Document:

Exhibit 1 (10.1) - Employment Agreement

    
      

      

    

     

    

     

    

      

      EMPLOYMENT
        AGREEMENT 

      

      This
        Agreement, effective as of the 25th day of September (the “Effective Date”),
        executed on the dates written hereafter is made by and between: 

      

      Chapeau,
        Inc., d/b/a BluePoint Energy, Inc. (“Company”), whose business address
        is

      1190
        Suncast Lane, Suite 2, El Dorado Hills, California 95762; and

      

      Ronald
        K.
        Rinehart (“Employee”), whose mailing address is 175 Silberhorn Drive, Folsom,
        California 95630; 

       

      both
        of
        which entities are referred to herein as the “Parties.”

      

      RECITALS

      

      A.    Company
        is in the business of developing, manufacturing, selling and servicing power
        generation, cogeneration, and tri-generation systems and energy service
        agreements for end-users in need of reliable, efficient, ultra-clean, and
        economic power solutions.

      

      B.    In
        the
        course of Company’s business certain confidential and proprietary information is
        developed which Company intends to treat as trade secrets.

      

      C.    Company
        and its officers, and employees receive confidential and proprietary information
        from Company’s customers and other third parties for which Company has
        contractual obligations to maintain such information in confidence.

      

      D.    It
        is
        anticipated that in the course of performing services for Company, Employee
        will
        develop inventions or work which may be protectable by patent, trademark
        or
        copyright laws which will belong solely to Company.

      

      E.   
           It
        is
        desirable to specify how matters of confidentiality and assignment of rights
        will be handled and to enumerate Employee’s rights and obligations with respect
        to Company.

      

      AGREEMENTS

      

      NOW
        THEREFORE,
        in
        consideration of the foregoing Recitals and of the covenants and agreements
        hereinafter contained, and other good and valuable consideration the receipt
        and
        sufficiency of which are now acknowledged, the undersigned parties, intending
        to
        be legally bound, hereby covenant and agree as follows: 

      

      

      1190
        Suncast Lane, Suite 2 ·
        El Dorado Hills, CA 95762 ·
        P - 916.939.8700 ·
        F - 916.939.8705

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

      
        	
                1)

              	
                Definitions.

              

      

      

      
        	 	
                a)

              	
                Confidential
                  Information
                  shall mean any information, whether tangible or intangible, including
                  scientific or technical information, design, product, processes,
                  procedure, composition, pattern, devices, plans, formulae, improvements,
                  business or financial information, data bases, or other information
                  which
                  gives the owner of the information a competitive advantage and
                  which the
                  owner has taken steps to protect from disclosure to persons other
                  than
                  those selected by the owner to receive such information. Confidential
                  Information
                  does not include information, which becomes publicly known through
                  lawful
                  means, or information that was rightly in Employee’s possession prior to
                  the Effective Date. Confidential
                  Information
                  includes that owned by Company or any of Company’s customers, which
                  becomes known to Employee in the course of his employment hereunder.
                  Confidential
                  Information
                  also includes information obtained by Company from a third party
                  under
                  obligations to maintain its confidentiality. Confidential
                  Information
                  includes, but is not limited to, “trade secrets,” but Confidential
                  Information
                  need not satisfy the legal definition or requirements of a “trade secret”
                  to be protected under this
                  Agreement.

              

      

      

      
        	 	
                b)

              	
                Intellectual
                  Property
                  shall mean work product, functional designs, technical designs,
                  and
                  software including programs, modules, code, algorithms, flowcharts,
                  data
                  diagrams, documentation and the like, tangible and intangible products,
                  inventions, developments, manufacturing processes, copyrights,
                  improvements, concepts and ideas, whether patentable or not. Intellectual
                  Property
                  shall also mean all Intellectual
                  Property
                  which is related to, or is capable of use in any way in connection
                  with
                  Company’s business or its corporate affiliates and made, conceived,
                  developed, or perfected by Employee, alone or with others, as a
                  result of
                  performance of his duties under this Agreement or two years after
                  the
                  termination of this Agreement, during any prior relationship with
                  Company,
                  from the use of any Company facilities, resources, or proprietary
                  information, and/or made, conceived, developed, perfected by Employee
                  as a
                  result of Employee’s association with
                  Company.

              

      

      

      
        	 	
                c)

              	
                "Customer"
                  and "Prospective Customer" Defined.
                  As
                  used herein, the term "Customer" shall include any person or entity
                  to
                  whom services or products are sold by Company, and any person or
                  entity
                  with whom Company has established strategic marketing, services
                  or other
                  alliances. The term "Prospective Customer" shall include any person
                  or
                  entity toward whom Company has directed efforts to establish a
                  customer
                  relationship or strategic alliance and with whom Company has a
                  reasonable
                  expectation of establishing such a relationship or
                  alliance.

              

      

      

      
        	
                2)

              	
                Employment.
                  Company hereby employs the Employee, and Employee hereby accepts
                  employment with Company on the terms set out in this
                  Agreement.

              

      

      

      
        
           

        

        
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                3)

              	
                Scope
                  of Duties. Employee
                  is engaged generally to perform those duties described in Appendix
                  A and
                  those duties assigned by the Chief Operating Officer of Company
                  from time
                  to time and all related duties. Employee agrees to devote his full
                  business time and attention exclusively to the performance of these
                  duties
                  and further agrees to perform these duties faithfully, industriously,
                  and
                  to the best of his ability, experience, and talents, and to the
                  reasonable
                  satisfaction of Company. Such duties shall be provided at such
                  place(s) as
                  the needs, business, or opportunities of Company may
                  require.

              

      

      

      
        	
                4)

              	
                Supervisor.
                  Employee will be a member of the Company’s Executive Management Team
                  reporting and responsible to the Chief Operating Officer of Company
                  or
                  such other authorized representative of Company as may be identified
                  to
                  Employee by the Chief Operating Officer, Chief Executive Officer
                  or the
                  Board of Directors of Company.

              

      

      

      
        	
                5)

              	
                Compensation and
                  Benefits.
                  Company will pay the following compensation to Employee pursuant
                  to this
                  Agreement:

              

      

      

      a.    Beginning
        on the Effective Date, Company will pay Employee salary at the rate of $150,000
        (One Hundred Fifty Thousand and 00/100 United States Dollars) per year, payable
        on Company’s normal payroll cycle, which salary shall be subject to required
        withholding and employment taxes levied by federal, state and local governments.
        Such salary may be adjusted from time to time by mutual agreement of the
        parties. Employee will have periodic performance reviews in accordance with
        Company’s policy at which time Employee’s compensation will be
        addressed.
        All
        other provisions of this Agreement will remain unchanged.

      

      b.    Employee
        will be entitled to a first bonus in the amount of $75,000 (Seventy Five
        Thousand and 00/100 United States Dollars) payable at the completion of
        Employee’s first year of employment.

      

      c.    Employee
        will be granted options to purchase 500,000 (Five Hundred Thousand) shares
        of
        the Company’s common stock which options will have a per share exercise price of
        $1.38 and will vest ratably over the succeeding 36 months from the Effective
        Date. Other terms and conditions concerning the stock options will be further
        delineated to a stock option agreement to be drafted by the Company’s
        counsel.

      

      d.    Company
        may create and change from time to time employee handbooks and/or policy
        manuals
        and provide same to Employee. Such handbooks or policy manuals are intended
        to
        provide instruction and guidance to employees concerning operating procedures
        and current working policies of the Company but shall not be deemed to be
        and
        Employee understands that they are not a contract between the parties and
        are
        not part of this Agreement. The Company is free to follow or not follow
        procedures and policies set forth in the handbooks or policy manuals depending
        upon the business needs and conditions as solely determined by the Company.
        Employee may not rely upon anything contained in such handbooks or policy
        manuals as requiring any specific or general action of Company.

      

      
        
           

        

        
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      e.    The
        Company maintains various employee benefit plans including a medical plan.
        The
        Company will permit Employee to become a participant in any medical, optical,
        dental and life insurance plan, pension plan, profit sharing plan, and/or
        performance award programs established by Company, provided Employee has
        become
        eligible to participate in such plan or program according to the terms and
        conditions of said plan or program. Employee shall be eligible for vacation,
        sick time, and holidays in accordance with the policies and practices of
        the
        Company. Vacation must be taken at a time convenient to Company and must
        be
        approved in advance by Company. 

      

      f.    Company
        reserves the absolute right to make any changes in assignment, personnel,
        or
        employee benefits at any time.

      

      
        	6.	
                Employment
                  Term.
                  Employee’s employment shall continue for a period of three years (such
                  three-year period is referred to herein as the “Full Employment Term” from
                  the Effective Date of this Agreement, unless Employee’s employment is
                  terminated prior to the expiration of the Full Employment Term,
                  as
                  provided in this Section 6 of the Agreement (such shorter period
                  is
                  referred to herein as the “Employment Term”). Employee’s obligations as
                  specified in Sections 7-14 below, shall survive any termination
                  of this
                  Agreement.

              

      

      

      a.    Termination
        For Cause.
        Company
        may terminate Employee’s employment for cause as defined in Section 6(a)(ii)
        below.

      

      
        	 	
                i.

              	
                If
                  Company terminates Employee’s employment for cause, Employee shall be
                  entitled to receive payment of that portion of Employee’s annual salary
                  under Section 5(a) that Employee earned through and including the
                  Termination Date at the rate of the annual salary in effect at
                  that time,
                  but shall be entitled to no other compensation under this
                  Agreement.

              

      

      

      
        	 	
                ii.

              	
                Termination
                  “for cause” shall mean termination by the Company of Employee’s employment
                  with Company because of (A) any act or omission that constitutes
                  a
                  material breach by Employee of his obligations under this Agreement,
                  including, but not limited to, Employee’s breach of Sections 8-10 of this
                  Agreement; (B) any failure, willful or otherwise, by Employee to
                  perform
                  the duties, meet the performance criteria or to otherwise serve
                  Company in
                  the capacities prescribed by the Company in accordance with Section
                  3,
                  provided that with respect to the first occurrence only of any
                  such
                  willful failure, such willful failure remains uncured more than
                  ten (10)
                  business days after the date on which the Company first provides
                  written
                  notice of such first occurrence or willful failure to Employee;
                  (C) a
                  criminal conviction, guilty plea, or no contest plea of Employee
                  for any
                  felony, any drug related offense, or a crime involving an act of
                  moral
                  turpitude; or (D) Employee’s perpetration of an act of fraud or
                  embezzlement against Company.

              

      

      

      
        	 	
                iii.

              	
                Company
                  may terminate for cause Employee’s employment with Company by giving
                  written notice to Employee at least twenty-four (24) hours prior
                  to the
                  Terminate Date. “Termination Date” shall mean the actual date Employee
                  terminates employment with Company as a result of action taken
                  by the
                  Company, and not as a result of Employee’s resignation from employment as
                  provided in Section 6(b).

              

      

      

      
        
           

        

        
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      b.    Resignation.
        Employee
        may resign his employment with Company at any time for any reason by providing
        written notice to the Supervisor set forth in Section 4 of this Agreement
        of the
        resignation at least thirty (30) days, but not more than one hundred twenty
        (120) days, prior to the effective date the resignation (the “Resignation
        Notice”). The effective date of Employee’s resignation shall be that date
        specified in the Resignation. Employee shall not make public any information
        relating to his resignation until the Resignation Date. If Employee resigns
        from
        his employment, Employee shall be entitled to receive payment of that portion
        of
        Employee’s annual salary under Section 5(a) that Employee earned through and
        including the Resignation Date at the rate of annual salary in effect at
        that
        time, but shall be entitled to no other compensation under this
        Agreement.

      

      c.    Termination
        Other Than For Cause.
        If,
        prior to the expiration of the Full Employment Term, Company terminates
        Employee’s employment other than for cause or Permanent Disability, Employee
        shall be entitled to receive, in addition to amounts payable pursuant to
        Section
        6(e), payment of that portion of Employee’s annual salary under Section 5(a)
        that Employee earned through and including the Termination Date at the rate
        of
        annual salary in effect at that time.

      

      d.    Disability.
        Employee shall be deemed “Permanently Disabled” when he is deemed permanently
        disabled in accordance with the disability insurance policy of Company in
        effect
        at the time of the illness or injury causing the disability, or, in the event
        no
        disability policy is in effect, in accordance with the disability policy
        of
        Company last in effect. If, Employee becomes Permanently Disabled, the Company
        may terminate Employee’s employment with Company as a result of the Permanent
        Disability by providing written notice to Employee at least seventy-two (72)
        hours prior to the Termination Date. If Employee resigns from Employment
        with
        Company as a result of a Permanent Disability or Company terminates Employee’s
        employment as a result of a Permanent Disability, Employee shall be entitled
        to
        that portion of the annual salary, at the rate in effect when he became
        Permanently Disabled, that he earned through and including his last day of
        employment with Company.

      

      e.    Compensation
        Following Termination.
        If
        Employee’s termination of employment is pursuant to Section 6(c) of this
        Agreement, in addition to any other amounts due or benefits to be paid to
        Employee pursuant to this Agreement, Company shall pay to Employee, or to
        Employee’s estate or personal representative: (i) an amount equal to the annual
        salary under Section 5(a) to which Employee would have been entitled had
        the
        Employee remained employed by Company for the Full Employment Term (the annual
        salary, divided by twelve, multiplied by the number of whole or fractional
        months remaining in the Full Employment Term after Employee’s last day of
        employment with Company), to be paid in four equal quarterly installments
        on the
        first day of each consecutive subsequent calendar quarter, or the next business
        day if the first such day is a Saturday, Sunday or legal holiday, provided
        that
        if termination of employment occurs during the last year of the Full Employment
        Term, any unpaid amount owed to Employee shall be paid no later than the
        last
        day of the Full Employment Term; and (ii) the amount due, if any, in accordance
        with the terms of Section 5(b).

      

      
        
           

        

        
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      7.       
         Noninterference
        with Third Party Rights. Company
        is employing Employee with the understanding that during the Term of
        Employment:

      

      a. Employee
        is free to enter into employment with Company; and 

      

      b. Only
        Company is entitled to benefit from Employee’s work. Company has no interest in
        using any third party’s patents, copyrights, trade secrets, or trademarks in any
        unlawful manner. Employee will not use for the benefit of, or divulge to
        Company, or its personnel, any proprietary information of a third party without
        the prior written permission of the third party.

      

      8.    Non-disclosure
        of Confidential Information.
        Due to
        the nature of Employee’s duties hereunder, he will have access to and will
        acquire or develop, Confidential
        Information.
        Employee acknowledges that Confidential
        Information
        has been
        developed by its owner at great expense and effort, are being revealed in
        strict
        confidence solely for the purpose of allowing Employee to perform duties
        for
        Company, and that disclosure of Confidential
        Information,
        could
        cause substantial damage to Company and third parties. Therefore, Employee
        agrees that:

      

      a.    Employee
        shall use Confidential
        Information
        only in
        performing duties and services related to his employment at Company and will
        only discuss Confidential
        Information
        with
        other authorized employees of Company and only when necessary to the performance
        of his duties.

      

      b.    During
        the term of this Agreement and afterward, Employee will hold all Confidential
        Information
        in
        strict confidence for the sole benefit of Company and will not induce or
        permit
        others to use or have access to any Confidential
        Information
        for any
        purpose whatsoever except as provided for in this Agreement. Employee will
        not
        use, reveal, copy, disclose, discuss, transfer or remove any Confidential
        Information
        except
        as necessary to perform his duties hereunder.

      

      c.    At
        no
        time will Employee use any Confidential
        Information
        for
        Employee’s own commercial and business purposes, including participation as an
        employee, partner, director, investor, officer, stockholder, member, or joint
        venture participant in any commercial or business enterprise, nor shall Employee
        take, use, copy, transfer, conceal or retain possession of property representing
        the Confidential
        Information
        for
        Employee’s own use or for the use of any other person.

      

      9.    Assignment
        of Intellectual Property.
        During
        the duration of this Agreement and for two years thereafter, Employee may,
        either alone or with others, during working hours or not, develop Intellectual
        Property, which
        may
        be protectable by patent, trademark or copyright law. Employee agrees that
        as
        consideration for this Agreement, Company will solely own all Intellectual
        Property
        and all
Intellectual
        Property will
        be
        considered “work made for hire.” If by operation of law or otherwise, any
Intellectual
        Property is
        not
“work made for hire” or if ownership of all right, title, and interest in the
Intellectual
        Property
        does not
        vest exclusively in Company, Employee hereby irrevocably assigns, to Company
        its
        successors and assigns, Employee’s entire right, title, and interest in and to
        all Intellectual
        Property
        including all patents, applications, trademarks, and copyrights. Employee
        agrees
        that such assignment is supported by adequate consideration under this
        Agreement.

      

      
        
           

        

        
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      Employee
        agrees to disclose promptly and fully to the Company all Intellectual
        Property
        and to
        advise Company’s president or designated intellectual property manager of all
Intellectual
        Property.
        Employee shall also keep and maintain adequate and current written records
        of
        all such Intellectual
        Property
        describing its nature, use, and operation. Records shall be in the form of
        notes, sketches and drawings or reports relating thereto, and will be the
        property of, and available to, the Company at all times.

      

      Concepts,
        copyrights, and inventions which do not relate, directly or indirectly to
        Company’s business or which Employee developed independent of his association
        with Company or Company’s business and on his own without use of Company’s time,
        resources, equipment or Confidential
        Information
        are
        expressly excluded from “works made for hire.” Any inventions owned by Employee
        prior to the Effective Date are enumerated in Appendix B hereto and are excluded
        from Employee's obligations under this Agreement. If not listed, the Parties
        agree that it shall be conclusively presumed that any relevant Intellectual
        Property
        which
        may have been listed, whether completed or not, at the execution of this
        Agreement, were not listed because they are agreed to belong exclusively
        to
        Company.

      

      Employee
        will promptly deliver all Intellectual
        Property
        to
        Company and at the request of the Company, will execute and deliver all proper
        assignments thereto.

      

      10. 
          Protection
        and Maintenance.
        At the
        request of the Company, Employee will at any time do all things reasonably
        required in order to protect and maintain Company’s rights in Intellectual
        Property
        including executing all proper papers for use in applying for, obtaining
        and
        maintaining United States and foreign patents and/or copyrights relating
        to
Intellectual
        Property
        as the
        Company may desire, but at the sole expense of the Company or its
        affiliate.

      

      11.    Not
        Used

      

      12.    Company
        Right to Injunctive Relief. In
        the
        event of the breach or threatened breach of Sections 8-11 of this Agreement
        by
        Employee, Company shall be entitled to all appropriate legal and equitable
        relief, including without limitation temporary restraining orders, preliminary
        and permanent injunctions, and monetary damages. The parties agree that in
        the
        event of a breach of this Agreement, the total damages sustained by Company
        may
        be difficult or impossible to ascertain. The parties hereby agree that no
        performance bond is necessary in obtaining the equitable relief provided
        for in
        this Section 12.

      

      13.    Severability.
        If any
        provision of this Agreement as applied to any party or to any circumstances
        is
        adjudged by a court to be unreasonable, invalid or unenforceable as written
        as
        to duration, geographic scope, nature or scope of activities affected, nature
        or
        scope of information covered, or in any other respect, the same will in no
        way
        affect any other provision hereof, the application of such provision in any
        other circumstances, or the validity or enforceability of this Agreement.
        The
        parties agree that the court making a determination that any provision hereof
        is
        unreasonable, invalid or unenforceable as written will have the power to
        reduce
        or alter the duration, area, nature or scope of the subject provision, and
        in
        its reduced or altered form or version such provision will then be enforceable
        and will be enforced.

      

      
        
           

        

        
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      14.    Return
        of Property.
        Upon
        termination of this Agreement, Employee shall deliver all Company’s property
        (including keys, documents, records, notes, electronic data, memoranda, models,
        and equipment) and Confidential
        Information, which
        is
        in Employee’s possession or under Employee’s control.

      

      15.    Non-waiver.
        The
        failure of either Party to enforce at any time any of the provisions of this
        Agreement, or to take action as a result of any breach of any provisions
        of this
        Agreement, shall in no way be considered to be a waiver of such provisions
        or in
        any way to affect the validity of this Agreement.

      

      16.    Non-assignment.
        This
        Agreement constitutes a personal contract and Employee shall not transfer
        or
        assign his rights or obligations hereunder; provided, however, Employee may
        assign his right to receive all or part of Employee’s compensation upon giving
        Company written notice of such assignment. Payment in accordance with such
        assignment shall be deemed a fulfillment of Company’s obligations
        hereunder.

      

      17.    Binding
        Effect.
        This
        Agreement shall inure to the benefit of and be binding upon Company, its
        successors and assigns and on Employee, his heirs, guardians and personal
        or
        legal representatives.

      

      a.    Governing
        Law.
        This
        Agreement shall be governed by and construed in accordance with the laws
        of the
        State of California, irrespective of where Employee’s duties are to be
        performed. The invalidity or unenforceability of any provisions hereof shall
        in
        no way affect the validity or enforceability of any other
        provision.

      

      18.    Entire
        Agreement.
        This
        Agreement contains the entire agreement of the Parties and may be amended,
        extended, or rescinded only by a writing signed by the Parties.

      

      19.    Company’s
        Additional Rights.
        This
        Agreement will be supplemental to and not in derogation of any rights which
        Company may have concerning any matter covered in this Agreement, including
        but
        not limited to any information which may have been obtained by Employee during
        the course of his employment or any Intellectual
        Property
        which he
        has made or may make.

      

      20.    Notices.
        All
        notices required or permitted under this Agreement shall be deemed delivered
        when delivered in person or deposited in the United States mail, postage
        prepaid, addressed to the parties at the addresses designated in the first
        paragraph of this Agreement. Notices to Company shall be in care of its Chief
        Operating Officer.

      

      IN
        WITNESS WHEREOF, the Parties have executed this Agreement as of the dates
        written below. The Employee acknowledges receipt of a completed copy of this
        Agreement.

      

      

      

      
        
           

        

        
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                CHAPEAU,
                  INC d/b/a BLUEPOINT ENERGY,
                  INC.

              	
                RONALD
                  K. RINEHART

              
	 	 
	
                By  
                  /s/
                  Guy A.
                  Archbold                              
                  

              	
                By  
                  /s/
                  Ronald K.
                  Rinehart                            
                  

              
	 	 
	
                Title  
                  CEO                                                  
                   

              	
                Date  
                  September
                  11,
                  2006                           

              
	 	 
	
                Date  
                  September
                  11,
                  2006                           
                  

              	 

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      
        
           

        

        
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      APPENDIX
        A

      

      SCOPE
        OF DUTIES 

      

      Employee
        will be responsible for acting as Executive Vice President of Field Operations
        with initial responsibilities focusing on the areas of project management,
        field
        engineering, field installation, and field construction and management. The
        Employee will be a member of the Company’s Executive Management Team
        under
        the direction of the Company’s Chief Operating Officer. 

      

      Employee
        and Company agree that each of them will, within 120 days of Employee’s
        Employment, use his best efforts to agree to and document a detail scope
        of
        duties, including performance milestones and/or other Employee performance
        criteria as well as corresponding incentive compensation programs which might
        include one or more of the following elements: (i) annual bonus; (ii) salary
        increase; (iii) additional stock options. 

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      
        
           

        

        
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      APPENDIX
        B

      

      PREEXISTING
        INVENTIONS, COPYRIGHTS, CONCEPTS,

      WORKS,
        ETC. WHICH BELONG TO EMPLOYEE

      

       

      None.

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       11Exhibit
10.1

EXECUTION
VERSION

 

 

 

 

FIRST AMENDMENT

TO

CREDIT AGREEMENT

Dated as of November 1, 2006

AMONG

TETON ENERGY CORPORATION,

AS BORROWER,

THE GUARANTORS,

BNP PARIBAS,

AS ADMINISTRATIVE AGENT,

AND

THE LENDERS PARTY HERETO

 

FIRST AMENDMENT TO CREDIT AGREEMENT

THIS FIRST AMENDMENT TO CREDIT
AGREEMENT (this “First
Amendment”) dated as of November 1, 2006, is among TETON ENERGY
CORPORATION, a Delaware
corporation (the “Borrower”); each of the undersigned guarantors (the “Guarantors”,
and together with the Borrower, the “Obligors”); each of the lenders
party to the Credit Agreement referred to below (collectively, the “Lenders”);
and BNP PARIBAS, as administrative agent for the Lenders (in such capacity,
together with its successors in such capacity, the “Administrative Agent”).

R
E C I T A L S

A.            The Borrower, the
Administrative Agent and the Lenders are parties to that certain Credit
Agreement dated as of June 15, 2006 (the “Credit Agreement”), pursuant
to which the Lenders have made certain credit available to and on behalf of the
Borrower.

B.            The Borrower has
requested and the Administrative Agent and the Lenders have agreed to amend
certain provisions of the Credit Agreement.

C.            NOW, THEREFORE, to
induce the Administrative Agent and the Lenders to enter into this First
Amendment and in consideration of the premises and the mutual covenants herein
contained, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:

Section 1.       Defined Terms.  Each capitalized term used herein but not
otherwise defined herein has the meaning given such term in the Credit
Agreement, as amended by this First Amendment. 
Unless otherwise indicated, all section references in this First
Amendment refer to sections of the Credit Agreement.

Section 2.       Amendments to Credit Agreement.

2.1           Amendments to Section 1.02.

(a)           The following definition is hereby
added where alphabetically appropriate to read as follows:

“First Amendment” means that certain First Amendment
to Credit Agreement, dated as of November 1, 2006, among the Borrower, the
Guarantors, the Administrative Agent and the Lenders party thereto.

2.2           Amendment to Section 3.05(a).  The first sentence of Section 3.05(a) is
hereby amended in its entirety to read as follows:

The Borrower agrees to pay to the Administrative Agent
for the account of each Lender a commitment fee, which shall accrue at 0.500%
per annum 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.

Section 3.       Conditions Precedent.  This First Amendment shall not become
effective until the date on which each of the following conditions is satisfied
(or waived in accordance with Section 12.02 of the Credit Agreement) (the “Effective
Date”):

3.1           The Administrative Agent shall have
received from the Majority Lenders, counterparts (in such number as may be
requested by the Administrative Agent) of this First Amendment signed on behalf
of such Person.

3.2           The Administrative Agent and the
Lenders shall have received all fees and other amounts due and payable on or
prior to the date hereof.

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3.3           No Default shall have occurred and be
continuing as of the date hereof, after giving effect to the terms of this
First Amendment.

3.4           The Administrative Agent shall have
received such other documents as the Administrative Agent or its special
counsel may reasonably require.

The Administrative Agent is hereby authorized and directed to declare
this First Amendment to be effective when it has received documents confirming
or certifying, to the satisfaction of the Administrative Agent, compliance with
the conditions set forth in this Section 3 or the waiver of such conditions as permitted
hereby. Such declaration shall be final, conclusive and binding upon all
parties to the Credit Agreement for all purposes.

Section 4.       Miscellaneous.

4.1           Confirmation.  The provisions of the Credit Agreement, as
amended by this First Amendment, shall remain in full force and effect
following the effectiveness of this First Amendment.

4.2           Ratification and Affirmation;
Representations and Warranties.  Each
Obligor hereby (a) acknowledges the terms of this First Amendment; (b) ratifies
and affirms its obligations under, and acknowledges, renews and extends its
continued liability under, each Loan Document to which it is a party and agrees
that each Loan Document to which it is a party remains in full force and
effect, except as expressly amended hereby, notwithstanding the amendments
contained herein and (c) represents and warrants to the Lenders that as of the
date hereof, after giving effect to the terms of this First Amendment:  (i) all of the representations and warranties
contained in each Loan Document to which it is a party are true and correct,
except to the extent any such representations and warranties are expressly
limited to an earlier date, in which case, such representations and warranties
shall continue to be true and correct as of such specified earlier date, (ii)
no Default or Event of Default has occurred and is continuing and (iii) no
event or events have occurred which individually or in the aggregate could
reasonably be expected to have a Material Adverse Effect.  

4.3           Counterparts.  This First Amendment may be executed by one
or more of the parties hereto in any number of separate counterparts, and all
of such counterparts taken together shall be deemed to constitute one and the
same instrument.  Delivery of this First
Amendment by facsimile transmission shall be effective as delivery of a
manually executed counterpart hereof.

4.4           No Oral Agreement.  This First Amendment, the Credit Agreement
and the other Loan Documents executed in connection herewith and therewith
represent the final agreement between the parties and may not be contradicted
by evidence of prior, contemporaneous, or unwritten oral agreements of the
parties.  There are no subsequent oral
agreements between the parties.

4.5           GOVERNING LAW.  THIS FIRST AMENDMENT (INCLUDING, BUT NOT
LIMITED TO, THE VALIDITY AND ENFORCEABILITY HEREOF) SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS.

4.6           Payment of Expenses.  In accordance with Section 12.03 of the
Credit Agreement, the Borrower agrees to pay or reimburse the Administrative
Agent for all of its reasonable out-of-pocket costs and reasonable expenses
incurred in connection with this First Amendment, any other documents prepared
in connection herewith and the transactions contemplated hereby, including,
without limitation, the reasonable fees and disbursements of counsel to the
Administrative Agent.

4.7           Severability.  Any provision of this First Amendment which
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.

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4.8           Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.

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IN WITNESS WHEREOF, the parties hereto have caused this First Amendment
to be duly executed as of the date first written above.

	
  BORROWER:

  	
  TETON ENERGY CORPORATION

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
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  GUARANTORS:

  	
   

  	
  TETON NORTH AMERICA LLC

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  Teton Energy Corporation, its

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  sole member

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  TETON PICEANCE LLC

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  Teton North America LLC,

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  its sole member

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  TETON DJ LLC

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  Teton North America LLC,

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  its sole member

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  TETON WILLISTON LLC

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  Teton North America LLC,

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  its sole member

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ADMINISTRATIVE
  AGENT:

  	
  BNP PARIBAS, as
  Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  	
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  LENDER:

  	
   

  	
  BNP PARIBAS, as a
  Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
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 6

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00113-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00113-of-00352.parquet"}]]