a)           On
or before March 1 and September 1 of each year, commencing September 1, 2010,
the Borrower shall furnish to the Administrative Agent and the Lenders a Reserve
Report evaluating the Oil and Gas Properties of the Credit Parties as of the
immediately preceding December 31 and July 1.  The Reserve Report as
of December 31 of each year shall be prepared by one or more Approved Petroleum
Engineers, and the July 1 Reserve Report of each year shall be prepared by or
under the supervision of the chief engineer of the Borrower or the Parent who
shall certify such Reserve Report to be true and accurate and to have been
prepared in accordance with the procedures used in the immediately preceding
December 31 Reserve Report.

       

      (b)           In
the event of an Interim Redetermination, the Borrower shall furnish to the
Administrative Agent and the Lenders a Reserve Report prepared by or under the
supervision of the chief engineer of the Borrower or the Parent who shall
certify such Reserve Report to be true and accurate and to have been prepared in
accordance with the procedures used in the immediately preceding December 31
Reserve Report.  For any Interim Redetermination requested by the
Administrative Agent or the Borrower pursuant to Section 2.07(b), the Borrower
shall provide such Reserve Report with an “as of” date as required by the
Administrative Agent as soon as possible, but in any event no later than thirty
(30) days following the receipt of such request.

      
        
           

        

        
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      (c)           With
the delivery of each Reserve Report, the Borrower shall provide to the
Administrative Agent and the Lenders a certificate from a Responsible Officer
certifying that in all material respects: (i) the information contained in the
Reserve Report and any other information delivered in connection therewith is
true and correct, (ii) the Borrower or the other Credit Parties owns good and
defensible title to the Oil and Gas Properties evaluated in such Reserve Report
and such Properties are free of all Liens except for Liens permitted by Section
9.03, (iii) except as set forth on an exhibit to the certificate, on a net basis
there are no gas imbalances, take or pay or other prepayments with respect to
its Oil and Gas Properties evaluated in such Reserve Report which would require
any Credit Party to deliver Hydrocarbons either generally or produced from such
Oil and Gas Properties at some future time without then or thereafter receiving
full payment therefor, (iv) none of their Oil and Gas Properties have been sold
since the date of the last Borrowing Base determination except as set forth on
an exhibit to the certificate, which certificate shall list all of its Oil and
Gas Properties sold and in such detail as reasonably required by the
Administrative Agent, (v) attached to the certificate is a true and complete
list of (A) all Persons to whom the Credit Parties sell crude oil and any other
Hydrocarbons and (B) all contracts for the purchase and sale of crude oil and
any other Hydrocarbons to which any Credit Party is a party (including, without
limitation, each Offtake Agreement) and (vi) attached thereto is a schedule of
the Oil and Gas Properties evaluated by such Reserve Report that are included in
the Borrowing Base.

       

      Section
8.13          Title
Defects.  The Parent or the Borrower shall, promptly upon
becoming aware of the existence of any title defect or any Lien (other than
Excepted Liens) affecting any Oil and Gas Properties (including any Colombian
Hydrocarbon Property) of any Credit Party which has been given value in the most
recent Reserve Report, give the Administrative Agent prompt written notice of
such title defect or Lien, and in such case, the Parent shall, or shall cause
the applicable Credit Party to, undertake to take all steps necessary to cure
such title defect or discharge such Lien; provided that if the
applicable Credit Party does not cure such title defect or discharge such Lien
to the reasonable satisfaction of the Administrative Agent within sixty (60)
days following the earlier of (a) the date on which the Parent or the Borrower
shall have given the notice referred to in this Section, (b) the date a
Responsible Officer of the Parent or the Borrower has become aware of such title
defect or Lien and (c) the date that the Administrative Agent has notified the
Parent or the Borrower of such title defect or Lien, then the Administrative
Agent and the Lenders may cause the Borrowing Base to be reduced by an amount
equal to the value (or such portion thereof which has been impaired) assigned to
such Hydrocarbon Interests in the most recent Borrowing Base.

       

      Section
8.14          Guaranty;
Collateral.

       

      (a)           Guaranty.  The
Parent shall cause each Subsidiary Guarantor, within three (3) days of such
Person becoming a Subsidiary Guarantor, to guarantee the Indebtedness pursuant
to the Guaranty Agreement (by supplement, joinder or otherwise) and/or one or
more other guaranty agreements on terms satisfactory in form and substance to
the Administrative Agent.

       

      (b)           Liens and Material
Documents.  The Parent shall, and shall cause each other Credit
Party to (and with respect to any Person that becomes a Subsidiary Guarantor
after the Effective Date, within three (3) days of such Person becoming a
Subsidiary Guarantor), grant to the Administrative Agent for the benefit of the
Secured Parties to secure the Indebtedness (i) on or prior to the date that such
Credit Party enters into any Swap Agreement or Offtake Agreement, a first
priority, perfected Lien on all of its right, title and interest in and to such
Swap Agreement or Offtake Agreement, and (ii) a first priority, perfected Lien
on all of its right, title and interest in and to such Credit Party’s proved Oil
and Gas Properties (including, without limitation, in the economic rights in
each Concession Agreement  to which it is a party), material personal
property related thereto, and the following personal property within the meaning
of the UCC (and, in other jurisdictions not subject to the UCC, similar
property): Accounts; all Chattel Paper (whether Tangible Chattel Paper or
Electronic Chattel Paper); the Collection Accounts; all General Intangibles
(including, without limitation, all rights under insurance contracts, rights to
insurance proceeds and all proceeds of insurance); all Instruments (including,
without limitation, all Pledged Notes); all Letter-of-Credit Rights (whether or
not the letter of credit is evidenced by a writing); all books and records
pertaining to the foregoing; and to the extent not otherwise included, all
Proceeds, Supporting Obligations and products of any and all of the foregoing
and all collateral security and guarantees given by any Person with respect to
any of the foregoing; in each case pursuant to one or more Security Instruments
on terms satisfactory in form and substance to the Administrative
Agent.  In connection therewith, on or prior to the execution and
delivery by any Credit Party of any Swap Agreement or Offtake Agreement, the
Parent shall, and shall cause such Credit Party to, deliver to the
Administrative Agent a duly executed consent and agreement of the counterparty
to such Swap Agreement or the Offtaker under such Offtake Agreement (and in
either case, any other Person that is obligated (whether contingently or
otherwise) to make payments thereunder), as applicable, in form and substance
satisfactory to the Administrative Agent, pursuant to which such Person shall
consent to the grant of Liens contemplated hereby and agree to make all payments
under such Swap Agreement and Offtake Agreement to the Collection
Account.

      
        
           

        

        
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      (c)           Pledge of Equity
Interests.  The Parent shall, and shall cause its Subsidiaries
to, pledge all of the Equity Interests in the Borrower and each Subsidiary
Guarantor (and with respect to any Person that becomes a Subsidiary Guarantor
after the Effective Date, within three (3) days of such Person becoming a
Subsidiary Guarantor), pursuant to one or more Security Instruments on terms
satisfactory in form and substance to the Administrative Agent.

       

      (d)           Collection
Accounts.   The Parent shall, and shall cause each other
Credit Party to:

       

      (i)           deposit
or cause to be deposited directly into one or more Collection Accounts in US
Dollars or such other currency as the Majority Lenders may approve in their
reasonable discretion, all Dedicated Cash Receipts; and

       

      (ii)           grant
a first priority, perfected Lien to the Administrative Agent for the benefit of
the Secured Parties on all of its right, title and interest in and to each
Collection Account established in the name of such Credit Party pursuant to one
ore more Deposit Account Control Agreements and/or one or more other Security
Instruments on terms satisfactory in form and substance to the Administrative
Agent.

       

      (e)           Other
Actions.  In addition to the requirements of subsections (a)
through (d) above, the Parent shall, and shall cause each other Credit Party to,
(i) execute and deliver such other additional Security Instruments as may be
necessary or advisable in the reasonable opinion of the Administrative Agent in
connection therewith, (ii) execute and deliver such other closing documents,
certificates and legal opinions as shall be required by the Security
Instruments, by Governmental Requirements or as may be reasonably requested by
the Administrative Agent in connection therewith (including, the delivery of
original stock certificates evidencing the Equity Interests of the Borrower or a
Subsidiary Guarantor, together with appropriate undated stock powers for each
certificate duly executed in blank by the registered owner thereof), and (iii)
take all other action reasonably requested by the Administrative Agent,
including, without limitation, the filing of appropriate financing statements
(or the equivalent thereof) under the provisions of the Uniform Commercial Code,
applicable foreign, domestic or local laws, rules or regulations in each of the
offices where such filing is necessary or appropriate.

       

      Section
8.15          Unrestricted
Subsidiaries.  The Parent shall cause each Unrestricted
Subsidiary to:

       

      (a)           maintain
its own separate books and records and bank accounts, which are and will be, in
each case, separate and apart from those of any other Person;

       

      (b)           be,
and at all times hold itself out to the public as, a legal entity separate and
distinct from any other Person, maintain and utilize separate invoices and
checks bearing its own name and otherwise conduct its own business and own its
own assets and correct any known misunderstanding regarding its separate
identity;

      
        
           

        

        
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      (c)           refrain
from commingling its funds or other assets with those of any other
Person;

       

      (d)           refrain
from maintaining its assets in such a manner that would make it costly or
difficult to segregate, ascertain or identify its individual assets from those
of any other Person; and

       

      (e)           observe
all corporate formalities.

       

      ARTICLE
IX

      Negative
Covenants

       

      Until the
Commitments have expired or terminated and the principal of and interest on each
Loan and all fees payable hereunder and all other amounts payable under the Loan
Documents have been paid in full and all Letters of Credit have expired or
terminated and all LC Disbursements shall have been reimbursed, the Parent and
the Borrower each covenants and agrees with the Lenders that:

       

      Section
9.01          Financial
Covenants.

       

      (a)           Ratio of Total Debt to
EBITDAX.  The Parent will not, at any time, permit the ratio of
Total Debt as of such time to EBITDAX for the four fiscal quarters ending on the
last day of the fiscal quarter immediately preceding the date of determination
for which financial statements have been delivered to the Administrative Agent
hereunder to be greater than 2.75 to 1.0.

       

      (b)           Current
Ratio.  The Parent will not permit, as of the last day of any
fiscal quarter, the ratio of (i) consolidated current assets (including the
unused amount of the total Commitments, but excluding non-cash assets under ASC
Topic 815) to (ii) consolidated current liabilities (excluding non-cash
obligations under ASC Topic 815 and current maturities under this Agreement) to
be less than 1.0 to 1.0.

       

      Section
9.02          Debt.  From
and after the Effective Date, the Parent will not, and will not permit any
Subsidiary to, incur, create, assume or suffer to exist any Debt,
except:

       

      (a)           the
Notes or other Indebtedness arising under the Loan Documents or any guaranty of
or suretyship arrangement for the Notes or other Indebtedness arising under the
Loan Documents.

       

      (b)           Debt
of the Parent and the Subsidiaries existing on the date hereof that is reflected
in Schedule
9.02, and any refinancings, refundings, renewals or extensions thereof
(without increasing, or shortening the maturity of, the principal amount
thereof).

       

      (c)           Debt
under Capital Leases not to exceed $5,000,000.

       

      (d)           Debt
associated with bonds or surety obligations required by Governmental
Requirements in connection with the operation of its Oil and Gas
Properties.

       

      (e)           intercompany
Debt (i) between Credit Parties, (ii) between Unrestricted Subsidiaries, (iii)
owed by Credit Parties to Unrestricted Subsidiaries or (iv) owed by Unrestricted
Subsidiaries to Credit Parties to the extent permitted by Section 9.05(g)(ii);
provided that
such Debt is not held, assigned, transferred, negotiated or pledged to any
Person other than the Parent or one of its Wholly-Owned Subsidiaries; and provided further, that any
such Debt owed by a Credit Party shall be subordinated to the Indebtedness on
terms satisfactory to the Administrative Agent.

      
        
           

        

        
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      (f)           endorsements
of negotiable instruments for collection in the ordinary course of
business.

       

      (g)           other
Debt not to exceed $30,000,000 in the
aggregate at any one time outstanding.

       

      Section
9.03          Liens.  From
and after the Effective Date, the Parent will not, and will not permit any other
Credit Party to, create, incur, assume or permit to exist any Lien on any of its
Properties (now owned or hereafter acquired), except:

       

      (a)           Liens
securing the payment of any Indebtedness.

       

      (b)           Excepted
Liens.

       

      (c)           Liens
securing Capital Leases permitted by Section 9.02(c) but only on the Property
under lease.

       

      (d)           Liens
on Property not constituting Collateral securing Debt and not otherwise
permitted by the foregoing clauses of this Section 9.03; provided that the
aggregate principal or face amount of all Debt secured under this Section
9.03(d) shall not exceed $1,000,000 at any time.

       

      (e)           Liens
on cash up to an aggregate amount not to exceed $3,000,000 at any time, to
secure letters of credit permitted by Section 9.02(g).

       

      Section
9.04         Restricted
Payments.  The Parent will not, and will not permit any other
Credit Party to, declare or make, or agree to pay or make, directly or
indirectly, any Restricted Payment, return any capital to its stockholders or
make any distribution of its Property to its Equity Interest holders, except (a)
any Credit Party may declare and pay dividends with respect to its Equity
Interests payable solely in additional shares of its Equity Interests (other
than Disqualified Capital Stock); (b) any Credit Party (other than the Parent)
may declare and pay dividends ratably with respect to its Equity Interests to
the direct holders of its Equity Interests that are other Credit Parties; and
(c) the Parent may make Restricted Payments pursuant to and in accordance with
stock option plans or other benefit plans for management or employees of the
Parent and its Subsidiaries.

       

      Section
9.05         Investments, Loans and
Advances.  The Parent will not, and will not permit any other
Credit Party to, make or permit to remain outstanding any Investments in or to
any Person, except that the foregoing restriction shall not apply
to:

       

      (a)           Investments
reflected in the Financial Statements or which are disclosed to the Lenders in
Schedule
9.05.

       

      (b)           accounts
receivable arising in the ordinary course of business.

       

      (c)           direct
obligations of the United States, Canada, or any agency thereof, or obligations
guaranteed by the United States, Canada, or any agency thereof, in each case
maturing within one year from the date of creation thereof.

       

      (d)           commercial
paper maturing within one year from the date of creation thereof rated no lower
than A2 or P2 by S&P, Moody’s, Dominion Bond Rating Service Limited or
Canada Bond Rating Service..

      
        
           

        

        
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      (e)           deposits
maturing within one year from the date of creation thereof with, including
certificates of deposit issued by, any Lender or any office located in the
United States or Canada of any other bank or trust company which is organized
under the laws of the United States or any state thereof or Canada or any
province thereof, has capital, surplus and undivided profits aggregating at
least $100,000,000 (as of the date of such bank or trust company’s most recent
financial reports) and has a short term deposit rating of no lower than A2 or
P2, as such rating is set forth from time to time, by S&P, Moody’s, Dominion
Bond Rating Service Limited or Canada Bond Rating Service.

       

      (f)           deposits
in money market funds investing exclusively in Investments described in Section
9.05(c), Section 9.05(d) or Section 9.05(e).

       

      (g)           (i)
Investments made by any Credit Party in or to any other Credit Party and (ii)
Investments made by any Credit Party in or to any Unrestricted Subsidiary; provided that no proceeds of
Loans or Letters of Credit may be used, directly or indirectly, to make any
Investments in Subsidiaries organized under the laws of, or located or doing
business in, Argentina; provided further that in the case of
clause (ii) above: (A) Investments made by Credit Parties to Unrestricted
Subsidiaries from and after the date on which the amount of the Borrowing Base
first exceeds $20,000,000 (even if the amount of the Borrowing Base subsequently
falls to or below $20,000,000) shall not exceed $200,000,000 in the aggregate at
any time outstanding, (B) both before and after giving effect to any such
Investment, no Default shall exist, and (C) after giving effect to any such
Investment, either (1) the Borrowing Base Utilization Percentage shall not
exceed ninety percent (90%) and the Credit Parties shall have a minimum of
$100,000,000 in any combination of Cash and Cash Equivalents or (2) the
Borrowing Base Utilization Percentage shall not exceed fifty percent
(50%).

       

      (h)           subject
to the limits in Section 9.06(a), Investments (including, without limitation,
capital contributions) in general or limited partnerships or other types of
entities (each a “venture”) entered
into by a Credit Party with others in the ordinary course of business; provided that (i) any
such venture is engaged exclusively in oil and gas exploration, development,
production, processing and related activities, including transportation, (ii)
the interest in such venture is acquired in the ordinary course of business and
on fair and reasonable terms and (iii) such venture interests acquired and
capital contributions made (valued as of the date such interest was acquired or
the contribution made) do not exceed, in the aggregate at any time outstanding
an amount equal to $2,000,000.

       

      (i)           Investments
in direct ownership interests in additional Oil and Gas Properties and gas
gathering systems related thereto or related to farm-out, farm-in, joint
operating, joint venture or area of mutual interest agreements, gathering
systems, pipelines or other similar arrangements which are usual and customary
in the oil and gas exploration and production business; provided that no Default shall
have occurred and be continuing or would result therefrom.

       

      (j)           Investments
in stock, obligations or securities received in settlement of debts arising from
Investments permitted under this Section 9.05 owing to any Credit Party as a
result of a bankruptcy or other insolvency proceeding of the obligor in respect
of such debts or upon the enforcement of any Lien in favor of any Credit Party;
provided that
the Parent shall give the Administrative Agent prompt written notice in the
event that the aggregate amount of all Investments held at any one time under
this Section 9.05(j) exceeds $1,000,000.

       

      (k)           other
Investments not to exceed $50,000,000 in the aggregate at any time outstanding;
provided that: (ii) both before and after giving effect to any such Investment,
no Default exists, and (ii) after giving effect to any such Investment, the
Borrowing Base Utilization Percentage shall not exceed ninety percent
(90%).

      
        
           

        

        
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      Section
9.06          Nature of
Business;
Investments by Unrestricted Subsidiaries.

       

      (a)           The
Parent will not, and will not permit any Subsidiary to, allow any material
change to be made in the character of its business as an independent oil and gas
exploration and production company.

       

      (b)           The
Parent will not permit any Unrestricted Subsidiary to make Investments in any
Person except Investments (i) in Credit Parties or (ii) reasonably related to
the conduct of such Subsidiary’s business as an independent oil and gas
exploration and production company.

       

      Section
9.07          Limitation on
Leases.  The Parent will not, and will not permit any other
Credit Party to, create, incur, assume or suffer to exist any obligation for the
payment of rent or hire of Property of any kind whatsoever (real or personal but
excluding Capital Leases and leases of Hydrocarbon Interests), under leases or
lease agreements which would cause the aggregate amount of all payments made by
the Credit Parties pursuant to all such leases or lease agreements, including,
without limitation, any residual payments at the end of any lease, to exceed
$3,000,000 in
any period of twelve consecutive calendar months during the life of such
leases.

       

      Section
9.08          Proceeds of
Notes.  The Parent will not permit the proceeds of the Notes to
be used for any purpose other than those permitted by Section
7.19.  Neither the Borrower nor any Person acting on behalf of the
Borrower has taken or will take any action which might cause any of the Loan
Documents to violate Regulations T, U or X or any other regulation of the Board
or to violate Section 7 of the Securities Exchange Act of 1934 or any rule or
regulation thereunder, in each case as now in effect or as the same may
hereinafter be in effect.  If requested by the Administrative Agent,
the Parent or the Borrower will furnish to the Administrative Agent and each
Lender a statement to the foregoing effect in conformity with the requirements
of FR Form U-1 or such other form referred to in Regulation U, Regulation T or
Regulation X of the Board, as the case may be.

       

      Section
9.09          Sale or Discount of
Receivables.  Except for receivables obtained by any Credit
Party out of the ordinary course of business or the settlement of joint interest
billing accounts in the ordinary course of business or discounts granted to
settle collection of accounts receivable or the sale of defaulted accounts
arising in the ordinary course of business in connection with the compromise or
collection thereof and not in connection with any financing transaction, the
Parent will not, and will not permit any other Credit Party to, discount or sell
(with or without recourse) any of its notes receivable or accounts
receivable.

       

      Section
9.10          Mergers,
Etc.  The Parent will not, and will not permit any other Credit
Party to, merge into or with or consolidate with any other Person, or permit any
other Person to merge into or consolidate with it, or sell, transfer, lease or
otherwise dispose of (whether in one transaction or in a series of transactions)
all or substantially all of its Property to any other Person (whether now owned
or hereafter acquired) (any such transaction, a “consolidation”), or
liquidate or dissolve; provided that, so long as no
Default then exists, or would exist after giving effect thereto, and both before
and after giving effect thereto, each Credit Party is in compliance with Section
8.14:  (a) any Subsidiary Guarantor may participate in a consolidation
with the Borrower so long as the Borrower is the surviving Person or transferee,
(b) any Subsidiary Guarantor may participate in a consolidation with the Parent
so long as the Parent is the surviving Person or transferee, (c) any Subsidiary
Guarantor may participate in a consolidation with any Unrestricted Subsidiary so
long as the Subsidiary Guarantor is the surviving Person or transferee, and (d)
any Subsidiary Guarantor may participate in a consolidation with any other
Subsidiary Guarantor; provided that, in the
case of clause (d), the surviving Subsidiary Guarantor or transferee (the “Surviving Subsidiary
Guarantor”) shall either be organized in (i) the same jurisdiction as the
Subsidiary Guarantor that is not the surviving Subsidiary Guarantor or
transferee (the “Non-Surviving Subsidiary
Guarantor”), (ii) the same jurisdiction as the Surviving Subsidiary
Guarantor if the Property of the Non-Surviving Subsidiary Guarantor has a de minimus value or derives
substantially all of its value from the jurisdiction in which the Surviving
Subsidiary Guarantor is organized, (iii) any state of the United States of
America or province of Canada, or (iv) such other jurisdiction as approved by
the Majority Lenders.

      
        
           

        

        
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      Section
9.11          Disposition of
Properties.  The Parent will not, and will not permit any
Subsidiary to, sell, assign, farm-out, convey or otherwise dispose of or
transfer (including, without limitation, as  a result of a Casualty
Event) any Property (including, without limitation, any Equity Interests in any
Subsidiary Guarantor owing Oil and Gas Properties) except for:

       

      (a)           the
sale of Hydrocarbons in the ordinary course of business;

       

      (b)           farmouts
of undeveloped acreage to which no proved reserves are attributable and
assignments in connection with such farmouts;

       

      (c)           the
sale or transfer of equipment that is no longer necessary for the business of
the Parent or such Subsidiary or is replaced by equipment of at least comparable
value and use;

       

      (d)           the
sale or other disposition (including Casualty Events) of any Oil and Gas
Property or any interest therein or any Subsidiary Guarantor owning Oil and Gas
Properties; provided that (i)
100% of the consideration received in respect of such sale or other disposition
shall be cash, (ii) the consideration received in respect of such sale or other
disposition shall be equal to or greater than the Fair Market Value of the Oil
and Gas Property, interest therein or Subsidiary Guarantor subject of such sale
or other disposition (as reasonably determined by the board of directors of the
Parent and, if requested by the Administrative Agent, the Parent shall deliver a
certificate of a Responsible Officer of the Parent certifying to that effect),
(iii) if the Oil and Gas Property, interest therein or Subsidiary Guarantor
owning Oil and Gas Properties subject of such sale or other disposition has a
Fair Market Value in excess of five percent (5%) of the then effective Borrowing
Base, the Borrowing Base shall be reduced, effective immediately upon such sale
or disposition, by an amount equal to the value, if any, assigned such Property
in the then effective Borrowing Base, as determined by the Administrative Agent
and (iv) if any such sale or other disposition is of a Subsidiary Guarantor
owning Oil and Gas Properties, such sale or other disposition shall include all
the Equity Interests in such Subsidiary Guarantor;

       

      (e)           sales
and other dispositions of Properties to which the exceptions pursuant to Section
9.11(a) to (d) do not apply having a Fair Market Value not to exceed $1,000,000
during any 6-month period;

       

      (f)           any
Unrestricted Subsidiary may sell, transfer, lease or otherwise dispose of
any  of its Property other than Equity Interests (whether owned or
held by it directly or indirectly) in any Credit Party except as otherwise
expressly permitted by Section 9.11(d); and

       

      (g)           sales,
transfers, leases or dispositions of Property permitted by Section
9.10.

       

      Section
9.12          Environmental
Matters.  The Parent will not, and will not permit any
Subsidiary to, cause or permit any of its Property to be in violation of, or do
anything or permit anything to be done which will subject any such Property to a
Release or threatened Release of Hazardous Materials, exposure to any Hazardous
Materials, or to any Remedial Work under any Environmental Laws, assuming
disclosure to the applicable Governmental Authority of all relevant facts,
conditions and circumstances, if any, pertaining to such Property where such
violations, Release or threatened Release, exposure, or Remedial work could
reasonably be expected to have a Material Adverse Effect.

      
        
           

        

        
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      Section
9.13          Transactions with
Affiliates.  The Parent will not, and will not permit any other
Credit Party to, enter into any transaction, including, without limitation, any
purchase, sale, lease or exchange of Property or the rendering of any service,
with any Affiliate (other than the Borrower or any Subsidiary Guarantor) unless
such transactions are otherwise permitted under this Agreement and are upon fair
and reasonable terms no less favorable to it than it would obtain in a
comparable arm’s length transaction with a Person not an Affiliate.

       

      Section
9.14          Subsidiaries.  The
Parent will not, and will not permit any Subsidiary to, create or acquire any
additional Subsidiary unless the Parent gives prior written notice to the
Administrative Agent of such creation or acquisition and complies with Section
8.14.  The Parent shall not, and shall not permit any Subsidiary to,
sell, assign or otherwise dispose of any Equity Interests in any Subsidiary
Guarantor except in compliance with Section 9.11(d).

       

      Section
9.15          Restrictive
Agreements.  The Parent will not, and will not permit any other
Credit Party to, create, incur, assume or suffer to exist any contract,
agreement or understanding which in any way prohibits or restricts the granting,
conveying, creation or imposition of any Lien on any of its Property in favor of
the Administrative Agent and the Lenders, or restricts any Credit Party (other
than the Parent) from paying dividends or making any other distributions in
respect of its Equity Interests to the Parent or any other Credit Party, or
restricts the Parent or any other Credit Party from making loans or advances, or
transferring any Property, to the Parent or any other Credit Party, or which
requires the consent of or notice to other Persons in connection therewith,
other than (i) any such restrictions imposed by law or by the Loan Documents,
(ii) restrictions with respect to secured Debt permitted under Sections 9.02 and
9.03 to the extent such restrictions restrict the transfer of the collateral
provided under or in connection with such Debt, (iii) restrictions that restrict
in a customary manner the subletting, assignment or transfer of any Property
that is subject to a lease, farm-in agreement or farm-out agreement, license or
similar contract, or the assignment or transfer of any such lease, license or
other contract, (iv) restrictions pursuant to customary provisions restricting
dispositions of real property interests set forth in any reciprocal easement
agreement of the Borrower or any of its Subsidiaries and (v) restrictions with
respect to the disposition or distribution of Property in operating agreements,
joint venture agreements, development agreements, area of mutual interest
agreements and other agreements that are customary in the Hydrocarbon business
and entered into in the ordinary course of business.

       

      Section
9.16          Swap
Agreements.  The Parent will not, and will not permit any
Subsidiary to, enter into any Swap Agreements with any Person other
than  (a) Swap Agreements entered into by the Parent or the Borrower
in respect of commodities (i) with an Approved Counterparty and (ii) the
notional volumes for which (when aggregated with other commodity Swap Agreements
then in effect other than basis differential swaps on volumes already hedged
pursuant to other Swap Agreements) do not exceed, as of the date such Swap
Agreement is executed, 85% of the reasonably anticipated projected production
from proved, developed, producing Oil and Gas Properties of the Parent and the
Subsidiaries for each month during the period during which such Swap Agreement
is in effect for each of crude oil and natural gas, calculated separately, and
(b) Swap Agreements entered into by the Parent or the Borrower in respect of
interest rates with an Approved Counterparty, as follows: (i) Swap Agreements
effectively converting interest rates from fixed to floating, the notional
amounts of which (when aggregated with all other Swap Agreements of the Parent
and the Borrower then in effect effectively converting interest rates from fixed
to floating) do not exceed 50% of the then outstanding principal amount of the
Parent’s or Borrower’s Debt for borrowed money which bears interest at a fixed
rate and (ii) Swap Agreements entered into by the Parent or the Borrower
effectively converting interest rates from floating to fixed, the notional
amounts of which (when aggregated with all other Swap Agreements of the Parent
and the Borrower then in effect effectively converting interest rates from
floating to fixed) do not exceed 100% of the then outstanding principal amount
of the Parent’s Debt for borrowed money which bears interest at a floating
rate.  In no event shall any Swap Agreement contain any requirement,
agreement or covenant for the Parent or any Subsidiary to post collateral or
margin to secure obligations under such Swap Agreement or to cover market
exposures and neither the Parent nor the Borrower will enter into any Swap
Agreement unless concurrently therewith, the Parent or the Borrower (as
applicable) shall have delivered to the Administrative Agent a duly executed
consent and agreement of the counterparty to such Swap Agreement in form and
substance satisfactory to the Administrative Agent, pursuant to which such
counterparty shall (i) consent to the grant of Liens in all of the Parent’s or
the Borrower’s right, title and interest in and to such Swap Agreement to secure
the Indebtedness and (ii) agree to make all payments under such Swap Agreement
to the Collection Account.

      
        
           

        

        
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      Section
9.17          Material
Documents.  The Parent will not, and will not permit any other
Credit Party to, amend, modify, supplement, cancel or terminate, or waive
compliance with respect to, any Material Documents without the prior written
consent of the Majority Lenders (and provided that the
Parent promptly furnishes to the Administrative Agent a copy of such amendment,
modification, supplement, cancellation, termination or waiver).

       

      Section
9.18         Marketing
Activities.  The Parent will not, and will not permit any other
Credit Party to, enter into any contracts for the purchase and sale of crude oil
or any other Hydrocarbons other than Offtake Agreements.

       

      ARTICLE
X

      Events
of Default; Remedies

       

      Section
10.01        Events of
Default.  One or more of the following events shall constitute
an “Event of
Default”:

       

      (a)           the
Borrower shall fail to pay any principal of any Loan or any reimbursement
obligation in respect of any LC Disbursement when and as the same shall become
due and payable, whether at the due date thereof or at a date fixed for
prepayment thereof, by acceleration or otherwise.

       

      (b)           the
Borrower shall fail to pay any interest on any Loan or any fee or any other
amount (other than an amount referred to in Section 10.01(a)) payable under any
Loan Document, when and as the same shall become due and payable, and such
failure shall continue unremedied for a period of three Business
Days.

       

      (c)           any
representation or warranty made or deemed made by or on behalf of any Credit
Party in or in connection with any Loan Document or any amendment or
modification of any Loan Document or waiver under such Loan Document, or in any
report, certificate, financial statement or other document furnished pursuant to
or in connection with any Loan Document or any amendment or modification thereof
or waiver thereunder, shall prove to have been incorrect when made or deemed
made.

       

      (d)           any
Credit Party shall fail to observe or perform any covenant, condition or
agreement contained in Section 8.01(h), Section 8.01(i), Section 8.01(m),
Section 8.02, Section 8.03, Section 8.13, Section 8.14, Section 8.15 or in
Article IX.

       

      (e)           any
Credit Party shall fail to observe or perform any covenant, condition or
agreement contained in this Agreement (other than those specified in Section
10.01(a), Section 10.01(b) or Section 10.01(d)) or any other Loan Document, and
such failure shall continue unremedied for a period of 30 days after notice
thereof from the Administrative Agent to the Borrower (which notice will be
given at the request of any Lender).

      
        
           

        

        
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      (f)           any
Credit Party shall fail to make any payment (whether of principal or interest
and regardless of amount) in respect of any Material Indebtedness, when and as
the same shall become due and payable.

       

      (g)           any
event or condition occurs that results in any Material Indebtedness becoming due
prior to its scheduled maturity or that enables or permits (with or without the
giving of notice, the lapse of time or both) the holder or holders of any
Material Indebtedness or any trustee or agent on its or their behalf to cause
any Material Indebtedness to become due, or to require the Redemption thereof or
any offer to Redeem to be made in respect thereof, prior to its scheduled
maturity or require any Credit Party to make an offer in respect
thereof.

       

      (h)           an
involuntary proceeding shall be commenced or an involuntary petition shall be
filed seeking (i) liquidation, reorganization or other relief in respect of any
Credit Party or its debts, or of a substantial part of its assets, under
any  Federal, state or foreign bankruptcy, insolvency, receivership or
similar law now or hereafter in effect or (ii) the appointment of a receiver,
trustee, custodian, sequestrator, conservator or similar official for any Credit
Party or for a substantial part of its assets, and, in any such case, such
proceeding or petition shall continue undismissed for 30 days or an order or
decree approving or ordering any of the foregoing shall be entered.

       

      (i)           any
Credit Party shall (i) voluntarily commence any proceeding or file any petition
seeking liquidation, reorganization or other relief under any Federal, state or
foreign bankruptcy, insolvency, receivership or similar law now or hereafter in
effect, (ii) consent to the institution of, or fail to contest in a timely and
appropriate manner, any proceeding or petition described in Section 10.01(h),
(iii) apply for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for any Credit Party or for a
substantial part of its assets, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v) make a
general assignment for the benefit of creditors or (vi) take any action for the
purpose of effecting any of the foregoing; or any stockholder of the Parent or
the Borrower shall make any request or take any action for the purpose of
calling a meeting of the stockholders of the Parent or the Borrower to consider
a resolution to dissolve and wind-up the Parent or the Borrower’s
affairs.

       

      (j)           any
Credit Party shall become unable, admit in writing its inability or fail
generally to pay its debts as they become due.

       

      (k)           (i)
one or more judgments for the payment of money in an aggregate amount in excess
of $2,000,000
or (ii) any one or more non-monetary judgments that have, or could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect,
shall be rendered against any Credit Party or any combination thereof and the
same shall remain undischarged for a period of 30 consecutive days during which
execution shall not be effectively stayed, or any action shall be legally taken
by a judgment creditor to attach or levy upon any assets of the any Credit Party
to enforce any such judgment.

       

      (l)           the
Loan Documents after delivery thereof shall for any reason, except to the extent
permitted by the terms thereof, cease to be in full force and effect and valid,
binding and enforceable in accordance with their terms against any Credit Party
party thereto or shall be repudiated by any of them, or cease to create a valid
and perfected Lien of the priority required thereby on any of the Collateral
purported to be covered thereby, except to the extent permitted by the terms of
this Agreement, or any Credit Party or any of their Affiliates shall so state in
writing.

      
        
           

        

        
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      (m)           any
Governmental Authority shall (i) take any action to condemn, seize, nationalize
or appropriate any portion of the Property of any Credit Party (either with or
without payment of compensation) used in the exploration or development of
Properties and the Fair Market Value of such Property constitutes greater than
20% of the Borrowing Base then in effect, or (ii) take any action to
renegotiate, materially modify or increase the rate of taxation or the amount of
royalties payable by any Credit Party and such renegotiation, modification or
increase could reasonably be expected to result in a Material Adverse
Effect.

       

      (n)           the
any Credit Party defaults on any of its obligations under one or more Concession
Agreements relating to Oil and Gas Properties having a Fair Market Value greater
than $2,000,000, where the effect of such default is to entitle a ANH or
Ecopetrol, either immediately or with the giving of notice, the lapse of time or
a combination thereof, to early terminate (declaración de caducidad)
such Concession Agreement(s), or to take any other course of action with respect
thereto.

       

      (o)           any
Credit Party defaults on any of its obligations under an Offtake Agreement where
the effect of such default is to entitle the Offtaker under such Offtake
Agreement, either immediately or with the giving of notice, the lapse of time or
a combination thereof, to terminate such Offtake Agreement, or to take any other
course of action with respect thereto.

       

      (p)           a
Change in Control shall occur.

       

      Section
10.02        Remedies.

       

      (a)           In
the case of an Event of Default other than one described in Section 10.01(h),
Section 10.01(i) or Section 10.01(j), at any time thereafter during the
continuance of such Event of Default, the Administrative Agent may, and at the
request of the Majority Lenders, shall, by notice to the Borrower, take either
or both of the following actions, at the same or different times:  (i)
terminate the Commitments, and thereupon the Commitments shall terminate
immediately, and (ii) declare the Notes, the Colombian Notes and the Loans then
outstanding to be due and payable in whole (or in part, in which case any
principal not so declared to be due and payable may thereafter be declared to be
due and payable), and thereupon the principal of the Loans so declared to be due
and payable, together with accrued interest thereon and all fees and other
obligations of the Credit Parties accrued hereunder and under the Notes, the
Colombian Notes and the other Loan Documents (including, without limitation, the
payment of cash collateral to secure the LC Exposure as provided in Section
2.08(i)), shall become due and payable immediately, without presentment, demand,
protest, notice of intent to accelerate, notice of acceleration or other notice
of any kind, all of which are hereby waived by each Credit Party; and in case of
an Event of Default described in Section 10.01(h), Section 10.01(i) or Section
10.01(j), the Commitments shall automatically terminate and the Notes, the
Colombian Notes and the principal of the Loans then outstanding, together with
accrued interest thereon and all fees and the other obligations of the Credit
Parties accrued hereunder and under the Notes, the Colombian Notes and the other
Loan Documents (including, without limitation, the payment of cash collateral to
secure the LC Exposure as provided in Section 2.08(i)), shall automatically
become due and payable, without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Credit Parties.

       

      Declaration
of an Event of Default referred to in Section 10.01(h), Section 10.01(i) or
Section 10.01(j) shall not:  (1) prevent the commencement of a
proceeding under Law 1116 of 2006 (“Law 1116”) or any
Colombian Branch or the Borrower, whether in a voluntary or involuntary manner;
(2) be construed to mean that the purpose of this Section is to prevent or
create obstacles to prevent, directly or indirectly, that proceedings be
commenced in Colombia under Law 1116 with respect to any Colombian Branch or the
Borrower; (3) prohibit any Colombian Branch or the Borrower from negotiating or
entering into a restructuring agreement under Law 1116; or (4) impose any
restrictions or prohibitions, or unfavorable effects “efectos desfavorables” upon
any Colombian Branch or the Borrower for the negotiation or execution of a
restructuring agreement under Law 1116.  The rights of the Lenders
under this Section may not be exercised in connection with Section 10.01(h) and
Section 10.01(i) if and for so long as a proceeding is commenced or a petition
is filed in Colombia to commence a proceeding under Law 1116 with respect to any
Colombian Branch or the Borrower, whether in a voluntary or involuntary manner
or any Colombian Branch or the Borrowers engage in negotiations to enter into,
or enters into a restructuring agreement in Colombia under Law
1116.

      
        
           

        

        
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      (b)           In
the case of the occurrence of an Event of Default, the Administrative Agent and
the Lenders will have all other rights and remedies available at law and
equity.

       

      (c)           All
proceeds realized from the liquidation or other disposition of Collateral or
otherwise received after maturity of the Notes, whether by acceleration or
otherwise, shall be applied:

       

      (i)         first,
to payment or reimbursement of that portion of the Indebtedness constituting
fees, expenses and indemnities payable to the Administrative Agent and the
Global Coordinator in their capacities as such;

       

      (ii)        second,
pro rata to payment or reimbursement of that portion of the Indebtedness
constituting fees, expenses and indemnities payable to the Lenders;

       

      (iii)       third,
pro rata to payment of accrued interest on the Loans;

       

      (iv)       fourth,
pro rata to payment of principal outstanding on (A) the Loans and (B) the
Secured Swap Obligations owing to Secured Swap Parties;

       

      (v)        fifth,
to serve as cash collateral to be held by the Administrative Agent to secure the
LC Exposure;

       

      (vi)       sixth,
pro rata to any other Indebtedness; and

       

      (vii)      seventh,
any excess, after all of the Indebtedness shall have been indefeasibly paid in
full in cash, shall be paid to the Borrower or as otherwise required by any
Governmental Requirement.

       

      ARTICLE
XI

      The
Agents

       

      Section
11.01        Appointment;
Powers.  Each of the Lenders and the Issuing Bank hereby
irrevocably appoints the Administrative Agent as its agent and authorizes the
Administrative Agent to take such actions on its behalf and to exercise such
powers as are delegated to the Administrative Agent by the terms hereof and the
other Loan Documents, together with such actions and powers as are reasonably
incidental thereto.

      
        
           

        

        
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      Section
11.02        Duties and Obligations of
Administrative Agent.  The Administrative Agent shall not have
any duties or obligations except those expressly set forth in the Loan
Documents.  Without limiting the generality of the foregoing, (a) the
Administrative Agent shall not be subject to any fiduciary or other implied
duties, regardless of whether a Default has occurred and is continuing (the use
of the term “agent” herein and in the other Loan Documents with reference to the
Administrative Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable law;
rather, such term is used merely as a matter of market custom, and is intended
to create or reflect only an administrative relationship between independent
contracting parties), (b) the Administrative Agent shall have no duty to take
any discretionary action or exercise any discretionary powers, except as
provided in Section 11.03, and (c) except as expressly set forth herein, the
Administrative Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to any Credit Party
that is communicated to or obtained by the bank serving as Administrative Agent
or any of its Affiliates in any capacity.  The Administrative Agent
shall be deemed not to have knowledge of any Default unless and until written
notice thereof is given to the Administrative Agent by the Borrower or a Lender,
and shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with this
Agreement or any other Loan Document, (ii) the contents of any certificate,
report or other document delivered hereunder or under any other Loan Document or
in connection herewith or therewith, (iii) the performance or observance of any
of the covenants, agreements or other terms or conditions set forth herein or in
any other Loan Document, (iv) the validity, enforceability, effectiveness or
genuineness of this Agreement, any other Loan Document or any other agreement,
instrument or document, (v) the satisfaction of any condition set forth in
Article VI or elsewhere herein, other than to confirm receipt of items expressly
required to be delivered to the Administrative Agent or as to those conditions
precedent expressly required to be to the Administrative Agent’s satisfaction,
(vi) the existence, value, perfection or priority of any collateral security or
the financial or other condition of any Credit Party or any other obligor or
guarantor, or (vii) any failure by the Borrower or any other Person (other than
itself) to perform any of its obligations hereunder or under any other Loan
Document or the performance or observance of any covenants, agreements or other
terms or conditions set forth herein or therein.  For purposes of
determining compliance with the conditions specified in Article VI, each Lender
shall be deemed to have consented to, approved or accepted or to be satisfied
with, each document or other matter required thereunder to be consented to or
approved by or acceptable or satisfactory to a Lender unless the Administrative
Agent shall have received written notice from such Lender prior to the proposed
closing date specifying its objection thereto.

       

      Section
11.03        Action by Administrative
Agent.  The Administrative Agent shall have no duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated hereby or by the other Loan Documents
that the Administrative Agent is required to exercise in writing as directed by
the Majority Lenders (or such other number or percentage of the Lenders as shall
be necessary under the circumstances as provided in Section 12.02) and in all
cases the Administrative Agent shall be fully justified in failing or refusing
to act hereunder or under any other Loan Documents unless it shall (a) receive
written instructions from the Majority Lenders or the Lenders, as applicable,
(or such other number or percentage of the Lenders as shall be necessary under
the circumstances as provided in Section 12.02) specifying the action to be
taken and (b) be indemnified to its satisfaction by the Lenders against any and
all liability and expenses which may be incurred by it by reason of taking or
continuing to take any such action.  The instructions as aforesaid and
any action taken or failure to act pursuant thereto by the Administrative Agent
shall be binding on all of the Lenders.  If a Default has occurred and
is continuing, then the Administrative Agent shall take such action with respect
to such Default as shall be directed by the requisite Lenders in the written
instructions (with indemnities) described in this Section 11.03; provided that, unless
and until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default as it shall deem
advisable in the best interests of the Lenders.  In no event, however,
shall the Administrative Agent be required to take any action which exposes the
Administrative Agent to personal liability or which is contrary to this
Agreement, the Loan Documents or applicable law.  If a Default has
occurred and is continuing, the Global Coordinator shall have no obligation to
perform any act in respect thereof.  The Administrative Agent shall
not be liable for any action taken or not taken by it with the consent or at the
request of the Majority Lenders or the Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 12.02), and otherwise the Administrative Agent shall not be
liable for any action taken or not taken by it hereunder or under any other Loan
Document or under any other document or instrument referred to or provided for
herein or therein or in connection herewith or therewith including its own
ordinary negligence, except for its own gross negligence or willful
misconduct.

      
        
           

        

        
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      Section
11.04        Reliance by Administrative
Agent.  The Administrative Agent shall be entitled to rely
upon, and shall not incur any liability for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing believed
by it to be genuine and to have been signed or sent by the proper
Person.  The Administrative Agent also may rely upon any statement
made to it orally or by telephone and believed by it to be made by the proper
Person, and shall not incur any liability for relying thereon and each of the
Borrower, the Lenders and the Issuing Bank hereby waives the right to dispute
the Administrative Agent’s record of such statement, except in the case of gross
negligence or willful misconduct by the Administrative Agent.  The
Administrative Agent may consult with legal counsel (who may be counsel for the
Borrower), independent accountants and other experts selected by it, and shall
not be liable for any action taken or not taken by it in accordance with the
advice of any such counsel, accountants or experts.  The
Administrative Agent may deem and treat the payee of any Note as the holder
thereof for all purposes hereof unless and until a written notice of the
assignment or transfer thereof permitted hereunder shall have been filed with
the Administrative Agent.

       

      Section
11.05        Subagents.  The
Administrative Agent may perform any and all its duties and exercise its rights
and powers by or through any one or more sub-agents appointed by the
Administrative Agent.  The Administrative Agent and any such sub-agent
may perform any and all its duties and exercise its rights and powers through
their respective Related Parties.  The exculpatory provisions of the
preceding Sections of this Article XI shall apply to any such sub-agent and to
the Related Parties of the Administrative Agent and any such sub-agent, and
shall apply to their respective activities in connection with the syndication of
the credit facilities provided for herein as well as activities as
Administrative Agent.

       

      Section
11.06        Resignation or Removal of
Administrative Agent.  Subject to the appointment and
acceptance of a successor Administrative Agent as provided in this Section
11.06, the Administrative Agent may resign at any time by notifying the Lenders,
the Issuing Bank and the Borrower, and the Administrative Agent may be removed
at any time with or without cause by the Majority Lenders.  Upon any
such resignation or removal, the Majority Lenders shall have the right, in
consultation with the Borrower, to appoint a successor.  If no
successor shall have been so appointed by the Majority Lenders and shall have
accepted such appointment within 30 days after the retiring Agent gives notice
of its resignation or removal of the retiring Agent, then the retiring Agent
may, on behalf of the Lenders and the Issuing Bank, appoint a successor Agent
which shall be a bank with an office in New York, New York, or an Affiliate of
any such bank.  Upon the acceptance of its appointment as Agent
hereunder by a successor, such successor shall succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations
hereunder.  The fees payable by the Borrower to a successor Agent
shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrower and such successor.  After the Agent’s
resignation hereunder, the provisions of this Article XI and Section 12.03 shall
continue in effect for the benefit of such retiring Agent, its sub-agents and
their respective Related Parties in respect of any actions taken or omitted to
be taken by any of them while it was acting as Agent.

       

      Section
11.07        Agents as
Lenders.  Each bank serving as an Agent hereunder shall have
the same rights and powers in its capacity as a Lender as any other Lender and
may exercise the same as though it were not an Agent, and such bank and its
Affiliates may accept deposits from, lend money to and generally engage in any
kind of business with any Credit Party or Affiliate thereof as if it were not an
Agent hereunder.

      
        
           

        

        
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      Section
11.08        No
Reliance.  Each Lender acknowledges that it has, independently
and without reliance upon the Administrative Agent, any other Agent or any other
Lender and based on such documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement and each
other Loan Document to which it is a party.  Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent, any other Agent or any other Lender and based on such
documents and information as it shall from time to time deem appropriate,
continue to make its own decisions in taking or not taking action under or based
upon this Agreement, any other Loan Document, any related agreement or any
document furnished hereunder or thereunder.  The Agents shall not be
required to keep themselves informed as to the performance or observance by any
Credit Party of this Agreement, the Loan Documents or any other document
referred to or provided for herein or to inspect the Properties or books of any
Credit Party.  Except for notices, reports and other documents and
information expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, no Agent or the Bookrunner or the Arranger shall
have any duty or responsibility to provide any Lender with any credit or other
information concerning the affairs, financial condition or business of the
Borrower (or any of its Affiliates) which may come into the possession of such
Agent or any of its Affiliates.  In this regard, each Lender
acknowledges that Vinson & Elkins L.L.P. is acting in this transaction as
special counsel to the Administrative Agent only, except to the extent otherwise
expressly stated in any legal opinion or any Loan Document.  Each
other party hereto will consult with its own legal counsel to the extent that it
deems necessary in connection with the Loan Documents and the matters
contemplated therein.

       

      Section
11.09        Administrative Agent May
File Proofs of Claim.  In case of the pendency of any
receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or other judicial proceeding relative to any Credit
Party, the Administrative Agent (irrespective of whether the principal of any
Loan shall then be due and payable as herein expressed or by declaration or
otherwise and irrespective of whether the Administrative Agent shall have made
any demand on the Borrower) shall be entitled and empowered, by intervention in
such proceeding or otherwise:

       

      (a)           to
file and prove a claim for the whole amount of the principal and interest owing
and unpaid in respect of the Loans and all other Indebtedness that are owing and
unpaid and to file such other documents as may be necessary or advisable in
order to have the claims of the Lenders and the Administrative Agent (including
any claim for the reasonable compensation, expenses, disbursements and advances
of the Lenders and the Administrative Agent and their respective agents and
counsel and all other amounts due the Lenders and the Administrative Agent under
Section 12.03) allowed in such judicial proceeding; and

       

      (b)           to
collect and receive any monies or other property payable or deliverable on any
such claims and to distribute the same;

       

      and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Lender to make such payments to the Administrative Agent and, in the event that
the Administrative Agent shall consent to the making of such payments directly
to the Lenders, to pay to the Administrative Agent any amount due for the
reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Section 12.03.

       

      Nothing
contained herein shall be deemed to authorize the Administrative Agent to
authorize or consent to or accept or adopt on behalf of any Lender any plan of
reorganization, arrangement, adjustment or composition affecting the
Indebtedness or the rights of any Lender or to authorize the Administrative
Agent to vote in respect of the claim of any Lender in any such
proceeding.

      
        
           

        

        
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      Section
11.10        Authority of Administrative
Agent to Release Collateral and Liens.

       

      (a)           Each
Lender and the Issuing Bank hereby authorizes the Administrative Agent to
release any Collateral that is permitted to be sold or released pursuant to the
terms of the Loan Documents.  Each Lender and the Issuing Bank hereby
authorizes the Administrative Agent to execute and deliver to the Borrower, at
the Borrower’s sole cost and expense, any and all releases of Liens, termination
statements, assignments or other documents reasonably requested by the Borrower
in connection with any sale or other disposition of Property to the extent such
sale or other disposition is permitted by the terms of Section 9.11 or is
otherwise authorized by the terms of the Loan Documents.

       

      (b)           The
grant of a security interest under the Security Instruments and all of rights,
powers and remedies in connection therewith shall remain in full force and
effect until the Administrative Agent has (i) retransferred and delivered all
Collateral in its possession to the relevant Credit Parties and (ii) executed a
written release or termination statement and reassigned to the relevant Credit
Parties without recourse or warranty any remaining Collateral and all rights
conveyed thereby.  Upon the date that the Indebtedness shall have been
indefeasibly paid in full in cash, no Letter of Credit shall be outstanding, all
of the Commitments shall have terminated, all Secured Swap Agreements shall have
been terminated or novated to third parties and the irrevocable and indefeasible
payment in full in cash or posting of acceptable substitute collateral in
respect of all obligations or amounts that are owed to any Secured Swap Party
under such Secured Swap Agreements shall have occurred as required by the terms
thereof or in connection with any such novation, and the Credit Parties shall
have fully complied with all covenants and agreements of the Security
Instruments, the Administrative Agent, at the written request and expense of the
Borrower, will promptly release, reassign and transfer the Collateral to the
relevant Credit Parties.

       

      (c)           At
the request and sole expense of the Borrower, a Credit Party other than the
Borrower or the Parent shall be released from its obligations under the Security
Instruments in the event that all of the Equity Interests of such Credit Party
shall be sold, transferred or otherwise disposed of in a transaction permitted
by this Agreement; provided that the
Borrower shall have delivered to the Administrative Agent, at least ten (10)
Business Days prior to the date of the proposed release, a written notice of a
Responsible Officer of the Borrower identifying the relevant Credit Party and
the terms of the sale or other disposition in reasonable detail, including the
price thereof and any expenses in connection therewith, together with a
certification by the Borrower stating that such transaction is in compliance
with this Agreement and the other Loan Documents.

       

      Section
11.11        Colombian Security
Documents.  Each Secured Party hereby authorizes the
Administrative Agent, on behalf of and for the benefit of the Secured Parties,
to be the agent for and representative of the Secured Parties with respect to
the Collateral and the Colombian Security Documents and any other Security
Instruments governed by the laws of Colombia.  Each Secured Party
further authorizes the Administrative Agent to execute on its behalf, directly
or through attorneys-in-fact duly appointed for such purposes (including,
without limitation, pursuant to a power of attorney in form and substance
satisfactory to the Administrative Agent), and to accept the benefits of, each
of the Colombian Security Documents and any other agreements or documents as may
be necessary or advisable in connection with the grant of, or attachment or
perfection of, the security interest granted to the Administrative Agent, for
the benefit of the Secured Parties, pursuant to the Colombian Security Documents
or any other Security Instruments governed by the laws of Colombia.

       

      Section
11.12        The Global Coordinator,
Bookrunner and Arranger.  The Global Coordinator, the
Bookrunner and the Arranger shall have no duties, responsibilities or
liabilities under this Agreement and the other Loan Documents other than their
duties, responsibilities and liabilities in their capacity as Lenders
hereunder.

      
        
           

        

        
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      ARTICLE
XII

      Miscellaneous

       

      Section
12.01        Notices.

       

      (a)           Except
in the case of notices and other communications expressly permitted to be given
by telephone (and subject to Section 12.01(b)), all notices and other
communications provided for herein shall be in writing and shall be delivered by
hand or overnight courier service, mailed by certified or registered mail or
sent by telecopy, as follows:

       

      (i)        if
to the Borrower, to it at 300, 611 - 10th Avenue S.W.,
Calgary, Alberta, Canada Attention of Chief Financial
Officer (Telecopy No. (403)
265-3242);

       

      (ii)       if
to the Parent, to it at 300, 611 - 10th Avenue S.W.,
Calgary, Alberta, Canada Attention of Chief Financial
Officer (Telecopy No. (403)
265-3242);

       

      (iii)      if
to the Administrative Agent and Global Coordinator, to it at 1200 Smith Street, Suite
3100, Houston, Texas 77002, United States of America, Attention of Juan Carlos
Sandoval (Telecopy No. 713-659-6915), with
a copy to 1200 Smith
Street, Suite 3100, Houston, Texas 77002, United States of America,
Attention of Donna
Verwold (Telecopy No. 713-659-6915), with
a copy to 787 Seventh Avenue, New York, New York 10020, Attention of Anna
Seghini (Telecopy No. 212-841-2537);

       

      (iv)      if
to the Issuing Bank, to it at 1200 Smith Street, Suite
3100, Houston, Texas 77002, United States of America, Attention of Juan Carlos
Sandoval (Telecopy No. 713-659-6915), with
a copy to 1200 Smith
Street, Suite 3100, Houston, Texas 77002, United States of America,
Attention of Donna
Verwold (Telecopy No. 713-659-6915), with
a copy to 787 Seventh Avenue, New York, New York 10020, Attention of Anna
Seghini (Telecopy No. 212-841-2537);
and

       

      (v)       if
to any other Lender, to it at its address (or telecopy number) set forth in its
Administrative Questionnaire.

       

      (b)           Notices
and other communications to the Lenders hereunder may be delivered or furnished
by electronic communications pursuant to procedures approved by the
Administrative Agent; provided that the
foregoing shall not apply to notices pursuant to Articles II, III, IV and V
unless otherwise agreed by the Administrative Agent and the applicable
Lender.  The Administrative Agent or the Borrower may, in its
discretion, agree to accept notices and other communications to it hereunder by
electronic communications pursuant to procedures approved by it; provided that
approval of such procedures may be limited to particular notices or
communications.

       

      (c)           Any
party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto.  All
notices and other communications given to any party hereto in accordance with
the provisions of this Agreement shall be deemed to have been given on the date
of receipt.

      
        
           

        

        
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      Section
12.02        Waivers;
Amendments.

       

      (a)           No
failure on the part of the Administrative Agent, any other Agent, the Issuing
Bank or any Lender to exercise and no delay in exercising, and no course of
dealing with respect to, any right, power or privilege, or any abandonment or
discontinuance of steps to enforce such right, power or privilege, under any of
the Loan Documents shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, power or privilege under any of the Loan
Documents preclude any other or further exercise thereof or the exercise of any
other right, power or privilege.  The rights and remedies of the
Administrative Agent, any other Agent, the Issuing Bank and the Lenders
hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise
have.  No waiver of any provision of this Agreement or any other Loan
Document or consent to any departure by the Borrower therefrom shall in any
event be effective unless the same shall be permitted by Section 12.02(b), and
then such waiver or consent shall be effective only in the specific instance and
for the purpose for which given.  Without limiting the generality of
the foregoing, the making of a Loan or issuance of a Letter of Credit shall not
be construed as a waiver of any Default, regardless of whether the
Administrative Agent, any other Agent, any Lender or the Issuing Bank may have
had notice or knowledge of such Default at the time.

       

      (b)           Neither
this Agreement nor any provision hereof nor any Security Instrument nor any
provision thereof may be waived, amended or modified except pursuant to an
agreement or agreements in writing entered into by the Borrower and the Majority
Lenders or by the Borrower and the Administrative Agent with the consent of the
Majority Lenders; provided that no such
agreement shall (i) increase the Commitment or the Maximum Credit Amount of any
Lender without the written consent of such Lender, (ii) increase the Borrowing
Base without the written consent of each Lender (other than any Defaulting
Lender), decrease or maintain the Borrowing Base without the consent of the
Majority Lenders, or modify Section 2.07 in any manner without the consent of
each Lender (other than any Defaulting Lender); provided that a
Scheduled Redetermination may be postponed by the Majority Lenders, (iii) reduce
the principal amount of any Loan or LC Disbursement or reduce the rate of
interest thereon, or reduce any fees payable hereunder, or reduce any other
Indebtedness hereunder or under any other Loan Document, without the written
consent of each Lender affected thereby, (iv) postpone the scheduled date of
payment or prepayment of the principal amount of any Loan or LC Disbursement, or
any interest thereon, or any fees payable hereunder, or any other Indebtedness
hereunder or under any other Loan Document, or reduce the amount of, waive or
excuse any such payment, or postpone or extend the Termination Date without the
written consent of each Lender affected thereby, (v) change Section 4.01(b) or
Section 4.01(c) in a manner that would alter the pro rata sharing of payments
required thereby, without the written consent of each Lender, (vi) waive or
amend Section 3.04(c), Section 6.01, Section 8.14, Section 10.02(c) or Section
12.15 or change the definition of the term “Material Subsidiary”, “Subsidiary”,
or “Unrestricted Subsidiary”, without the written consent of each Lender, (vii)
release any Guarantor (except as set forth in the Guaranty Agreement), release
all or substantially all of the Collateral (other than as provided in Section
11.10), without the written consent of each Lender, or (viii) change any of the
provisions of this Section 12.02(b) or the definitions of “Majority Lenders” or
any other provision hereof specifying the number or percentage of Lenders
required to waive, amend or modify any rights hereunder or under any other Loan
Documents or make any determination or grant any consent hereunder or any other
Loan Documents, without the written consent of each Lender; provided further that
no such agreement shall amend, modify or otherwise affect the rights or duties
of the Administrative Agent, any other Agent, or the Issuing Bank hereunder or
under any other Loan Document without the prior written consent of the
Administrative Agent, such other Agent or the Issuing Bank, as the case may
be.  Notwithstanding the foregoing, any supplement to Schedule 1.02(b)
(Eligible Buyers) or Schedule 7.13
(Subsidiaries) shall be effective simply by delivering to the Administrative
Agent a supplemental schedule clearly marked as such and, upon receipt, the
Administrative Agent will promptly deliver a copy thereof to the
Lenders.

      
        
           

        

        
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      Section
12.03        Expenses, Indemnity; Damage
Waiver.

       

      (a)           The
Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent and its Affiliates, including, without limitation, the
reasonable fees, charges and disbursements of counsel and other outside
consultants for the Administrative Agent, the reasonable travel, photocopy,
mailing, courier, telephone and other similar expenses, and the cost of
environmental invasive and non-invasive assessments and audits and surveys and
appraisals, in connection with the syndication of the credit facilities provided
for herein, the preparation, negotiation, execution, delivery and administration
(both before and after the execution hereof and including advice of counsel to
the Administrative Agent as to the rights and duties of the Administrative Agent
and the Lenders with respect thereto) of this Agreement and the other Loan
Documents and any amendments, modifications or waivers of or consents related to
the provisions hereof or thereof (whether or not the transactions contemplated
hereby or thereby shall be consummated), (ii) all costs, expenses, Taxes,
assessments and other charges incurred by any Agent or any Lender in connection
with any filing, registration, recording or perfection of any security interest
contemplated by this Agreement or any Security Instrument or any other document
referred to therein, (iii) all reasonable out-of-pocket expenses incurred by the
Issuing Bank in connection with the issuance, amendment, renewal or extension of
any Letter of Credit or any demand for payment thereunder, (iv) all
out-of-pocket expenses incurred by any Agent, the Issuing Bank or any Lender,
including the fees, charges and disbursements of any counsel for any Agent, the
Issuing Bank or any Lender, in connection with the enforcement or protection of
its rights in connection with this Agreement or any other Loan Document,
including its rights under this Section 12.03, or in connection with the Loans
made or Letters of Credit issued hereunder, including, without limitation, all
such out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.

       

      (b)           The
Borrower shall indemnify each Agent, the Bookrunner, the Arranger, the Issuing
Bank and each Lender, and each Related Party of any of the foregoing Persons
(each such Person being called an “Indemnitee”) against,
and defend and hold each Indemnitee harmless from, any and all losses, claims,
damages, penalties, liabilities and related expenses, including the fees,
charges and disbursements of any counsel for any Indemnitee, incurred by or
asserted against any Indemnitee arising out of, in connection with, or as a
result of (i) the execution or delivery of this agreement or any other Loan
document or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto or the parties to any other Loan Document of
their respective obligations hereunder or thereunder or the consummation of the
transactions contemplated hereby or by any other Loan Document, (ii) the failure
of any Credit Party to comply with the terms of any Loan Document, including
this Agreement, or with any Governmental Requirement, (iii) any inaccuracy of
any representation or any breach of any warranty or covenant of any Credit Party
set forth in any of the Loan Documents or any instruments, documents or
certifications delivered in connection therewith, (iv) any Loan or Letter of
Credit or the use of the proceeds therefrom, including, without limitation, (A)
any refusal by the Issuing Bank to honor a demand for payment under a Letter of
Credit if the documents presented in connection with such demand do not strictly
comply with the terms of such Letter of Credit, or (B) the payment of a drawing
under any Letter of Credit notwithstanding the non-compliance, non-delivery or
other improper presentation of the documents presented in connection therewith,
(v) any other aspect of the Loan Documents, (vi) the operations of the business
of the Credit Parties by the Credit Parties, (vii) any assertion that the
Lenders were not entitled to receive the proceeds received pursuant to the
Security Instruments, (viii) any Environmental Law applicable to the Credit
Parties or any of their Properties or operations, including, the presence,
generation, storage, release, threatened release, use, transport, disposal,
arrangement of disposal or treatment of Hazardous Materials on or at any of
their Properties, (ix) the breach or non-compliance by any Credit Party with any
Environmental Law applicable to any Credit Party, (x) the past ownership by any
Credit Party of any of its Properties or past activity on any of their
Properties which, though lawful and fully permissible at the time, could result
in present liability, (xi) the presence, use, release, storage, treatment,
disposal, generation, threatened release, transport, arrangement for transport
or arrangement for disposal of Hazardous Materials on or at any of the
Properties owned or operated by any Credit Party or any actual or alleged
presence or release of Hazardous Materials on or from any Property owned or
operated by any Credit Party, (xii) any environmental liability related in any
way to any Credit Party, or (xiii) any other environmental, health or safety
condition in connection with the Loan Documents, or (xiv) any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory and
regardless of whether any Indemnitee is a party thereto, and such indemnity
shall extend to each Indemnitee notwithstanding the sole or concurrent
negligence of every kind or character whatsoever, whether active or passive,
whether an affirmative act or an omission, including without limitation, all
types of negligent conduct identified in the restatement (second) of torts of
one or more of the Indemnitees or by reason of strict liability imposed without
fault on any one or more of the Indemnitees; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or wilful misconduct of such
Indemnitee.

      
        
           

        

        
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      (c)           To
the extent that the Borrower fails to pay any amount required to be paid by it
to any Agent, the Bookrunner, the Arranger or the Issuing Bank under Section
12.03(a) or (b), each Lender severally agrees to pay to such Agent, the
Bookrunner, the Arranger or the Issuing Bank, as the case may be, such Lender’s
Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount;
provided that
the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against such
Agent, the Bookrunner, the Arranger or the Issuing Bank in its capacity as
such.

       

      (d)           To
the extent permitted by applicable law, the Borrower and the Parent shall not
assert, and each hereby waives, any claim against any Indemnitee, on any theory
of liability, for special, indirect, consequential or punitive damages (as
opposed to direct or actual damages) arising out of, in connection with, or as a
result of, this Agreement, any other Loan Document or any agreement or
instrument contemplated hereby or thereby, the Transactions, any Loan or Letter
of Credit or the use of the proceeds thereof.

       

      (e)           All
amounts due under this Section 12.03 shall be payable not later than three (3) days
after written demand therefor.

       

      Section
12.04        Successors and
Assigns.

       

      (a)           The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted hereby
(including any Affiliate of the Issuing Bank that issues any Letter of Credit),
except that (i) the Borrower may not assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of each Lender
(and any attempted assignment or transfer by the Borrower without such consent
shall be null and void) and (ii) no Lender may assign or otherwise transfer its
rights or obligations hereunder except in accordance with this Section
12.04.  Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit), Participants (to the extent
provided in Section 12.04(c)) and, to the extent expressly contemplated hereby,
the Related Parties of each of the Administrative Agent, the Issuing Bank and
the Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.

       

      (b)           (i)
Subject to the conditions set forth in Section 12.04(b)(ii), any Lender may
assign to one or more assignees all or a portion of its rights and obligations
under this Agreement (including all or a portion of its Commitment and the Loans
at the time owing to it) with the prior written consent (such consent not to be
unreasonably withheld) of:

      
        
           

        

        
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      (A)        the
Borrower; provided that no
consent of the Borrower shall be required if such assignment is to a Lender, an
Affiliate of a Lender, an Approved Fund or, if an Event of Default has occurred
and is continuing, is to any other assignee; and

       

      (B)         the
Administrative Agent; provided that no
consent of the Administrative Agent shall be required for an assignment to an
assignee that is a Lender immediately prior to giving effect to such
assignment.

       

      (ii)           Assignments
shall be subject to the following additional conditions:

       

      (A)         except
in the case of an assignment to a Lender or an Affiliate of a Lender or an
assignment of the entire remaining amount of the assigning Lender’s Commitment
or Loans, the amount of the Commitment or Loans of the assigning Lender subject
to each such assignment (determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to the Administrative Agent) shall
not be less than $5,000,000 unless each of the Borrower and the Administrative
Agent otherwise consent; provided that no such
consent of the Borrower shall be required if an Event of Default has occurred
and is continuing;

       

      (B)          each
partial assignment shall be made as an assignment of a proportionate part of all
the assigning Lender’s rights and obligations under this Agreement;

       

      (C)          the
parties to each assignment shall execute and deliver to the Administrative Agent
an Assignment and Assumption, together with a processing and recordation fee of
$3,500; and

       

      (D)          the
assignee, if it shall not be a Lender, shall deliver to the Administrative Agent
an Administrative Questionnaire.

       

      (iii)          Subject
to Section 12.04(b)(iv) and the acceptance and recording thereof, from and after
the effective date specified in each Assignment and Assumption the assignee
thereunder shall be a party hereto and, to the extent of the interest assigned
by such Assignment and Assumption, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Section 5.01, Section 5.02, Section 5.03 and
Section 12.03).  Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 12.04
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with Section
12.04(c).

       

      (iv)          The
Administrative Agent, acting for this purpose as an agent of the Borrower, shall
maintain at one of its offices a copy of each Assignment and Assumption
delivered to it and a register for the recordation of the names and addresses of
the Lenders, and the Maximum Credit Amount of, and principal amount of the Loans
and LC Disbursements owing to, each Lender pursuant to the terms hereof from
time to time (the “Register”).  The
entries in the Register shall be conclusive, and the Borrower, the
Administrative Agent, the Issuing Bank and the Lenders may treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary.  The Register shall be available for inspection by the
Borrower, the Issuing Bank and any Lender, at any reasonable time and from time
to time upon reasonable prior notice.  In connection with any changes
to the Register, if necessary, the Administrative Agent will reflect the
revisions on Annex
I and forward a copy of such revised Annex I to the
Borrower, the Issuing Bank and each Lender.

      
        
           

        

        
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    (v)           Upon
its receipt of a duly completed Assignment and Assumption executed by an
assigning Lender and an assignee, the assignee’s completed Administrative
Questionnaire (unless the assignee shall already be a Lender hereunder), the
processing and recordation fee referred to in Section 12.04(a) and any written
consent to such assignment required by Section 12.04(a), the Administrative
Agent shall accept such Assignment and Assumption and record the information
contained therein in the Register.  No assignment shall be effective
for purposes of this Agreement unless it has been recorded in the Register as
provided in this Section 12.04(a).

     

    (c)

     

    (i)      
     Any Lender may, without the consent of the
Borrower, the Administrative Agent or the Issuing Bank, sell participations to
one or more banks or other entities (a “Participant”) in all
or a portion of such Lender’s rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans owing to it); provided that (A)
such Lender’s obligations under this Agreement shall remain unchanged,
(B) such Lender shall remain solely responsible to the other parties hereto
for the performance of such obligations and (C) the Borrower, the
Administrative Agent, the Issuing Bank and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender’s
rights and obligations under this Agreement.  Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any provision of this
Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver
described in the proviso to Section 12.02 that affects such
Participant.  In addition such agreement must provide that the
Participant be bound by the provisions of Section 12.03.  Subject to
Section 12.04(c)(ii), the Borrower agrees that each Participant shall be
entitled to the benefits of Section 5.01, Section 5.02 and Section 5.03 to the
same extent as if it were a Lender and had acquired its interest by assignment
pursuant to Section 12.04(a).  To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 12.08 as though it
were a Lender; provided such
Participant agrees to be subject to Section 4.01(c) as though it were a
Lender.

     

    (ii)           A
Participant shall not be entitled to receive any greater payment under Section
5.01 or Section 5.03 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant, unless the
sale of the participation to such Participant is made with the Borrower’s prior
written consent.  A Participant that would be a Foreign Lender if it
were a Lender shall not be entitled to the benefits of Section 5.03 unless the
Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to comply with Section
5.03(d) as though it were a Lender.

     

    (d)           Any
Lender may at any time pledge or assign a security interest in all or any
portion of its rights under this Agreement to secure obligations of such Lender,
including, without limitation, any pledge or assignment to secure obligations to
a Federal Reserve Bank, and this Section 12.04(d) shall not apply to any such
pledge or assignment of a security interest; provided that no such
pledge or assignment of a security interest shall release a Lender from any of
its obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto.

     

    (e)           Notwithstanding
any other provisions of this Section 12.04, no transfer or assignment of the
interests or obligations of any Lender or any grant of participations therein
shall be permitted if such transfer, assignment or grant would require any
Credit Party to file a registration statement with the SEC or to qualify the
Loans under the “Blue Sky” laws of any state.

    
      
         

      

      
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    Section
12.05         Survival; Revival;
Reinstatement.

     

    (a)           All
covenants, agreements, representations and warranties made by the Borrower
herein and in the certificates or other instruments delivered in connection with
or pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the other parties hereto and shall survive the
execution and delivery of this Agreement and the making of any Loans and
issuance of any Letters of Credit, regardless of any investigation made by any
such other party or on its behalf and notwithstanding that the Administrative
Agent, any other Agent, the Issuing Bank or any Lender may have had notice or
knowledge of any Default or incorrect representation or warranty at the time any
credit is extended hereunder, and shall continue in full force and effect as
long as the principal of or any accrued interest on any Loan or any fee or any
other amount payable under this Agreement is outstanding and unpaid or any
Letter of Credit is outstanding and so long as the Commitments have not expired
or terminated.  The provisions of Section 5.01, Section 5.02, Section
5.03 and Section 12.03 and Article XI shall survive and remain in full force and
effect regardless of the consummation of the transactions contemplated hereby,
the repayment of the Loans, the expiration or termination of the Letters of
Credit and the Commitments or the termination of this Agreement, any other Loan
Document or any provision hereof or thereof.

     

    (b)           To
the extent that any payments on the Indebtedness or proceeds of any Collateral
are subsequently invalidated, declared to be fraudulent or preferential, set
aside or required to be repaid to a trustee, debtor in possession, receiver or
other Person under any bankruptcy law, common law or equitable cause, then to
such extent, the Indebtedness so satisfied shall be revived and continue as if
such payment or proceeds had not been received and the Administrative Agent’s
and the Lenders’ Liens, security interests, rights, powers and remedies under
this Agreement and each Loan Document shall continue in full force and
effect.  In such event, each Loan Document shall be automatically
reinstated and the Borrower shall take such action as may be reasonably
requested by the Administrative Agent and the Lenders to effect such
reinstatement.

     

    Section
12.06         Counterparts; Integration;
Effectiveness.

     

    (a)           This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract.

     

    (b)           This
Agreement, the other Loan Documents and any separate letter agreements with
respect to fees payable to the Administrative Agent constitute the entire
contract among the parties relating to the subject matter hereof and thereof and
supersede any and all previous agreements and understandings, oral or written,
relating to the subject matter hereof and thereof.  THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE
PARTIES HERETO AND THERETO AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE
ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

     

    (c)           Except
as provided in Section 6.01, this Agreement shall become effective when it shall
have been executed by the Administrative Agent and when the Administrative Agent
shall have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns.  Delivery of an executed counterpart of a
signature page of this Agreement by telecopy, facsimile or other similar
electronic means shall be effective as delivery of a manually executed
counterpart of this Agreement.

    
      
         

      

      
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    Section
12.07        Severability.  Any
provision of this Agreement or any other Loan Document held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of the remaining
provisions hereof or thereof; and the invalidity of a particular provision in a
particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

     

    Section
12.08        Right of
Setoff.  If an Event of Default shall have occurred and be
continuing, each Lender and each of its Affiliates is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other obligations (of whatsoever kind, including,
without limitations obligations under Swap Agreements) at any time owing by such
Lender or Affiliate to or for the credit or the account of any Credit Party
against any of and all the obligations of any Credit Party owed to such Lender
now or hereafter existing under this Agreement or any other Loan Document,
irrespective of whether or not such Lender shall have made any demand under this
Agreement or any other Loan Document and although such obligations may be
unmatured.  The rights of each Lender under this Section 12.08 are in
addition to other rights and remedies (including other rights of setoff) which
such Lender or its Affiliates may have.

     

    Section
12.09         Governing law;
Jurisdiction;
Consent to Service of Process.

     

    (a)           This
Agreement and the Notes shall be governed by, and construed in accordance with,
the laws of the State of New York except to the extent that United States
Federal law permits any Lender to contract for, charge, receive, reserve or take
interest at the rate allowed by the laws of the State where such Lender is
located.

     

    (b)           Any
legal action or proceeding with respect to the Loan Documents may be brought in
the courts of the State of New York or of the United States of America for the
Southern District of New York, and, by execution and delivery of this agreement,
each party hereby accepts for itself and (to the extent permitted by law) in
respect of its property, generally and unconditionally, the non-exclusive
jurisdiction of the aforesaid courts.  Each party hereby irrevocably
waives any objection, including, without limitation, any objection to the laying
of venue or based on the grounds of forum non conveniens, which
it may now or hereafter have to the bringing of any such action or proceeding in
such respective jurisdictions.  This submission to jurisdiction is
non-exclusive and does not preclude a party from obtaining jurisdiction over
another party in any court otherwise having jurisdiction.

     

    (c)           In
addition, to the extent that any Credit Party or Affiliate thereof may be
entitled, in any jurisdiction in which judicial proceedings may at any time be
commenced with respect to this agreement or any other Loan Document, to claim
for itself or its revenues, assets or properties any immunity from suit, the
jurisdiction of any court, attachment prior to judgment, attachment in aid of
execution of a judgment, set-off, execution of a judgment or any other legal
process, and to the extent that in any such jurisdiction there may be attributed
such immunity (whether or not claimed), such Person irrevocably agrees not to
claim and hereby irrevocably waives such immunity to the fullest extent
permitted by the laws of such jurisdiction and hereby agrees that the foregoing
waiver shall be enforced to the fullest extent permitted under the Foreign
Sovereign Immunities Act of 1976 of the United States of America, as amended,
and is intended to be irrevocable for the purpose of such Act.

    
      
         

      

      
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    (d)           The
Parent and the Borrower each hereby irrevocably designates, appoints and
empowers and hereby confers an irrevocable special power, ample and sufficient,
to CT Corporation System, with offices on the date hereof at 111 Eighth Avenue,
New York, New York 10011 as its designee, appointee and agent with respect to
any such action or proceeding in New York to receive, accept and acknowledge for
and on its behalf, and in respect of its Property, service of any and all legal
process, summons, notices and documents which may be served in any such
proceeding and agrees that the failure of such agent to give any advice of any
such service of process to the Parent or the Borrower shall not impair or affect
the validity of such service or of any claim based thereon.  If for
any reason such designee, appointee and agent shall cease to be available to act
as such, the Parent and the Borrower each agrees to designate a new designee,
appointee and agent in New York City reasonably satisfactory to the
Administrative Agent on the terms and for the purposes of this
provision.  Each party irrevocably consents to the service of process
of any of the aforementioned courts in any such action or proceeding by the
mailing of copies thereof by registered or certified mail, postage prepaid, to
it at the address specified in Section 12.01 or such other address as is
specified pursuant to Section 12.01 (or its assignment and assumption), such
service to become effective thirty (30) days after such
mailing.  Nothing herein shall affect the right of a party or any
holder of a Note to serve process in any other manner permitted by law or to
commence legal proceedings or otherwise proceed against another party in any
other jurisdiction.

     

    (e)           Each
party hereby (i) irrevocably and unconditionally waives, to the fullest extent
permitted by law, trial by jury in any legal action or proceeding relating to
this Agreement or any other Loan Document and for any counterclaim therein; (ii)
irrevocably waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any such litigation any special, exemplary,
punitive or consequential damages, or damages other than, or in addition to,
actual damages; (iii) certifies that no party hereto nor any representative or
agent of counsel for any party hereto has represented, expressly or otherwise,
or implied that such party would not, in the event of litigation, seek to
enforce the foregoing waivers; and (iv) acknowledges that it has been induced to
enter into this Agreement, the Loan Documents and the transactions contemplated
hereby and thereby by, among other things, the mutual waivers and certifications
contained in this Section 12.01.

     

    Section
12.10        Headings.  Article
and Section headings and the Table of Contents used herein are for convenience
of reference only, are not part of this Agreement and shall not affect the
construction of, or be taken into consideration in interpreting, this
Agreement.

     

    Section
12.11        Confidentiality.  Each
of the Administrative Agent, the Issuing Bank and the Lenders agrees to maintain
the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its and its Affiliates’ directors, officers,
employees and agents, including accountants, legal counsel and other advisors
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential), (b) to the extent requested by any regulatory
authority, (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process, (d) to any other party to this Agreement
or any other Loan Document, (e) in connection with the exercise of any remedies
hereunder or under any other Loan Document or any suit, action or proceeding
relating to this Agreement or any other Loan Document or the enforcement of
rights hereunder or thereunder, (f) subject to an agreement containing
provisions substantially the same as those of this Section 12.11, to (i) any
assignee of or Participant in, or any prospective assignee of or Participant in,
any of its rights or obligations under this Agreement or (ii) any actual or
prospective counterparty (or its advisors) to any Swap Agreement relating to the
Borrower and its obligations, (g) with the consent of the Borrower or (h) to the
extent such Information (i) becomes publicly available other than as a result of
a breach of this Section 12.11 or (ii) becomes available to the Administrative
Agent, the Issuing Bank or any Lender on a nonconfidential basis from a source
other than the Borrower.  For the purposes of this Section 12.11,
“Information”
means all information received from any Credit Party relating to the Credit
Parties and their businesses, other than any such information that is available
to the Administrative Agent, the Issuing Bank or any Lender on a nonconfidential
basis prior to disclosure by a Credit Party; provided that, in the
case of information received from any Credit Party after the date hereof, such
information is clearly identified at the time of delivery as
confidential.  Any Person required to maintain the confidentiality of
Information as provided in this Section 12.11 shall be considered to have
complied with its obligation to do so if such Person has exercised the same
degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.

    
      
         

      

      
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    Section
12.12        Interest Rate
Limitation.  It is the intention of the parties hereto that
each Lender shall conform strictly to usury laws applicable to
it.  Accordingly, if the transactions contemplated hereby would be
usurious as to any Lender under laws applicable to it (including the laws of the
United States of America or any other jurisdiction whose laws may be mandatorily
applicable to such Lender notwithstanding the other provisions of this
Agreement), then, in that event, notwithstanding anything to the contrary in any
of the Loan Documents or any agreement entered into in connection with or as
security for the Notes, it is agreed as follows:  (i) the aggregate of
all consideration which constitutes interest under law applicable to any Lender
that is contracted for, taken, reserved, charged or received by such Lender
under any of the Loan Documents or agreements or otherwise in connection with
the Notes shall under no circumstances exceed the maximum amount allowed by such
applicable law, and any excess shall be canceled automatically and if
theretofore paid shall be credited by such Lender on the principal amount of the
Indebtedness (or, to the extent that the principal amount of the Indebtedness
shall have been or would thereby be paid in full, refunded by such Lender to the
Borrower); and (ii) in the event that the maturity of the Notes is accelerated
by reason of an election of the holder thereof resulting from any Event of
Default under this Agreement or otherwise, or in the event of any required or
permitted prepayment, then such consideration that constitutes interest under
law applicable to any Lender may never include more than the maximum amount
allowed by such applicable law, and excess interest, if any, provided for in
this Agreement or otherwise shall be canceled automatically by such Lender as of
the date of such acceleration or prepayment and, if theretofore paid, shall be
credited by such Lender on the principal amount of the Indebtedness (or, to the
extent that the principal amount of the Indebtedness shall have been or would
thereby be paid in full, refunded by such Lender to the
Borrower).  All sums paid or agreed to be paid to any Lender for the
use, forbearance or detention of sums due hereunder shall, to the extent
permitted by law applicable to such Lender, be amortized, prorated, allocated
and spread throughout the stated term of the Loans evidenced by the Notes until
payment in full so that the rate or amount of interest on account of any Loans
hereunder does not exceed the maximum amount allowed by such applicable
law.  If at any time and from time to time (i) the amount of interest
payable to any Lender on any date shall be computed at the Highest Lawful Rate
applicable to such Lender pursuant to this Section 12.12 and (ii) in respect of
any subsequent interest computation period the amount of interest otherwise
payable to such Lender would be less than the amount of interest payable to such
Lender computed at the Highest Lawful Rate applicable to such Lender, then the
amount of interest payable to such Lender in respect of such subsequent interest
computation period shall continue to be computed at the Highest Lawful Rate
applicable to such Lender until the total amount of interest payable to such
Lender shall equal the total amount of interest which would have been payable to
such Lender if the total amount of interest had been computed without giving
effect to this Section 12.12.

    
      
         

      

      
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    Section
12.13        Judgment
Currency.  This is an international loan transaction in which
the specification of US Dollars is of the essence, and the stipulated currency
shall in each instance be the currency of account and payment in all
instances.  A payment obligation in one currency hereunder (the “Original Currency”)
shall not be discharged by an amount paid in another currency (the “Other Currency”),
whether pursuant to any judgment expressed in or converted into any Other
Currency or in another place except to the extent that such tender or recovery
results in the effective receipt by the payee of the full amount of the Original
Currency payable by it under this Agreement.  If for the purpose of
obtaining judgment in any court it is necessary to convert a sum due hereunder
in the Original Currency into the Other Currency, the rate of exchange that
shall be applied shall be that at which in accordance with normal banking
procedures the Administrative Agent or any Lender hereunder could purchase
Original Currency with the Other Currency on the Business Day next preceding the
day on which such judgment is rendered.  The obligation of each Credit
Party in respect of any such sum due from it to the Administrative Agent or any
other Person under any Loan Document (in this Section called an “Entitled Person”)
shall, notwithstanding the rate of exchange actually applied in rendering such
judgment, be discharged only to the extent that on the Business Day following
receipt by such Entitled Person of any sum adjudged to be due hereunder in the
Other Currency such Entitled Person may in accordance with normal banking
procedures purchase and transfer the Original Currency to New York with the
amount of the judgment currency so adjudged to be due; and each Credit Party
hereby, as a separate obligation and notwithstanding any such judgment, agrees
jointly and severally to indemnify such Entitled Person against, and to pay such
Entitled Person on demand, in the Original Currency, the amount (if any) by
which the sum originally due to such Entitled Person in the Original Currency
hereunder exceeds the amount of the Original Currency so purchased and
transferred.

     

    Section
12.14        EXCULPATION
PROVISIONS.  EACH OF THE PARTIES HERETO SPECIFICALLY AGREES
THAT IT HAS A DUTY TO READ THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS AND
AGREES THAT IT IS CHARGED WITH NOTICE AND KNOWLEDGE OF THE TERMS OF THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS; THAT IT HAS IN FACT READ THIS AGREEMENT
AND IS FULLY INFORMED AND HAS FULL NOTICE AND KNOWLEDGE OF THE TERMS, CONDITIONS
AND EFFECTS OF THIS AGREEMENT; THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL
COUNSEL OF ITS CHOICE THROUGHOUT THE NEGOTIATIONS PRECEDING ITS EXECUTION OF
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS; AND HAS RECEIVED THE ADVICE OF ITS
ATTORNEY IN ENTERING INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS; AND THAT
IT RECOGNIZES THAT CERTAIN OF THE TERMS OF THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS RESULT IN ONE PARTY ASSUMING THE LIABILITY INHERENT IN SOME ASPECTS OF
THE TRANSACTION AND RELIEVING THE OTHER PARTY OF ITS RESPONSIBILITY FOR SUCH
LIABILITY.  EACH PARTY HERETO AGREES AND COVENANTS THAT IT WILL NOT
CONTEST THE VALIDITY OR ENFORCEABILITY OF ANY EXCULPATORY PROVISION OF THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS ON THE BASIS THAT THE PARTY HAD NO NOTICE
OR KNOWLEDGE OF SUCH PROVISION OR THAT THE PROVISION IS NOT
“CONSPICUOUS.”

     

    Section
12.15        Collateral Matters; Secured
Swap Agreements.  The benefit of the Security Instruments and
of the provisions of this Agreement relating to any Collateral securing the
Indebtedness shall also extend to and be available to Secured Swap Parties on a
pro rata basis (but
subject to the terms of the Loan Documents, including, without limitation,
provisions thereof relating to the application and priority of payments to the
Secured Parties) in respect of any obligations of the Parent or any Subsidiary
which arise under Secured Swap Agreements, including any Secured Swap Agreements
entered into prior to the date hereof.  No Secured Swap Party shall
have any voting rights under any Loan Document as a result of the existence of
obligations owed to it under any Secured Swap Agreement.

     

    Section
12.16        Collateral Assignment of
Swap Agreements.

     

    (a)           Pursuant
to the Security Instruments, each Credit Party is required to pledge, assign and
transfer (the “Swap
Assignment”) to the Administrative Agent, for the benefit of the Secured
Parties, as collateral security for the prompt and complete payment and
performance when due of the Obligations (as defined therein), a first priority
continuing security interest in, lien on and right of setoff against, all of its
right, title and interest in and to each Swap Agreement to which it is a party,
including each Swap Agreement between such Credit Party and any Lender or
Affiliate of a Lender, all as more particularly described in the Security
Instruments (the “Swap
Collateral”).  In furtherance of the foregoing, each Lender
hereby: (i) consents and agrees to the Swap Assignment and (ii) agrees that from
and after the Effective Date it will make any payments which become payable by
such Lender under or pursuant to any Swap Agreement between such Lender and any
Credit Party directly to the relevant Collection Account until such time as the
grant of security interest in such Collateral is released pursuant to the terms
of this Agreement and the other Loan Documents.

    
      
         

      

      
        85

        
          

        

      

      
         

      

    

    (b)           The
Parent and the Borrower each agrees that any payment made by a Lender or an
Affiliate of a Lender pursuant to the provisions of this Section 12.16 shall, to
the extent of such payment, satisfy the obligations of such Lender or its
Affiliate under the relevant Swap Agreement.  The Parent and the
Borrower each agrees to hold each Lender and its Affiliates harmless from any
claims or liabilities resulting from actions of such Lender or its Affiliates in
accordance with the terms of this Section 12.16.

     

    Section
12.17        No Third Party
Beneficiaries.  This Agreement, the other Loan Documents, and
the agreement of the Lenders to make Loans and the Issuing Bank to issue, amend,
renew or extend Letters of Credit hereunder are solely for the benefit of the
Borrower, and no other Person (including, without limitation, any Subsidiary of
the Borrower, any obligor, contractor, subcontractor, supplier or materialsman)
shall have any rights, claims, remedies or privileges hereunder or under any
other Loan Document against the Administrative Agent, any other Agent, the
Issuing Bank or any Lender for any reason whatsoever.  There are no
third party beneficiaries.

     

    Section
12.18         USA Patriot Act
Notice.

     

    (a)           Each
Lender and the Administrative Agent (for itself and not on behalf of any Lender)
hereby notifies each Credit Party that pursuant to the requirements of the USA
Patriot Act, it is required to obtain, verify and record information that
identifies each of them, which information includes the name and address of each
Credit Party and other information that will allow such Lender or the
Administrative Agent, as applicable, to identify such Person in accordance with
the USA Patriot Act.  The Parent shall, and shall cause each of its
Subsidiaries to, provide, to the extent commercially reasonable, such
information and take such actions as are reasonably requested by each Lender and
the Administrative Agent to maintain compliance with the Act.

     

    (b)           In
the event that: (i) the introduction of or any change in (or in the
interpretation, administration or application of) any law or regulation made
after the date of this Agreement, (ii) any change in the status of any Credit
Party after the date of this Agreement, or (iii) a proposed assignment or
transfer by a Lender of any of its rights and obligations under this Agreement
to a party that is not a Lender prior to such assignment or transfer, requires
the Administrative Agent (for itself or on behalf of a Lender) or a Lender to
comply with “know your customer” or similar identification procedures in
circumstances where the necessary information is not already available to it,
any or all of the Credit Parties, as applicable, shall promptly, upon the
request of the Administrative Agent, supply, or produce the supply of such
documentation and other evidence as is requested by the Administrative Agent
(for itself or on behalf of any of the Lenders) in order for the Administrative
Agent or the Lenders, as the case may be, to carry out and be satisfied it has
complied with all necessary “know your customer” or other similar checks under
all applicable laws.

     

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

    
      
         

      

      
        86

        
          

        

      

      
         

      

    

    Section
12.19       English
Language.  This Agreement has been negotiated and executed in
the English language.  All certificates, reports, notices and other
documents and communications given or delivered pursuant to this Agreement shall
be in the English language or, if not in English and if requested by the
Administrative Agent, accompanied by a certified English translation
thereof.  The English language version of any such document for
purposes of this Agreement shall control the meaning of the matters set forth
herein.

     

    [SIGNATURES
BEGIN NEXT PAGE]

     

    
      
         

      

      
        87

        
          

        

      

      
         

      

    

    The
parties hereto have caused this Agreement to be duly executed as of the day and
year first above written.

     

    
      
        	
                BORROWER:

              	
                SOLANA
      RESOURCES LIMITED

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Martin Eden

              
	 
      	
                Name:  Martin
      Eden

              
	 
      	
                Title:  Director

              

      

    

    

    Signature
Page – Credit Agreement

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        	
                PARENT:

              	
                GRAN
      TIERRA ENERGY INC.

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Martin Eden

              
	 
      	
                Name:  Martin
      Eden

              
	 
      	
                Title:  Chief
      Financial Officer

              

      

    

    

    Signature
Page – Credit Agreement

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        	
                ADMINISTRATIVE
      AGENT:

              	
                BNP
      PARIBAS,

              
	 
      	
                as
      Administrative Agent and a Lender

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Brian Malone

              
	 
      	
                Name:
      Brian Malone

              
	 
      	
                Title:
      Managing Director

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Juan Carlos Sandoval

              
	 
      	
                Name:
      Juan Carlos Sandoval

              
	 
      	
                Title:
      Vice President

              

      

    

    

    Signature
Page – Credit Agreement

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Annex
I

    List of Maximum Credit
Amounts

    

    
      
        
          
            
              
                
                  	
                          Lender

                        	 	
                          Applicable Percentage

                        	 	 	
                          Maximum Credit Amounts

                        	 
	
                          BNP
      Paribas

                        	 	 	100.00	%	 	$	100,000,000.00	 
	
                          TOTAL

                        	 	 	100.00	%	 	$	100,000,000.00	 

                

              

            

          

        

      

    

     

    Annex I - Page
1

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Exhibit
A

    Form of
Note

    

    
      
        	
                $[          ]

              	
                [          ],
      20[     ]

              

      

    

    

    FOR VALUE
RECEIVED, SOLANA
RESOURCES LIMITED, a corporation duly formed and existing under the laws
of the Province of
Alberta, Canada (the “Borrower”), hereby
promises to pay to the order of
[          ] (the “Lender”), at the
principal office of BNP PARIBAS (the “Administrative
Agent”), at 1200 Smith Street, Suite 3100, Houston, Texas 77002, United
States of America, the principal sum of
[          ] Dollars
($[          ]) (or such
lesser amount as shall equal the aggregate unpaid principal amount of the Loans
made by the Lender to the Borrower under the Credit Agreement, as hereinafter
defined), in lawful money of the United States of America and in immediately
available funds, on the dates and in the principal amounts provided in the
Credit Agreement, and to pay interest on the unpaid principal amount of each
such Loan, at such office, in like money and funds, for the period commencing on
the date of such Loan until such Loan shall be paid in full, at the rates per
annum and on the dates provided in the Credit Agreement.

     

    The date,
amount, Type, interest rate, Interest Period and maturity of each Loan made by
the Lender to the Borrower, and each payment made on account of the principal
thereof, shall be recorded by the Lender on its books and, prior to any transfer
of this Note, may be endorsed by the Lender on the schedules attached hereto or
any continuation thereof or on any separate record maintained by the
Lender.  Failure to make any such notation or to attach a schedule
shall not affect any Lender’s or the Borrower’s rights or obligations in respect
of such Loans or affect the validity of such transfer by any Lender of this
Note.

     

    This Note
is one of the Notes referred to in the Credit Agreement dated as of July 30,
2010 among the Borrower, the Parent, the Administrative Agent, and the other
agents and lenders signatory thereto (including the Lender), and evidences Loans
made by the Lender thereunder (such Credit Agreement as the same may be amended,
supplemented, restated or otherwise modified from time to time, the “Credit
Agreement”).  Capitalized terms used in this Note have the
respective meanings assigned to them in the Credit Agreement.

     

    This Note
is issued pursuant to, and is subject to the terms and conditions set forth in,
the Credit Agreement and is entitled to the benefits provided for in the Credit
Agreement and the other Loan Documents.  The Credit Agreement provides
for the acceleration of the maturity of this Note upon the occurrence of certain
events, for prepayments of Loans upon the terms and conditions specified therein
and other provisions relevant to this Note.

     

    THIS NOTE
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK, EXCEPT TO THE EXTENT THAT UNITED STATES FEDERAL LAW PERMITS ANY LENDER
TO CONTRACT FOR, CHARGE, RECEIVE, RESERVE OR TAKE INTEREST AT THE RATE ALLOWED
BY THE LAWS OF THE STATE WHERE SUCH LENDER IS LOCATED.

     

    
      
        
          
            
              
                	
                        SOLANA
      RESOURCES LIMITED

                      
	 
      	 
      
	
                        By:

                      	 
        
	
                        Name:

                      	  
       
	
                        Title:

                      	 
        

              

            

          

        

      

    

    

    Exhibit
A

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Exhibit
B

    Form of Borrowing
Request

     

    [                   ],
20[   ]

     

    Solana Resources
Limited, a corporation duly formed and existing under the laws of the Province of Alberta,
Canada (the “Borrower”), pursuant
to Section 2.03 of the Credit Agreement dated as of July 30, 2010 (together with
all amendments, restatements, supplements or other modifications thereto, the
“Credit
Agreement”) among the Borrower, the Parent, BNP Paribas, as
Administrative Agent and the other agents and lenders (the “Lenders”) which are
or become parties thereto (unless otherwise defined herein, each capitalized
term used herein is defined in the Credit Agreement), hereby requests a
Borrowing as follows:

     

    (i)           Aggregate
amount of the requested Borrowing is
$[                   ];

     

    (ii)          Date
of such Borrowing is
[                   ],
20[   ];

     

    (iii)    
    Requested Borrowing is to be [an ABR Borrowing] [a
Eurodollar Borrowing];

     

    [(iv)       The
initial Interest Period applicable thereto is three months;] [Applicable only to Eurodollar
Borrowings]

     

    (v)         Amount
of Borrowing Base in effect on the date hereof is
$[                   ];

     

    (vi)        Total
Revolving Credit Exposures on the date hereof (i.e., outstanding principal
amount of Loans and total LC Exposure) are
$[                   ];

     

    (vii)       Pro forma total Revolving
Credit Exposures (giving effect to the requested Borrowing) are
$[                   ];
and

     

    (viii)      Location
and number of the Borrower’s account to which funds are to be disbursed, which
shall comply with the requirements of Section 2.05 of the Credit Agreement, is
as follows:

     

     
[           
                                ]

      [           
                                ]

      [           
                                ]

      [           
                                ]

      [           
                                ]

    

    Exhibit B
– Page 1

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    The
undersigned certifies that he/she is the
[                ]
of the Borrower, and that as such he/she is authorized to execute this
certificate on behalf of the Borrower.  The undersigned further
certifies, represents and warrants on behalf of the Borrower that the Borrower
is entitled to receive the requested Borrowing under the terms and conditions of
the Credit Agreement.

     

    
      
        
          
            
              
                
                  
                    
                      
                        	
                                SOLANA
      RESOURCES LIMITED

                              	 
	 
      	 
	
                                By:

                              	 
        	  
      
	
                                Name:

                              	 
        	 
	
                                Title:

                              	 
        	  
      

                      

                    

                  

                

              

            

          

        

      

    

     

    Exhibit B
– Page 2

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Exhibit
C

    Form of Interest Election
Request

    

    [                ],
20[   ]

     

    Solana Resources
Limited, a corporation duly formed and existing under the laws of the Province of Alberta,
Canada (the “Borrower”), pursuant
to Section 2.04 of the Credit Agreement dated as of July 30, 2010 (together with
all amendments, restatements, supplements or other modifications thereto, the
“Credit
Agreement”) among the Borrower, the Parent, BNP Paribas, as
Administrative Agent and the other agents and lenders (the “Lenders”) which are
or become parties thereto (unless otherwise defined herein, each capitalized
term used herein is defined in the Credit Agreement), hereby makes an Interest
Election Request as follows:

     

    (i)           The
Borrowing to which this Interest Election Request applies and, if different
options are being elected with respect to different portions thereof, the
portions thereof to be allocated to each resulting Borrowing (in which case the
information specified pursuant to (ii) and (iii) below shall be specified for
each resulting Borrowing) is
[                ];

     

    (ii)           The
effective date of the election made pursuant to this Interest Election Request
is
[                ],
20[   ];[and]

     

    (iii)           The
resulting Borrowing is to be [an ABR Borrowing] [a Eurodollar Borrowing][;
and]

     

    [(iv)           The
Interest Period applicable to the resulting Borrowing after giving effect to
such election is three months]. [Applicable only to Eurodollar
Borrowings]

     

    The
undersigned certifies that he/she is the
[                ]
of the Borrower, and that as such he/she is authorized to execute this
certificate on behalf of the Borrower.  The undersigned further
certifies, represents and warrants on behalf of the Borrower that the Borrower
is entitled to receive the requested continuation or conversion under the terms
and conditions of the Credit Agreement.

     

    
      
        
          
            
              
                
                  
                    
                      	
                              SOLANA
      RESOURCES LIMITED

                            	 
	 
      	 
	
                              By:

                            	 
        	 
       
	
                              Name:

                            	 
        	 
	
                              Title:

                            	 
        	 
       

                    

                  

                

              

            

          

        

      

    

     

    Exhibit C
– Page 1

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Exhibit
D

    Form of Compliance
Certificate

    

    The
undersigned hereby certifies that he/she is the
[          ] of Solana Resources
Limited, a corporation duly formed and existing under the laws of the Province of Alberta,
Canada (the “Borrower”), and that
as such he/she is authorized to execute this certificate on behalf of the
Borrower.  With reference to the Credit Agreement dated as of July 30,
2010 (together with all amendments, restatements, supplements or other
modifications thereto being the “Agreement”) among the
Borrower, the Parent, BNP Paribas, as Administrative Agent, and the other agents
and lenders (the “Lenders”) which are
or become a party thereto, the undersigned represents and warrants as follows
(each capitalized term used herein having the same meaning given to it in the
Agreement unless otherwise specified):

     

    (a)           The
representations and warranties of the Credit Parties contained in Article VII of
the Agreement and in the Loan Documents and otherwise made in writing by or on
behalf of the Borrower pursuant to the Agreement and the Loan Documents were
true and correct in all material respects when made, and are repeated at and as
of the time of delivery hereof and are true and correct in all material respects
at and as of the time of delivery hereof, except to the extent such
representations and warranties are expressly limited to an earlier
date.

     

    (b)           There
exists no Default or Event of Default [or specify Default and
describe].

     

    (c)           Attached
hereto are the detailed computations necessary to determine whether the Parent
is in compliance with Section 9.01 as of the end of the [fiscal quarter][fiscal
year] ending
[          ].

     

    EXECUTED
AND DELIVERED this
[          ] day of
[          ].

     

    
      
        
          
            
              
                
                  
                    
                      	
                              SOLANA
      RESOURCES LIMITED

                            	 
	 
      	 
	
                              By:

                            	 
        	 
       
	
                              Name:

                            	 
        	 
	
                              Title:

                            	 
        	 
       

                    

                  

                

              

            

          

        

      

    

     

    Exhibit D
– Page 2

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Exhibit
E

    Security
Instruments

    

    
      	
              1)

            	
              Guaranty
      and Collateral Agreement made by each of the Obligors (as defined
      therein), in favor of the Administrative
Agent

            

    

     

    
      	
              2)

            	
              UCC-1
      Financing Statements in respect of item 1,
by

            

    

     

    
      	
               
      

            	
              a)

            	
              Gran
      Tierra Energy Inc. (filed with the Secretary of State of
      Nevada)

            

    

    
      	
               
      

            	
              b)

            	
              Gran
      Tierra Energy International Holdings Ltd. (filed with the Recorded of
      Deeds of the District of Colombia)

            

    

    
      	
               
      

            	
              c)

            	
              Solana
      Petroleum Exploration (Colombia) Limited (filed with the Recorded of Deeds
      of the District of Colombia)

            

    

    
      	
               
      

            	
              d)

            	
              Gran
      Tierra Energy Cayman Islands Inc. (filed with the Recorded of Deeds of the
      District of Colombia)

            

    

    
      	
               
      

            	
              e)

            	
              Argosy
      Energy LLC (filed with the Secretary of State of
  Delaware)

            

    

    
      	 	
              f)

            	
              Gran
      Tierra Energy Colombia, Ltd. (filed with the Secretary of State of
      Utah)

            

    

     

    
      	
              3)

            	
              Registration
      of Financing Statements at the Personal Property Registry of Alberta (and
      each other applicable jurisdiction) in respect of item 1, by Macleod Dixon
      LLP

            

    

     

    
      	
              4)

            	
              Stock
      Powers delivered in respect of any certificated U.S. entities whose equity
      interests are required to be pledged under the Loan
    Documents

            

    

     

    
      	
              5)

            	
              Contratos
      de Prenda Abierta y Sin Tenencia Sobre Los Derechos Económicos Derivados
      de Los Contratos de Concesión in favor of the Administrative Agent and the
      Lenders (filed with the applicable Chamber of Commerce),
  by

            

    

     

    
      	
            	
              a)

            	
              Solana
      Petroleum Exploration (Colombia)
Limited

            

    

    
      	 	
              b)

            	
              Gran
      Tierra Energy Colombia Ltd.

            

    

    

    
      	
              6)

            	
              Letters
      of Instruction / Consent and Agreements
by

            

    

     

    
      	
               
      

            	
              a)

            	
              Ecopetrol
      S.A – Commercial offer to purchase crude from Santana and Guayuyaco, from
      Gran Tierra Energy Colombia Ltd., dated December 18,
  2009.

            

    

    
      	
               
      

            	
              b)

            	
              Ecopetrol
      S.A.—Commercial offer to purchase crude from Chaza, from Gran Tierra
      Energy Colombia Ltd. dated December 18,
2009.

            

    

    
      	
               
      

            	
              c)

            	
              Ecopetrol
      S.A.—Commercial offer to purchase crude from Guayuyaco, from Solana
      Petroleum Exploration (Colombia) Limited dated December 18,
      2009.

            

    

    
      	
               
      

            	
              d)

            	
              Ecopetrol
      S.A.—Commercial offer to purchase crude from Chaza, between Solana
      Petroleum Exploration (Colombia) Limited dated December 18,
      2009.

            

    

    

    
      	
              7)

            	
              Equitable
      Charge over Shares in Gran Tierra Energy International Holdings Ltd. by
      Solana Resources Limited, in favor of the Administrative Agent and the
      Secured Parties (both as defined in the Guaranty and Collateral
      Agreement).

            

    

     

    
      	
              8)

            	
              Notation
      on Register of Members of Gran Tierra Energy International Holdings Ltd.
      indicating charge on shares and providing details (with respect to item
      7).

            

    

     

    Exhibit E
– Page 1

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
      	
              9)

            	
              Equitable
      Charge over Shares in Solana Petroleum Exploration (Colombia) Limited by
      Gran Tierra Energy International Holdings Ltd. in favor of the
      Administrative Agent and the Secured Parties (both as defined in the
      Guaranty and Collateral Agreement).

            

    

     

    
      	
              10)

            	
              (i)
      Notation on Register of Members of Solana Petroleum Exploration (Colombia)
      Limited indicating charge on shares and providing details; and (ii) Entry
      on Register of Mortgages and Charges of Gran Tierra Energy International
      Holdings Ltd. (both with respect to item
9).

            

    

     

    
      	
              11)

            	
              Equitable
      Charge over Shares in Gran Tierra Energy Cayman Islands Inc. by Gran
      Tierra International Holdings Ltd. in favor of the Administrative Agent
      and the Secured Parties (both as defined in the Guaranty and Collateral
      Agreement).

            

    

     

    
      	
              12)

            	
              (i)
      Notation on Register of Members of Gran Tierra Energy Cayman Islands Inc.
      indicating charge on shares and providing details; and (ii) Entry on
      Register of Mortgages and Charges of Gran Tierra Energy International
      Holdings Ltd. (both with respect to item
11).

            

    

     

    
      	
              13)

            	
              Deposit
      Account Control Agreement (Gran Tierra Energy Colombia) and Deposit
      Account Control Agreement (Solana Petroleum Exploration) (as such terms
      defined in the Credit Agreement)

            

    

     

    
      	
              14)

            	
              Canadian
      Securities Pledge Agreement from Gran Tierra Callco ULC respecting the
      shares of Gran Tierra Exchangeco Inc., and from Gran Tierra Exchangeco
      Inc. respecting the shares of Solana Resources
  Limited.

            

    

     

    
      	
              15)

            	
              Stock
      powers of attorney or other transfer documents with respect to item
      14

            

    

     

    
      	
              16)

            	
              Canadian
      Security Agreement from Gran Tierra Energy Inc., Gran Tierra Exchangeco
      Inc. and Solana Resources Limited

            

    

     

    
      	
              17)

            	
              Registration
      of Financing Statements at the Personal Property Registry of Alberta (and
      each other applicable jurisdiction) in respect of item 16, by Macleod
      Dixon LLP

            

    

     

    Exhibit E
– Page 2

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Exhibit
F

    Form of Assignment and
Assumption

    

    This Assignment and Assumption (the
“Assignment and
Assumption”) is dated as of the Effective Date set forth below and is
entered into by and between [Insert name of Assignor] (the
“Assignor”) and
[Insert name of
Assignee] (the “Assignee”).  Capitalized
terms used but not defined herein shall have the meanings given to them in the
Credit Agreement identified below (as amended, supplemented, restated or
otherwise modified from time to time, the “Credit Agreement”),
receipt of a copy of which is hereby acknowledged by the
Assignee.  The Standard Terms and Conditions set forth in Annex 1
attached hereto are hereby agreed to and incorporated herein by reference and
made a part of this Assignment and Assumption as if set forth herein in
full.

    

    For an agreed consideration, the
Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee
hereby irrevocably purchases and assumes from the Assignor, subject to and in
accordance with the Standard Terms and Conditions and the Credit Agreement, as
of the Effective Date inserted by the Administrative Agent as contemplated below
(i) all of the Assignor’s rights and obligations in its capacity as a Lender
under the Credit Agreement and any other documents or instruments delivered
pursuant thereto to the extent related to the amount and percentage interest
identified below of all of such outstanding rights and obligations of the
Assignor under the respective facilities identified below (including any letters
of credit and guarantees included in such facilities) and (ii) to the extent
permitted to be assigned under applicable law, all claims, suits, causes of
action and any other right of the Assignor (in its capacity as a Lender) against
any Person, whether known or unknown, arising under or in connection with the
Credit Agreement, any other documents or instruments delivered pursuant thereto
or the loan transactions governed thereby or in any way based on or related to
any of the foregoing, including contract claims, tort claims, malpractice
claims, statutory claims and all other claims at law or in equity related to the
rights and obligations sold and assigned pursuant to clause (i) above (the
rights and obligations sold and assigned pursuant to clauses (i) and (ii) above
being referred to herein collectively as the “Assigned
Interest”).  Such sale and assignment is without recourse to
the Assignor and, except as expressly provided in this Assignment and
Assumption, without representation or warranty by the Assignor.

    

    
      
        	
                1.

              	
                Assignor:

              	
                ______________________________

              

      

    

    

    
      
        	
                2.

              	
                Assignee:

              	
                ______________________________

              
	 	 	 [and
      is an Affiliate/Approved Fund of [identify
      Lender]1]

      

    

    
       

    

    
      
        	
                3.

              	
                Borrower:

              	
                Solana
      Resources Limited

              

      

    

    

    
      
        	
                4.

              	
                Administrative
      Agent:

              	
                BNP
      Paribas

              

      

    

     

    
      
        

      

    

    
      1 Select
as applicable.

    

     

    Exhibit F – Page 1

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        	
                5.

              	
                Credit
      Agreement:

              	
                The
      Credit Agreement dated as of June 30, 2010 among Solana Resources Limited,
      as Borrower, the Parent, BNP Paribas, as Administrative Agent and the
      Lenders parties thereto

              

      

    

    

    
      
        	
                6.

              	
                Assigned
      Interest:

              

      

    

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          	
                                  Commitment

                                  Assigned

                                	 	
                                  Aggregate Amount of

                                  Commitment/Loans

                                  for all Lenders

                                	 	 	
                                  Amount of

                                  Commitment/Loans

                                  Assigned

                                	 	 	
                                  Percentage Assigned

                                  of

                                  Commitment/Loans2

                                	 
	 
      	 	$	 	 	 	$	 	 	 	 	 	%
	 
      	 	$	 	 	 	$	 	 	 	 	 	%
	 
      	 	$	 	 	 	$	 	 	 	 	 	%

                        

                      

                    

                  

                

              

            

          

        

      

    

    

    Effective
Date:   _____________ ___, 20___ [TO BE INSERTED BY
ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF
TRANSFER IN THE REGISTER THEREFOR.]

    

    The terms
set forth in this Assignment and Assumption are hereby agreed to:

    

    
      
        
          
            
              
                
                  	
                          ASSIGNOR

                        
	 
      
	
                          [NAME
      OF ASSIGNOR]

                        
	 
      
	
                          By:

                        	 
        
	
                          Name:

                        	 
        
	
                          Title:

                        	 
       

                

              

            

          

        

      

    

    

    
      
        
          
            
              
                
                  	
                          ASSIGNEE

                        
	 
      
	
                          [NAME
      OF ASSIGNEE]

                        
	 
      
	
                          By:

                        	 
        
	
                          Name:

                        	 
        
	
                          Title:

                        	 
       

                

              

            

          

        

      

    

     

    
      

    
      2 Set
forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all
Lenders thereunder.

    

     

    Exhibit F – Page 2

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    [Consented
to and]3
Accepted:

    

    BNP
Paribas, as

      Administrative
Agent

    

    
      
        
          
            
              	
                      By:

                    	 
        
	
                      Name:

                    	 
        
	
                      Title:

                    	 
        

            

          

        

      

    

    

    
      
        
          
            
              	
                      By:

                    	 
        
	
                      Name:

                    	 
        
	
                      Title:

                    	 
        

            

          

        

      

    

    

    [Consented
to:]4

    

    [NAME OF
RELEVANT PARTY]

    

    
      
        
          
            
              	
                      By:

                    	 
        
	
                      Name:

                    	 
      
	
                      Title:

                    	 
        

            

          

        

      

    

    

    
      

    

    
      3 To be
added only if the consent of the Administrative Agent is required by the terms
of the Credit Agreement.  

    

    
      4 To be
added only if the consent of the Borrower and/or other parties (e.g. Issuing
Bank) is required by the terms of the Credit Agreement.

       

      Exhibit F – Page 3

        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

    

    

    Schedule
1.02(a)

    Colombian Hydrocarbon
Properties/Concession Agreements

    

    
      
        
          
            	
                    BLOCK

                  	 
      	
                    DESCRIPTION

                  	 
      	
                    EFFECTIVE DATE

                  	 
      	
                    PARTIES

                  
	
                    Santana

                  	 
      	
                    Shared
      Risk Contract - Ecopetrol S.A.

                  	 
      	
                    July
      27, 1987

                  	 
      	
                    Ecopetrol
      S.A., Gran Tierra Energy Colombia Ltd.

                  
	
                    Guayuyaco
      - Gran Tierra Energy Colombia, Ltd.

                  	 
      	
                    Association
      Contract - Ecopetrol S.A.

                  	 
      	
                    September
      30, 2002

                  	 
      	
                    Ecopetrol
      S.A., Gran Tierra Energy Colombia, Ltd., Solana Petroleum Exploration
      (Colombia) Limited

                  
	
                    Chaza

                  	 
      	
                    Exploration
      and Exploitation Contract

                  	 
      	
                    June
      27, 2005

                  	 
      	
                    Agencia
      Nacional de Hidrocarburos, Gran Tierra Energy Colombia, Ltd., Solana
      Petroleum Exploration (Colombia) Limited

                  
	
                    Azar

                  	 
      	
                    Exploration
      and Exploitation Contract

                  	 
      	
                    October
      12, 2006

                  	 
      	
                    Agencia
      Nacional de Hidrocarburos, Gran Tierra Energy Colombia,
    Ltd.

                  
	
                    Piedemonte
      Norte

                  	 
      	
                    Exploration
      and Exploitation Contract

                  	 
      	
                    June
      17, 2009

                  	 
      	
                    Agencia
      Nacional de Hidrocarburos, Gran Tierra Energy Colombia,
    Ltd.

                  
	
                    Piedemonte
      Sur

                  	 
      	
                    Exploration
      and Exploitation Contract

                  	 
      	
                    June
      17, 2009

                  	 
      	
                    Agencia
      Nacional de Hidrocarburos, Gran Tierra Energy Colombia,
    Ltd.

                  
	
                    Rumiyaco

                  	 
      	
                    Exploration
      and Exploitation Contract

                  	 
      	
                    June
      5,  2009

                  	 
      	
                    Agencia
      Nacional de Hidrocarburos, Gran Tierra Energy Colombia,
    Ltd.

                  
	
                    Magangue

                  	 
      	
                    Association
      Contract – Ecopetrol S.A.

                  	 
      	
                    January
      1, 1990

                  	 
      	
                    Ecopetrol
      S.A., Solana Petroleum Exploration (Colombia)
  Limited

                  

          

        

      

    

    

    Schedule
1.02(a) – Page 1

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        	
                Garibay*

              	 
      	
                Exploration
      and Exploitation Contract

              	 
      	
                October
      25, 2005

              	 
      	
                Agencia
      Nacional de Hidrocarburos, Solana Petroleum Exploration (Colombia)
      Limited

              
	
                Rio
      Magdelena*

              	 
      	
                Association
      Contract

              	 
      	
                February
      8, 2002

              	 
      	
                Ecopetrol
      S.A., Gran Tierra Energy Colombia, Ltd.

              
	
                Mecaya*

              	 
      	
                Exploration
      and Exploitation Contract

              	 
      	
                June
      14, 2006

              	 
      	
                Agencia
      Nacional de Hidrocarburos, Gran Tierra Energy Colombia,
    Ltd.

              
	
                Catguas
      *

              	 
      	
                Exploration
      and Exploitation Contract

              	 
      	
                November
      2005

              	 
      	
                Agencia
      Nacional de Hidrocarburos, Solana Petroleum Exploration (Colombia)
      Limited

              

      

    

    

    * These
properties are subject to Letters of Intent and/or sales agreements to third
parties as of the effective date.

    

    Schedule
1.02(a) – Page 2

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
1.02(b)

    Eligible
Buyers

    

    None.

    

    Schedule
1.02(b) – Page 1

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
1.02(c)

    Offtake
Agreements

    

    1)  Agreement
with offer to purchase crude from Santana and Guayuyaco, between Gran Tierra
Energy Colombia, Ltd. and Ecopetrol S.A., signed December 18, 2009 effective
December 19, 2009, expiring 31 December 2010.

    

    2)  Agreement
with offer to purchase crude from Chaza, between Gran Tierra Energy Colombia,
Ltd. and Ecopetrol S.A., signed December 18, 2009, effective January 1, 2010
expiring December 31, 2010.

    

    3)  Agreement
with offer to purchase crude from Guayuyaco, between Solana Petroleum
Exploration (Colombia) Limited and Ecopetrol S.A., signed December 18, 2009,
effective January 1, 2010 expiring December 31, 2010.

    

    4)  Agreement
with offer to purchase crude from Chaza, between Solana Petroleum Exploration
(Colombia) Limited and Ecopetrol S.A., signed December 18, 2009, effective
January 1, 2010 expiring December 31, 2010.

    

    Schedule
1.02(c) – Page 1

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
7.05

    Litigation

    

    1)  Ecopetrol S.A. v. Gran Tierra Energy
Colombia, Ltd. and Solana Petroleum Exploration (Colombia)
Limited.

    

    
      	
               
      

            	
              ·

            	
              Ecopetrol
      S.A. and Gran Tierra Colombia, the contracting parties of the Guayuyaco
      Association Contract, are engaged in a dispute regarding the
      interpretation of the procedure for allocation of oil produced and sold
      during the long term test of the Guayuyaco-1 and Guayuyaco-2 wells. There
      is a material difference in the interpretation of the procedure
      established in Clause 3.5 of Attachment-B of the Guayuyaco Association
      Contract. Ecopetrol S.A. interprets the contract to provide that the
      extended test production up to a value equal to 30% of the direct
      exploration costs of the wells is for Ecopetrol S.A.’s account only and
      serves as reimbursement of its 30% back-in to the Guayuyaco discovery.
      Gran Tierra Colombia’s contention is that this amount is merely the
      recovery of 30% of the direct exploration costs of the wells and not
      exclusively for benefit of Ecopetrol S.A.. There has been no agreement
      between the parties, and Ecopetrol S.A. has filed a lawsuit in the
      Contravention Administrative Court in the District of Cauca regarding this
      matter. Gran Tierra Colombia filed a response on April 29, 2008 in which
      it refuted all of Ecopetrol S.A.’s claims and requested a change of venue
      to the courts in Bogota. Closing arguments were presented by all parties
      during2009. We are awaiting the courts decision. At this time no amount
      has been accrued in the financial statements as Gran Tierra does not
      consider it probable that a loss will be incurred. Ecopetrol S.A. is
      claiming damages of approximately $5.1 million (as of March 31,
      2010).

            

    

    

    2)  Gran Tierra Energy Colombia, Ltd. and
Crosby Capital re: Colombia Participation agreement, high price rights inclusion
dispute

    

    
      	
               
      

            	
              ·

            	
              Gran
      Tierra Energy Colombia, Ltd. is in disagreement with Crosby Capital
      regarding the definition of high price rights as defined in the Agencia
      Nacional de Hidrocarburos contract for the Chaza block.  Crosby
      Capital contends that they do not meet the definition of a royalty or
      production expense and therefore should not be included in the calculation
      of profit (that is deducted from profit) in determining their net profits
      interest under the agreement.  Gran Tierra Energy Colombia, Ltd.
      contends that the payments to Agencia Nacional de Hidrocarburos for high
      price rights do meet the criteria for inclusion in the high price rights
      calculation.  The parties have not been able to reach agreement
      on their own and will proceed to mediation or arbitration in the near
      future.  Total net present value is approximately USD$6 to 7
      million.

            

    

    

    
      Schedule
7.05 – Page 1

        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

    

    

    Schedule
7.06

    Environmental
Matters

     

    None.

    

    Schedule
7.06 – Page 1

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
7.13

    Subsidiaries

    

    
      
        	
                Subsidiary

              	 
      	
                Jurisdiction of

                Organization

              	 
      	
                Percentage

                of Equity

                Interests

                Owned

              	 
      	
                Nature of

                Ownership

              	 
      	
                Owner

              
	
                Gran
      Tierra Callco ULC

              	 
      	
                Alberta

              	 
      	
                100%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Energy Inc.

              
	
                Gran
      Tierra Exchangeco Inc.

              	 
      	
                Alberta

              	 
      	
                100%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Callco ULC

              
	
                Solana
      Resources Limited

              	 
      	
                Alberta

              	 
      	
                9.5%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Exchangeco Inc.

              
	 
      	 
      	 
      	 
      	
                90.5%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Energy Inc.

              
	
                Solana
      Petroleum Exploration (Colombia) Ltd.

              	 
      	
                Cayman
      Islands

              	 
      	
                100%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Energy International Holdings Ltd.

              
	
                Gran
      Tierra Energy Brasil Ltda.

              	 
      	
                Brasil

              	 
      	
                99%

              	 
      	
                Shares

              	 
      	
                Solana
      Resources Limited

              
	 
      	 
      	 
      	 
      	
                1%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Energy Inc. (Alberta)

              
	
                1203847
      Alberta Inc.

              	 
      	
                Alberta

              	 
      	
                100%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Energy Inc.

              
	
                Gran
      Tierra Goldstrike Inc.

              	 
      	
                Alberta

              	 
      	
                100%

              	 
      	
                Shares

              	 
      	
                1203847
      Alberta Inc.

              
	
                Gran
      Tierra Energy Inc.

              	 
      	
                Alberta

              	 
      	
                44%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Goldstrike Inc.

              
	 
      	 
      	 
      	 
      	
                56%

              	 
      	
                Shares

              	 
      	
                Gran
      tierra Energy Inc.

              
	
                Gran
      Tierra Energy Argentina Ltda

              	 
      	
                Argentina

              	 
      	
                99%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Energy Inc. (Alberta)

              
	 
      	 
      	 
      	 
      	
                1%

              	 
      	
                Shares

              	 
      	
                PCESA

              
	
                PCESA

              	 
      	
                Ecuador

              	 
      	
                100%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Energy Inc. (Alberta)

              
	
                Gran
      Tierra Argentina Holdings ULC

              	 
      	
                Alberta

              	 
      	
                100%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Energy Inc. (Alberta)

              
	
                Gran
      Tierra Energy Surcursal del Peru

              	 
      	
                Peru

              	 
      	
                100%

              	 
      	
                Branch

              	 
      	
                Gran
      Tierra Energy Inc.

              
	
                Gran
      Tierra Energy Cayman Islands Inc.

              	 
      	
                Cayman
      Islands

              	 
      	
                100%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Energy International Holdings Ltd.

              
	
                Gran
      Tierra Energy International Holdings Ltd.

              	 
      	
                Cayman
      Islands

              	 
      	
                100%

              	 
      	
                Shares

              	 
      	
                Solana
      Resources Limited

              
	
                Argosy
      Energy Corporation LLC

              	 
      	
                Delaware

              	 
      	
                100%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Energy Cayman Islands Inc.

              
	
                Gran
      Tierra Energy Colombia Ltd.

              	 
      	
                Utah

              	 
      	
                100%

              	 
      	
                Partnership

              	 
      	
                General
      Partner – Argosy Energy Corporation LLC.

                Limited
      Partner – Gran Tierra Energy Caymans Islands Inc.

              
	
                Gran
      Tierra Energy Canada ULC

              	 
      	
                Alberta

              	 
      	
                100%

              	 
      	
                Shares

              	 
      	
                Gran
      Tierra Energy Cayman Islands
Inc.

              

      

    

    

    Schedule
7.13 – Page 1

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
7.18

    Swap
Agreements

    

    None.

    

    Schedule
7.18 – Page 1

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
9.02

    Debt

     

    Gran
Tierra Energy Inc. (an Alberta corporation) has $2,460,341 of debt owed to
Borrower

    

    Gran
Tierra Energy Argentina Limitada has $2,812,896 of debt owed to
Parent

    

    Gran
Tierra Energy Inc. (an Alberta corporation) has $41,743,090 of debt owed to
Parent

    

    Gran
Tierra Energy Inc Sucursal del Peru has $5,168,389 of debt owed to
Parent

    

    Gran
Tierra Energy Canada ULC has $6,733,652 of debt owed to Gran Tierra Energy
Cayman Islands Inc.

    

    Schedule
9.02 – Page 1

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
9.05

    Investments

     

    1.           Borrower
has made the following intercompany investments:

    A.           $2,460,341
in Gran Tierra Energy Inc. (an Alberta corporation)

    B.           $1,909,709
in Gran Tierra Energy Brasil Limitada

    

    2.           Parent
has made the following intercompany investments:

    A.           $2,812,896
in Gran Tierra Energy Argentina Limitada

    B.           $41,743,090
in Gran Tierra Energy Inc. (an Alberta corporation)

    C.           $5,168,389
in Gran Tierra Energy Inc Sucursal del Peru

    D.           $186,158
in Gran Tierra Energy Brasil Limitada

    

    3.           GTE
Cayman Islands has made the following intercompany investments:

    A.           $6,733,652
in Gran Tierra Energy Canada ULC

    

    Schedule
9.05 – Page 1

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