GRAN TIERRA ENERGY INC. and PETROLIFERA PETROLEUM LIMITED and COMPUTERSHARE TRUST COMPANY OF CANADA

EX-4.6 2 v219607_ex4-6.htm SUPPLEMENTAL WARRANT INDENTURE

Exhibit 4.6

GRAN TIERRA ENERGY INC.

and

PETROLIFERA PETROLEUM LIMITED

and

COMPUTERSHARE TRUST COMPANY OF CANADA

SUPPLEMENTAL WARRANT INDENTURE

March 18, 2011

TABLE OF CONTENTS

		Page

ARTICLE 1	INTERPRETATION	2

1.1	Definitions	2
1.2	Gender and Number	4
1.3	Interpretation not Affected by Headings, etc	4
1.4	Day not a Business Day	4
1.5	Time of the Essence	4
1.6	Applicable Law	5
1.7	Severability	5
1.8	Conflicts	5
1.9	Supersedes Original Indenture	5

ARTICLE 2	ISSUE OF WARRANTS	5

2.1	Issue of Warrants	5
2.2	Acceleration of Expiry Date	5
2.3	Form and Terms of Warrants	6
2.4	Warrantholder not a Shareholder	6
2.5	Warrants to Rank pari passu	6
2.6	Signing of Warrant Certificates	6
2.7	Certification by the Warrant Agent	7
2.8	Issue in Substitution for Warrant Certificates Lost, etc	7
2.9	Exchange of Warrant Certificates	7
2.10	Transfer of Warrants	8
2.11	Charges for Exchange and Transfer	8
2.12	Registration of Warrants	8
2.13	Transferee Entitled to Registration	8
2.14	Registers Open for Inspection	9
2.15	Ownership of Warrants	9

ARTICLE 3	EXERCISE OF WARRANTS	9

3.1	Method of Exercise of Warrants	9
3.2	Effect of Exercise of Warrants	10
3.3	Partial Exercise of Warrants; Fractions	10
3.4	Expiration of Warrants	11
3.5	Cancellation of Surrendered Warrants	11
3.6	Accounting and Recording	11
3.7	Common Share Certificates	11

ARTICLE 4	ADJUSTMENT OF NUMBER OF COMMON SHARES	12

4.1	Adjustment of Number of Common Shares	12
4.2	Entitlement to Shares on Exercise of Warrant	15
4.3	No Adjustment for Stock Options or Warrants	15
4.4	Determination by Corporation's Auditors	15
4.5	Proceedings Prior to any Action Requiring Adjustment	15
4.6	Certificate of Adjustment	15
4.7	Notice of Special Matters	16
4.8	No Action after Notice	16
4.9	Protection of Warrant Agent	16
4.10	Other Adjustments	16

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TABLE OF CONTENTS

(continued)

		Page

ARTICLE 5	RIGHTS AND COVENANTS OF THE CORPORATION	17

5.1	Optional Purchases by the Corporation	17
5.2	General Covenants	17
5.3	Warrant Agent's Remuneration and Expenses	17
5.4	Performance of Covenants by Warrant Agent	18

ARTICLE 6	ENFORCEMENT	18

6.1	Suits by Warrantholders	18
6.2	Limitation of Liability	19
6.3	Waiver of Default	19

ARTICLE 7	MEETINGS OF WARRANTHOLDERS	20

7.1	Right to Convene Meetings	20
7.2	Notice	20
7.3	Chairman	20
7.4	Quorum	20
7.5	Power to Adjourn	21
7.6	Show of Hands	21
7.7	Poll and Voting	21
7.8	Regulations	21
7.9	Corporation and Warrant Agent May be Represented	22
7.10	Powers Exercisable by Extraordinary Resolution	22
7.11	Meaning of Extraordinary Resolution	23
7.12	Powers Cumulative	23
7.13	Minutes	23
7.14	Instruments in Writing	24
7.15	Binding Effect of Resolutions	24
7.16	Holdings by Corporation Disregarded	24

ARTICLE 8	SUPPLEMENTAL INDENTURES	24

8.1	Provision for Supplemental Indentures for Certain Purposes	24
8.2	Successor Corporations	25

ARTICLE 9	CONCERNING THE WARRANT AGENT	25

9.1	Trust Indenture Legislation	25
9.2	Rights and Duties of Warrant Agent	25
9.3	Evidence, Experts and Advisers	26
9.4	Documents, Monies, etc. Held by Warrant Agent	27
9.5	Actions by Warrant Agent to Protect Interest	27
9.6	Warrant Agent Not Required to Give Security	27
9.7	Protection of Warrant Agent	27
9.8	Replacement of Warrant Agent; Successor by Merger	28
9.9	Conflict of Interest	28
9.10	Acceptance of Trust	29
9.11	Warrant Agent Not to be Appointed Receiver	29
9.12	Knowledge of Warrant Agent	29
9.13	Indemnification of Warrant Agent	29
9.14	Warrant Agent Not Required to Give Notice of Default	29
9.15	Warrant Agent's Right Not to Act	30

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TABLE OF CONTENTS

(continued)

		Page

9.16	No Third Party Interests	30

ARTICLE 10	GENERAL	30

10.1	Notice to the Corporation and the Warrant Agent	30
10.2	Notice to Warrantholders	31
10.3	Evidence of Ownership	31
10.4	Counterparts	32
10.5	Satisfaction and Discharge of Indenture	32
10.6	Provisions of Supplemental Indenture and Warrants for the Sole Benefit of Parties and Warrantholders	32
10.7	Warrants Owned by the Corporation or its Subsidiaries – Certificate to be Provided	32
10.8	Matters Relating to the Privacy of Personal Information	33
10.9	Matters Relating to the SEC	33
10.10	Force Majeure	33
10.11	Successors	34

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SUPPLEMENTAL WARRANT INDENTURE

THIS SUPPLEMENTAL WARRANT INDENTURE is made as of 18th day of March, 2011

AMONG:

GRAN TIERRA ENERGY INC., a corporation formed under the Laws of Nevada (the "Corporation")

- and -

PETROLIFERA PETROLEUM LIMITED, a corporation formed under the laws of Canada ("PPL")

- and -

COMPUTERSHARE TRUST COMPANY OF CANADA, a trust company incorporated under the laws of Canada (the "Warrant Agent")

RECITALS:

WHEREAS PPL and Valiant Trust Company (the "Original Warrant Agent") entered into a warrant indenture (the "Original Indenture") dated August 28, 2009 to provide for the creation and issuance of 32,671,500 warrants in the capital of PPL (the "Original Warrants"), with each Original Warrant entitling the holder thereof to acquire one common share in the capital of PPL upon the payment of $1.20 in lawful money of Canada (the "Original Exercise Price");

AND WHEREAS pursuant to a statutory plan of arrangement in accordance with the Canada Business Corporations Act effective as of March 18, 2011 (the "Arrangement"), among other things, the Corporation acquired, directly or indirectly, the undertaking of PPL as an entirety;

AND WHEREAS the Arrangement provides that each outstanding Original Warrant shall be sold, assigned and transferred to the Corporation in exchange for a number of warrants in the capital of the Corporation (the "Warrants") equal to the product of one multiplied by 0.1241; the exercise price for each such Warrant will be equal to the Original Exercise Price divided by 0.1241 (rounded up to the nearest whole cent); the expiry date of the Warrants will be the same as for the Original Warrants; and the Warrants shall be governed by this Supplemental Indenture;

AND WHEREAS the Corporation, as successor entity, wishes to assume all of the rights, covenants and obligations of PPL under the Original Indenture, as such Original Indenture is amended and restated in this Supplemental Indenture (the "Supplemental Indenture");

AND WHEREAS the Original Warrant Agent has provided PPL with its notice of intention to resign as warrant agent under the Original Indenture and PPL has accepted this notice as being sufficient; The foregoing statements of fact and recitals are made by PPL and not by the Warrant Agent;

AND WHEREAS the Warrant Agent wishes to assume all of the rights, covenants and obligations of the Original Warrant Agent under the Original Indenture, in accordance with the terms thereof;

AND WHEREAS the foregoing recitals are made as representations and statements of fact by the Corporation and PPL and not by the Warrant Agent;

NOW THEREFORE it is hereby covenanted, agreed and declared as follows:

The parties agree as follows.

ARTICLE 1

INTERPRETATION

1.1

Definitions

In this Supplemental Indenture, including the recitals and schedules hereto and in all indentures supplemental hereto:

"Accelerated Expiry Date" has the meaning set forth in Section 2.2;

"Accelerated Time of Expiry" means 5:00 p.m., Calgary time, on the Accelerated Expiry Date;

"Acceleration Notice" has the meaning set forth in Section 2.2;

"Adjustment Period" means the period from and including the Effective Date up to and including the Time of Expiry or the Accelerated Time of Expiry, as applicable;

"affiliate" has the meaning given thereto in the Securities Act (Alberta);

"Arrangement" means the statutory plan of arrangement pursuant to the Canada Business Corporations Act effective March 18, 2011;

"Authorized Investments" means short term interest bearing or discount debt obligations issued or guaranteed by the Government of Canada or a province of Canada;

"Business Day" means a day which is not Saturday or Sunday or a legal holiday in the City of Calgary or a day on which the Warrant Agent is closed for business;

"Closing Trading Price" means the closing trading price on the Toronto Stock Exchange on the Business Day immediately prior to the Exercise Date;

"Common Shares" means fully paid and non-assessable Common Shares of the Corporation as presently constituted;

"Corporation" means Gran Tierra Energy Inc.;

"Corporation's Auditors" means the firm of chartered accountants that is duly appointed as auditors of the Corporation;

"Counsel" means a barrister or solicitor or a firm of barristers and solicitors retained by the Warrant Agent or retained by the Corporation and acceptable to the Warrant Agent;

"Current Market Price" of the Common Shares at any date means the weighted average of the trading prices per share for such shares for any 10 consecutive Trading Days (as selected by the directors of the Corporation) during the period commencing not more than 30 Trading Days before such date on the Toronto Stock Exchange or, if on such date the Common Shares are not listed on the Toronto Stock Exchange, on such stock exchange upon which such shares are listed and as selected by the directors, or, if such shares are not listed on any stock exchange then on such over-the-counter market as may be selected for such purpose by the directors, or, if the Common Shares are not listed on any stock exchange or traded through an over-the-counter market, the Current Market Price is to be determined in good faith by the directors of the Corporation;

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"director" means a director of the Corporation for the time being and, unless otherwise specified herein, reference to action "by the directors" means action by the directors of the Corporation as a board or, whenever duly empowered, action by any committee of such board;

"Dividends Paid in the Ordinary Course" means cash dividends or distributions declared payable on the Common Shares in any fiscal year of the Corporation to the extent that such cash dividends or distributions do not exceed, in the aggregate, 50% of the consolidated net income of the Corporation before extraordinary items for the period of 12 consecutive months ended immediately prior to the first day of such fiscal year (such consolidated net income and extraordinary items to be shown in the audited consolidated financial statements of the Corporation for such period of 12 consecutive months or if there are no audited consolidated financial statements for such period, computed in accordance with generally accepted accounting principles, consistent with those applied in the preparation of the most recent audited consolidated financial statements of the Corporation);

"Effective Date" means the original Issue Date of the Warrants by the Corporation;

"Exercise Date" means, with respect to any Warrant, the date on which the Warrant Certificate representing such Warrant is surrendered for exercise in accordance with the provisions of Article 3;

"Exercise Price" with respect to the exercise of any Warrant means $9.67 in lawful money of Canada per Common Share, unless such price shall have been adjusted in accordance with the provisions of Article 4, in which case it shall mean the adjusted price in effect at such time;

"Expiry Date" means August 28, 2011 subject to adjustment in accordance with Section 2.2.;

"Issue Date" means, in respect of each Warrant, the date of this Supplemental Indenture;

"person" means an individual, body corporate, partnership, trust, trustee, executor, administrator, legal representative or any unincorporated organization;

"SEC" means the United States Securities and Exchange Commission;

"Shareholder" means a holder of record of one or more Common Shares;

"Subsidiary of the Corporation" or "Subsidiary" means any corporation or other person (other than an individual) of which more than 50% of the outstanding voting securities are owned, directly or indirectly, by or for the Corporation, provided that the ownership of such securities confers the right to elect at least a majority of the board of directors (or persons in a similar position of fiduciary responsibility) of such corporation or other person (other than an individual) and includes any entity in like relation to a Subsidiary;

"successor entity" has the meaning set forth in Section 8.2;

"this Warrant Indenture", "this Supplemental Indenture", "herein", "hereby" and similar expressions mean and refer to this amended and restated Supplemental Indenture and any indenture, deed or instrument supplemental hereto; and the expressions "Article", "Section" "subsection" and "paragraph" followed by a number mean and refer to the specified article, section, subsection or paragraph of this Supplemental Indenture;

"Time of Expiry" means 5:00 p.m., Calgary time, on the Expiry Date;

"Trading Day" means a day on which the Toronto Stock Exchange, other stock exchange or over-the-counter market, as the case may be, is open for the transaction of business and on which the Common Shares actually trade on such exchange or market;

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"United States" means the United States of America, its territories and possessions, any State of the United States, and the District of Columbia;

"U.S. Securities Act" means the United States Securities Act of 1933, as amended;

"Warrant Agency" means the principal office of the Warrant Agent in the City of Calgary and the City of Toronto or such other place as may be designated in accordance with subsection 3.1(c);

"Warrant Agent" means Computershare Trust Company of Canada or its successors from time to time in the trust hereby created;

"Warrant Certificate" means a certificate, in substantially the form attached hereto as Schedule "A", issued on or after the Effective Date to evidence Warrants;

"Warrantholder", or "holder" without reference to Common Shares, means the person who is the registered owner of Warrants as shown on the register maintained at the Warrant Agency by the Warrant Agent in accordance with this Supplemental Indenture;

"Warrantholders Request" means an instrument signed in one or more counterparts by Warrantholders representing in the aggregate not less than 10% of the aggregate number all Warrants then outstanding and unexercised, requesting the Warrant Agent to take some action specified therein;

"Warrants" means the Warrants issued and certified hereunder and for the time being outstanding entitling the holder to acquire Common Shares in accordance with this Indenture; and

"written order of the Corporation", "written request of the Corporation", "written consent of the Corporation", "written notice of the Corporation" and "certificate of the Corporation" mean, respectively, a written order, request, consent, notice and certificate signed in the name of the Corporation by any director or officer of the Corporation, and may consist of one or more instruments so executed.

1.2

Gender and Number

Unless herein otherwise expressly provided or unless the context otherwise requires, words importing the singular include the plural and vice versa and words importing gender include all genders.

1.3

Interpretation not Affected by Headings, etc.

The division of this Indenture into Articles and Sections, the provision of a table of contents and the insertion of headings are for convenience of reference only and shall not affect the construction or interpretation of this Indenture.

1.4

Day not a Business Day

In the event that any day on or before which action is required to be taken hereunder is not a Business Day, then such action shall be required to be taken at or before the requisite time on the next succeeding day that is a Business Day.

1.5

Time of the Essence

Time shall be of the essence in this Indenture.

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1.6

Applicable Law

This Supplemental Indenture and the Warrant Certificates shall be construed in accordance with the laws of the Province of Alberta and shall be treated in all respects as Alberta contracts. The parties hereby submit and attorn to the jurisdiction of the courts of Alberta for all matters related to this Supplemental Indenture and the Warrant Certificates.

1.7

Severability

In the event that any provision under this Supplemental Indenture is determined to be invalid or unenforceable in any respect, such determination will not affect the provision in any other respect or any other provision under this Indenture, all of which will remain in full force and effect.

1.8

Conflicts

In the event there is any conflict between this Indenture and any Warrant Certificate, the provisions under this Indenture will govern and prevail.

1.9

Supersedes Original Indenture

From and after the date hereof, the rights, obligations, terms and conditions set out in the Original Indenture have been superseded, amended and replaced by this Supplemental Indenture.

ARTICLE 2

ISSUE OF WARRANTS

2.1

Issue of Warrants

In connection with the Arrangement, 4,125,036 Warrants are hereby created and authorized to be issued in accordance with the terms hereof and shall be executed by the Corporation and certified by or on behalf of the Warrant Agent upon the written order of the Corporation and delivered by the Warrant Agent to the Corporation in accordance with the written direction of the Corporation. Each Warrant shall be nominally denominated as the right, upon exercise and with the payment of the Exercise Price, to acquire one Common Share, subject to adjustment in accordance with Article 4, at any time after the Issue Date and ending at the Time of Expiry or Accelerated Time of Expiry, as the case may be; provided, however, that notwithstanding anything to the contrary set forth herein, Warrants shall not be exercisable by payment of the Exercise Price, but and may only be exercised by "net exercise", such that, upon exercise, the holder thereof shall acquire a fraction of a Common Share (subject to Sections 2.3(c) and 3.3(b)) as is equal to:

Fraction = (A – B)/A

For purposes of the foregoing formula:

the Closing Trading Price.

the Exercise Price.

2.2

Acceleration of Expiry Date

Subject to adjustment in accordance with Article 4, at any time after the Issue Date and ending at the Time of Expiry, if the 20 trading day volume weighted average price of the Common Shares on the Toronto Stock Exchange (or such other stock exchange or quotation system on which the Corporation's shares are listed and where a majority of the trading volume occurs), exceeds $20.15, the Corporation may, within five Business Days after such an event, provide notice (the "Acceleration Notice") to the Warrantholders advising that the Warrants will expire on the Accelerated Time of Expiry on the date which is 30 days after the date of the Acceleration Notice (the "Accelerated Expiry Date") if not exercised prior to the Accelerated Time of Expiry.

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2.3

Form and Terms of Warrants

(a)

The Warrant Certificates (including all replacements issued in accordance with this Indenture) shall be substantially in the form set out in Schedule "A" hereto, shall bear such legends and distinguishing letters and numbers as the Corporation may, with the approval of the Warrant Agent, prescribe, and shall be issuable in any denomination excluding fractions.

(b)

The Warrant Certificates may be engraved, printed, lithographed or in other form or partly in one form and partly in another as the Corporation with the approval of the Warrant Agent may determine. No change in the Warrant Certificate shall be required by reason of any adjustment made pursuant to Article 4 in the number or class of Common Shares or other securities to which a holder is entitled pursuant to the exercise of the Warrants or by reason of any acceleration made pursuant to Section 2.2 to the date the Warrants expire.

(c)

No fractional Warrants shall be issued or otherwise provided for hereunder. Any fractional interests in Common Shares of a Warrantholder will be aggregated to form whole numbers of Common Shares with any remaining fractional interests rounded down to the nearest whole Common Share. Cash will be paid in lieu of any fractional share entitlement based on the Current Market Price of the Common Shares, provided that the Corporation shall not be required to make any such cash payment that is less than $10.00.

(d)

The number of Common Shares which may be received pursuant to the exercise of Warrants in accordance with the terms and conditions of this Supplemental Indenture shall be adjusted in the events and in the manner specified in Article 4.

(e)

Each Warrant shall entitle the holder thereof to such other rights and privileges as are set forth in this Supplemental Indenture.

2.4

Warrantholder not a Shareholder

Nothing in this Supplemental Indenture or in the holding of a Warrant or Warrant Certificate or otherwise, shall, in itself, confer or be construed as conferring upon a Warrantholder any right or interest whatsoever as a Shareholder or as any other shareholder of the Corporation, including, but not limited to, the right to vote at, to receive notice of, or to attend, meetings of Shareholders or any other proceedings of the Corporation, or the right to receive dividends and other distributions except as may be provided in this Supplemental Indenture or the Warrant Certificates.

2.5

Warrants to Rank pari passu

All Warrants shall rank pari passu, whatever may be the actual Issue Date thereof.

2.6

Signing of Warrant Certificates

The Warrant Certificates shall be signed by any one director or officer of the Corporation. The signature of any such director or officer may be mechanically reproduced in facsimile and Warrant Certificates bearing such facsimile signature shall be binding upon the Corporation as if it had been manually signed by such director or officer. Notwithstanding that any of the persons whose manual or facsimile signature appears on any Warrant Certificate as a director or officer may no longer be appointed or hold office at the date of such Warrant Certificate or at the date of certification or delivery thereof, any Warrant Certificate signed as aforesaid shall, subject to Section 2.7, be valid and binding upon the Corporation and the holder thereof shall be entitled to the benefits of this Supplemental Indenture.

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2.7

Certification by the Warrant Agent

(a)

No Warrant Certificate shall be issued or, if issued, shall be valid for any purpose or entitle the holder to the benefit hereof until it has been certified by manual signature by or on behalf of the Warrant Agent and such certification by the Warrant Agent upon any Warrant Certificate shall be conclusive evidence as against the Corporation that the Warrant Certificate so certified has been duly issued hereunder and that the holder is entitled to the benefits hereof.

(b)

The certification of the Warrant Agent on Warrant Certificates issued hereunder shall not be construed as a representation or warranty by the Warrant Agent as to the validity of this Supplemental Indenture or the Warrant Certificates (except the due certification thereof) and the Warrant Agent shall in no respect be liable or answerable for the use made of the Warrant Certificate or any of them or of the consideration therefor except as otherwise specified herein. The countersignature of the Warrant Agent will, however, be a representation and warranty of the Warrant Agent that the Warrant Certificate has been duly countersigned by or on behalf of the Warrant Agent pursuant to the provisions of this Supplemental Indenture.

2.8

Issue in Substitution for Warrant Certificates Lost, etc.

(a)

In the event that any Warrant Certificate shall become mutilated or be lost, destroyed or stolen, the Corporation, subject to applicable law, shall issue and thereupon the Warrant Agent shall certify and deliver, a new Warrant Certificate of like tenor as the one mutilated, lost, destroyed or stolen in exchange for and in place of and upon cancellation of such mutilated Warrant Certificate, or in lieu of and in substitution for such lost, destroyed or stolen Warrant Certificate, and the substituted Warrant Certificate shall be in a form approved by the Warrant Agent and the Warrants evidenced thereby shall be entitled to the benefits hereof and shall rank equally in accordance with its terms with all other Warrants issued or to be issued hereunder.

(b)

The applicant for the issue of a new Warrant Certificate pursuant to this Section 2.8 shall bear the cost of the issue thereof and in case of loss, destruction or theft shall, as a condition precedent to the issue thereof, furnish to the Corporation and to the Warrant Agent such evidence of ownership and of the loss, destruction or theft of the Warrant Certificate so lost destroyed or stolen as shall be satisfactory to the Corporation and to the Warrant Agent each in their sole discretion, and such applicant shall also be required to furnish an indemnity and surety bond in amount and form satisfactory to the Corporation and the Warrant Agent each in their discretion and shall pay the reasonable charges of the Corporation and the Warrant Agent in connection therewith.

2.9

Exchange of Warrant Certificates

(a)

Warrant Certificates representing Warrants to acquire any specified number of Common Shares may, upon compliance with the reasonable requirements of the Warrant Agent, be exchanged for another Warrant Certificate or Warrant Certificates entitling the holder thereto to acquire in the aggregate the same number of Common Shares as may be acquired under the Warrant Certificate or Warrant Certificates so exchanged. Upon compliance with the reasonable requirements of the Warrant Agent and the terms and conditions hereof, the Corporation will sign, and the Warrant Agent will countersign, all Warrant Certificates necessary to carry out these exchanges.

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(b)

Warrant Certificates may be exchanged only at a Warrant Agency or at any other place that is designated by the Corporation with the approval of the Warrant Agent. Any Warrant Certificate tendered for exchange shall be cancelled by the Warrant Agent.

2.10

Transfer of Warrants

(a)

Subject to subsection 2.10(b) below and such reasonable requirements as the Warrant Agent may prescribe and all applicable securities legislation and requirements of regulatory authorities, the Warrants may be transferred on the register kept at the Warrant Agency by the Warrantholder (or its legal representatives or its attorney duly appointed by an instrument in writing in form and manner of execution satisfactory to the Warrant Agent) only upon the surrender of the relevant Warrant Certificate with the transfer form forming part thereof duly completed and signed. After receiving the surrendered Warrant Certificate(s) and upon the person surrendering the same meeting the requirements set forth above, the Warrant Agent shall issue to the transferee a Warrant Certificate representing the Warrants transferred.

(b)

No transfer of a Warrant shall be valid: (i) unless made in accordance with the provisions hereof; (ii) until, upon compliance with such reasonable requirements as the Warrant Agent may prescribe, such transfer is recorded on the register maintained by the Warrant Agent pursuant to Section 2.12; (iii) unless such registration shall be noted on the Warrant Certificate by the Warrant Agent; and (iv) until all governmental or other charges arising by reason of such transfer have been paid.

2.11

Charges for Exchange and Transfer

Except as otherwise herein provided, the Warrant Agent may charge to the holder requesting an exchange or transfer a reasonable sum for each new Warrant Certificate issued in exchange for Warrant Certificate(s), and payment of such charges and reimbursement of the Warrant Agent or the Corporation for any and all stamp taxes or governmental or other charges required to be paid shall be made by such holder as a condition precedent to such exchange or transfer.

2.12

Registration of Warrants

The Warrant Agent shall keep at the Warrant Agency: (i) a register of Warrantholders in which shall be entered in alphabetical order the names and addresses of the holders of Warrants and particulars of the Warrants held by them; and (ii) a register of transfers in which all transfers of Warrants and the date and other particulars of each transfer shall be entered. Branch registers shall also be kept at such other place or places, if any, as the Corporation, with the approval of the Warrant Agent, may designate. Such registers will at all reasonable times be open for inspection by the Corporation and/or any Warrantholder.

2.13

Transferee Entitled to Registration

The transferee of a Warrant shall, after the transfer form attached to the Warrant Certificate is duly completed and the Warrant Certificate and form of transfer are lodged with the Warrant Agent, and upon compliance with all other conditions in that regard required by this Supplemental Indenture and by all applicable securities legislation and requirements of regulatory authorities, be entitled to have his name entered on the register as the owner of such Warrant free from all equities or rights of set off or counterclaim between the Corporation and his transferor or any previous Warrantholder of such Warrant, save in respect of equities of which the Corporation or the transferee is required to take notice by statute or by order of a court of competent jurisdiction.

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2.14

Registers Open for Inspection

The registers hereinbefore referred to shall be open at the office of the Warrant Agent during normal business hours on each Business Day and upon reasonable written notice for inspection by the Corporation, the Warrant Agent or any Warrantholder. The Warrant Agent shall, from time to time when requested to do so by the Corporation, furnish the Corporation with a list of the names and addresses of Warrantholders entered in the register kept by the Warrant Agent showing the number of Warrants and the number of Common Shares which may then be acquired upon the exercise of the Warrants held by each such Warrantholder.

2.15

Ownership of Warrants

(a)

The Corporation and the Warrant Agent may deem and treat the registered Warrantholder of any Warrant Certificate as the absolute owner of the Warrant represented thereby for all purposes, and the Corporation and the Warrant Agent shall not be affected by any notice or knowledge to the contrary, except where the Corporation or the Warrant Agent is required to take notice by statute or by order of a court of competent jurisdiction. For greater certainty, subject to applicable law, neither the Corporation nor the Warrant Agent will be bound to take notice of or see to the execution of any trust, whether express, implied or constructive, in respect of any Warrant, and may transfer any Warrant on the direction of the person registered as Warrantholder thereof, whether named as trustee or otherwise, as though that person were the beneficial owner thereof.

(b)

Subject to the provisions of this Supplemental Indenture and applicable law, each Warrantholder shall be entitled to the rights and privileges attaching to the Warrants held thereby. The exercise of the Warrants in accordance with the terms hereof and the receipt by any such Warrantholder of Common Shares pursuant thereto shall be a good discharge to the Corporation and the Warrant Agent with respect to such Warrants and neither the Corporation nor the Warrant Agent shall be bound to inquire into the title of any such holder.

ARTICLE 3

EXERCISE OF WARRANTS

3.1

Method of Exercise of Warrants

(a)

The holder of any Warrant may exercise the right evidenced thereby conferred on such holder to acquire Common Shares by surrendering, prior to the Time of Expiry or the Accelerated Time of Expiry, as applicable, to the Warrant Agent at a Warrant Agency the Warrant Certificate representing such Warrant, with a duly completed and executed exercise form in the form attached to the Warrant Certificate. Promptly upon the receipt of a duly completed and executed exercise form, the Warrant Agent will deliver a notice to the Corporation of the exercise and the Corporation will provide the Warrant Agent with confirmation of the number of Common Shares to be issued in accordance with Section 2.1

(b)

Any exercise form referred to in subsection 3.1(a) shall be signed by the Warrantholder or his executors, administrators or other legal representatives or his attorney duly appointed (such persons being obligated to provide the Warrant Agent at the Warrant Agency with proof satisfactory to the Warrant Agent of his or her authority to act on behalf of the Warrantholder) and shall specify:

(i)

the number of Warrants which the holder wishes to exercise (being not more than those which are represented by the Warrant Certificate(s) surrendered);

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(ii)

the person or persons in whose name or names such Common Shares are to be issued, and if such persons are individuals, the relevant social insurance numbers;

(iii)

the address or addresses of such person or persons; and

(iv)

the number of Warrants to be exercised by each such person if more than one is so specified.

If any of the Common Shares subscribed for are to be issued to a person or persons other than the Warrantholder, the Warrantholder shall pay to the Corporation or the Warrant Agent on behalf of the Corporation, all applicable transfer or similar taxes and the Corporation shall not be required to issue or deliver certificates evidencing Common Shares unless or until such Warrantholder shall have paid to the Corporation, or the Warrant Agent on behalf of the Corporation, the amount of such tax or shall have established to the satisfaction of the Corporation that such tax has been paid or that none is due.

(c)

In connection with the exchange of Warrant Certificates and exercise of Warrants and compliance with such other terms and conditions hereof as may be required, the Corporation has appointed the principal office of the Warrant Agent in Calgary and Toronto as an agency at which Warrant Certificates may be surrendered for exchange or at which Warrants may be exercised and the Warrant Agent has accepted such appointment. The Corporation shall give notice to the Warrant Agent of any change of the Warrant Agency.

3.2

Effect of Exercise of Warrants

(a)

Upon compliance by the holder of any Warrant Certificate with the provisions of Section 3.1, and subject to Section 3.3, the Common Shares issuable pursuant to the exercise of such Warrants shall be deemed to have been issued as fully paid and non-assessable and the person or persons to whom such Common Shares are to be issued shall be deemed to have become the holder or holders of record of such Common Shares on the Exercise Date unless the transfer registers of the Corporation shall be closed on such date, in which case the Common Shares subscribed for shall be deemed to have been issued and such person or persons shall be deemed to have become the holder or holders of record of such Common Shares, on the date on which such transfer registers are reopened.

(b)

Within five Business Days after the Exercise Date of a Warrant as set forth above, the Warrant Agent shall cause to be mailed to the person or persons in whose name or names the Common Shares have been issued, as specified in the exercise form completed in connection with the exercise of the Warrants, at the address specified in such exercise form or, if so specified in such exercise form, cause to be delivered to such person or persons at the Warrant Agency where the Warrant Certificate was surrendered, a certificate or certificates for the appropriate number of Common Shares subscribed for.

3.3

Partial Exercise of Warrants; Fractions

(a)

The holder of any Warrants may acquire a number of Common Shares less than the number which the holder is entitled to acquire pursuant to the surrendered Warrant Certificate(s). In the event of any exercise of a number of Warrants less than the number which the holder is entitled to exercise, the holder of the Warrants upon exercise thereof shall, in addition, be entitled to receive without charge therefor, a new Warrant Certificate(s) in respect of the balance of the Warrants which such holder was entitled to exercise pursuant to the surrendered Warrant Certificate(s) and which were not then exercised.

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(b)

Notwithstanding anything herein contained including any adjustment provided for in Article 4, the Corporation shall not be required, upon the exercise of any Warrants, to issue fractions of Common Shares or to distribute certificates which evidence fractional Common Shares. In lieu of fractional Common Shares, the Corporation shall pay to the holder who would otherwise be entitled to receive fractional Common Shares upon an exercise of Warrants, within 10 Business Days after the date upon which the fractional Common Shares would have been issued, an amount in lawful money of Canada equal to the Current Market Price of the Common Shares as of the Exercise Date multiplied by an amount equal to the fractional interest of Common Shares such holder would otherwise be entitled to receive upon such exercise, provided that the Corporation shall not be required to make any payment, calculated as aforesaid, that is less than $10.00. The price to be paid shall be provided by the Corporation in writing to the Warrant Agent upon request.

3.4

Expiration of Warrants

Immediately after the Time of Expiry or the Accelerated Time of Expiry, as applicable, all rights under any Warrant in respect of which the right of acquisition herein and therein provided for shall not have been exercised shall cease and terminate and such Warrant shall be void and of no further force or effect.

3.5

Cancellation of Surrendered Warrants

All Warrant Certificates surrendered to the Warrant Agent pursuant to Sections 2.8, 2.9, 2.10, 3.1, 3.3 and 5.1 shall be cancelled by the Warrant Agent and, after the expiry of any period of retention prescribed by law, destroyed by the Warrant Agent and, upon written request by the Corporation, the Warrant Agent shall furnish to the Corporation a destruction certificate identifying the Warrant Certificates so destroyed, the number of Warrants evidenced thereby and the number of Common Shares which could have been purchased pursuant thereto.

3.6

Accounting and Recording

(a)

The Warrant Agent shall as soon as reasonably practicable account to the Corporation with respect to Warrants exercised. Any monies, securities or other instruments, from time to time received by the Warrant Agent pursuant to the exercise of Warrants shall be received in trust for and shall be segregated and kept apart by the Warrant Agent in trust for the Corporation.

(b)

The Warrant Agent shall record the particulars of any Warrants exercised, which shall include the names and addresses of the persons who become holders of Common Shares on exercise and the Exercise Date. Within five Business Days of each Exercise Date, the Warrant Agent shall provide such particulars in writing to the Corporation.

3.7

Common Share Certificates

Notwithstanding anything herein contained, Common Shares will only be issued pursuant to the exercise of the Warrants in compliance with applicable securities laws of any jurisdiction. At the instruction of the Corporation, Common Shares issued in connection with the exercise of the Warrants may bear such legends as may be required by applicable securities regulatory requirements, authorities or stock exchanges.

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ARTICLE 4

ADJUSTMENT OF NUMBER OF COMMON SHARES

4.1

Adjustment of Number of Common Shares

The acquisition rights, as they relate to Common Shares, attaching to the Warrants in effect at any date, and the Exercise Price in respect thereof, shall be subject to adjustment from time to time as follows:

(a)

If and whenever at any time during the Adjustment Period, the Corporation shall:

(i)

subdivide, redivide or change outstanding Common Shares into a greater number of shares,

(ii)

reduce, combine or consolidate the outstanding Common Shares into a smaller number of shares, or

(iii)

issue Common Shares or securities exchangeable for or convertible into Common Shares at no additional cost to the holders of all or substantially all of the outstanding Common Shares by way of a stock dividend or other distribution (other than the issue of Common Shares to holders of Common Shares pursuant to their exercise of options to receive dividends in the form of Common Shares in lieu of Dividends Paid in the Ordinary Course on the Common Shares),

(any of such events in these clauses (i), (ii) and (iii) being called a "Common Share Reorganization"), then effective immediately after the record date at which the holders of Common Shares are determined for the purposes of the Common Share Reorganization, the Exercise Price shall be adjusted by multiplying the Exercise Price in effect immediately prior to such record date by a fraction, the numerator of which shall be the number of Common Shares outstanding on such record date before giving effect to such Common Share Reorganization and the denominator of which shall be the number of Common Shares outstanding after giving effect to such Common Share Reorganization (including, in the case where securities exchangeable for or convertible into Common Shares at no additional cost are distributed, the number of Common Shares that would have been outstanding had such securities been exchanged for or converted into Common Shares on such record date). Upon any adjustment to the Exercise Price pursuant to this subsection 4.1(a), the number of Common Shares subject to the right of purchase under each Warrant shall be contemporaneously adjusted by multiplying the number of Common Shares which theretofore may have been purchased under such Warrant by a fraction of which the numerator shall be the respective Exercise Price in effect immediately prior to such adjustment and the denominator shall be the respective Exercise Price resulting from such adjustment.

(b)

If and whenever at any time during the Adjustment Period, the Corporation shall fix a record date for the issuance of rights, options or warrants to all or substantially all the holders of its outstanding Common Shares entitling them, for a period expiring not more than 45 days after such record date, to subscribe for or purchase Common Shares (or securities convertible or exchangeable into Common Shares) at a price per share (or having a conversion or exchange price per share) less than 95% of the Current Market Price of a Common Share on such record date, the Exercise Price shall be adjusted immediately after such record date so that it shall equal the amount determined by multiplying the Exercise Price in effect on such record date by a fraction of which the numerator shall be the total number of Common Shares outstanding on such record date plus a number of Common Shares equal to the number arrived at by dividing the aggregate price of the total number of additional Common Shares offered for subscription or purchase (or the aggregate conversion or exchange price of the convertible or exchangeable securities so offered) by such Current Market Price, and of which the denominator shall be the total number of Common Shares outstanding on such record date plus the total number of additional Common Shares offered for subscription or purchase or into which the convertible or exchangeable securities so offered are convertible or exchangeable; any Common Shares owned by or held for the account of the Corporation or any Subsidiary shall be deemed not to be outstanding for the purpose of any such computation; such adjustment shall be made successively whenever such a record date is fixed; to the extent that any such rights, options or warrants are not exercised prior to the expiration thereof, the Exercise Price shall be readjusted to the Exercise Price which would then be in effect if such record date had not been fixed or to the Exercise Price which would then be in effect based upon the number of Common Shares (or securities convertible or exchangeable into Common Shares) actually issued upon the exercise of such rights, options or warrants, as the case may be.

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(c)

If and whenever at any time during the Adjustment Period, the Corporation shall fix a record date for the making of a distribution to all or substantially all the holders of its outstanding Common Shares of (i) securities of any class, whether of the Corporation or any other person (other than Common Shares and other than securities distributed to holders of Common Shares pursuant to their exercise of options to receive dividends in the form of such securities in lieu of Dividends Paid in the Ordinary Course on the Common Shares), (ii) rights, options or warrants (excluding those referred to in subsection 4.1(b)), (iii) evidences of its indebtedness or (iv) assets (excluding Dividends Paid in the Ordinary Course) then, in each such case, the Exercise Price shall be adjusted immediately after such record date so that it shall equal the price determined by multiplying the Exercise Price in effect on such record date by a fraction, of which the numerator shall be the total number of Common Shares outstanding on such record date multiplied by the Current Market Price of a Common Share on such record date, less the aggregate fair market value (as determined by the directors, which determination shall be conclusive) of such securities shares, rights, options, warrants, evidences of indebtedness or assets so distributed, and of which the denominator shall be the total number of Common Shares outstanding on such record date multiplied by such Current Market Price; any Common Shares owned by or held for the account of the Corporation or any Subsidiary shall be deemed not to be outstanding for the purpose of any such computation; such adjustment shall be made successively whenever such a record date is fixed; to the extent that such distribution is not so made, the Exercise Price shall be readjusted to the Exercise Price which would then be in effect if such record date had not been fixed or to the Exercise Price which would then be in effect based upon such shares or rights, options or warrants or evidences of indebtedness or assets actually distributed, as the case may be; in clause (iv) of this subsection 4.1(c) the term "Dividends Paid in the Ordinary Course" shall include the value of any securities or other property or assets distributed in lieu of cash Dividends Paid in the Ordinary Course at the option of Shareholders.

(d)

If and whenever at any time during the Adjustment Period, there is a reclassification of the Common Shares or a capital reorganization of the Corporation (other than as described in subsection 4.1(a)) or a consolidation, amalgamation, arrangement or merger of the Corporation with or into any other body corporate, trust, partnership or other entity (other than a consolidation, amalgamation, arrangement or merger which does not result in any reclassification of the outstanding Common Shares or a change of the Common Shares into other securities), or a sale or conveyance of the property and assets of the Corporation as an entirety or substantially as an entirety to any other body corporate, trust, partnership or other entity or a liquidation, dissolution or winding up of the Corporation (any of such events being hereinafter called a "Capital Reorganization"), any Warrantholder who has not exercised its right of acquisition prior to the effective date of such Capital Reorganization, upon the exercise of such right thereafter, shall be entitled to receive and shall accept, in lieu of the number of Common Shares then sought to be acquired by it, the number of shares or other securities or property of the Corporation or of the body corporate, trust, partnership or other entity resulting from such Capital Reorganization, or of the parent entity of such resulting entity, or of such entity to which such sale or conveyance has been made, as the case may be, that such Warrantholder would have been entitled to receive on such Capital Reorganization, if, on the record date or the effective date thereof, as the case may be, the Warrantholder had been the registered holder of the number of Common Shares sought to be acquired by it and to which it was entitled to acquire upon exercise of the Warrants. If determined appropriate by the Warrant Agent to give effect to or to evidence the provisions of this subsection 4.1(d), the Corporation, its successor, or such purchasing body corporate, partnership, trust or other entity, as the case may be, shall, prior to or contemporaneously with any such Capital Reorganization, enter into an indenture which shall provide, to the extent possible, for the application of the provisions set forth in this Supplemental Indenture with respect to the rights and interests thereafter of the Warrantholders to the end that the provisions set forth in this Supplemental Indenture shall thereafter correspondingly be made applicable, as nearly as may reasonably be, with respect to any shares, other securities or property to which a Warrantholder is entitled on exercise of its acquisition rights thereafter. Any indenture entered into between the Corporation and the Warrant Agent pursuant to the provisions of this subsection 4.1(d) shall be a supplemental indenture entered into pursuant to the provisions of Article 8. Any indenture entered into between the Corporation, any successor to the Corporation or such purchasing body corporate, partnership, trust or other entity and the Warrant Agent shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided in this Section 4.1 and which shall apply to successive Capital Reorganizations.

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(e)

In any case in which this Section 4.1 shall require that an adjustment shall become effective immediately after a record date for an event referred to herein, the Corporation may defer, until the occurrence of such event, issuing to the holder of any Warrant exercised after such record date and before the occurrence of such event the additional Common Shares or other securities or property issuable upon such exercise by reason of the adjustment required by such event; provided, however, that the Corporation shall deliver to such holder an appropriate instrument evidencing such holder's right to receive such additional Common Shares or other securities or property upon the occurrence of the event requiring such adjustment and the right to receive any distributions made on such additional Common Shares or other securities or property declared in favour of holders of record of Common Shares or such other securities or property on and after the relevant date of exercise or such later date as such holder would, but for the provisions of this subsection 4.1(e), have become the holder of record of such additional Common Shares or other securities or property pursuant to this Section 4.1.

(f)

In any case in which subsections 4.1(a), 4.1(b) or 4.1(c) require that an adjustment be made to the Exercise Price, no such adjustment shall be made if, the holders of the outstanding Warrants receive the Common Shares or securities exchangeable for or convertible into Common Shares referred to in subsection 4.1(a), the rights, options or warrants referred to in subsection 4.1(b) or the securities, rights, options, warrants, evidences of indebtedness or assets referred to in subsection 4.1(c), as the case may be, in such kind and number as they would have received if they had been holders of Common Shares on the applicable record date or effective date, as the case may be, by virtue of their outstanding Warrant having then been exercised into Common Shares at the Exercise Price in effect on the applicable record or effective date, as the case may be.

(g)

The adjustments provided for in this Section 4.1 are cumulative and shall, in the case of adjustments to the Exercise Price, be computed to the nearest whole cent and shall apply to successive subdivisions, redivisions, reductions, combinations, consolidations, distributions, issues or other events resulting in any adjustment under the provisions of this Section 4.1, provided that, notwithstanding any other provision of this Section, no adjustment of the Exercise Price shall be required unless such adjustment would require an increase or decrease of at least 1% in the Exercise Price then in effect or a change in the number of Common Shares purchasable upon exercise by at least one one-hundredth of a Common Share, as the case may be; provided, however, that any adjustments which by reason of this subsection 4.1(g) are not required to be made shall be carried forward and taken into account in any subsequent adjustment.

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(h)

After any adjustment pursuant to this Section 4.1, the term "Common Shares" where used in this Supplemental Indenture shall be interpreted to mean securities of any class or classes which, as a result of such adjustment and all prior adjustments pursuant to this Section 4.1, the Warrantholder is entitled to receive upon the exercise of such holder's Warrant and the number of Common Shares indicated by any exercise made pursuant to a Warrant shall be interpreted to mean the number of Common Shares or other property or securities a Warrantholder is entitled to receive, as a result of such adjustment and all prior adjustments pursuant to this Section 4.1, upon the full exercise of a Warrant.

4.2

Entitlement to Shares on Exercise of Warrant

All shares of any class or other securities or property which a Warrantholder is at the time in question entitled to receive on the exercise of its Warrant, whether or not as a result of adjustments made pursuant to this Article 4, shall, for the purposes of the interpretation of this Supplemental Indenture, be deemed to be shares which such Warrantholder is entitled to acquire pursuant to such Warrant.

4.3

No Adjustment for Stock Options or Warrants

Anything in this Article 4 to the contrary notwithstanding, no adjustment shall be made in the acquisition rights attached to the Warrants if the issue of Common Shares is being made pursuant to this Supplemental Indenture, pursuant to any stock option, stock purchase, stock appreciation rights or other employee compensation plan in force from time to time for directors, officers, employees or consultants of the Corporation or any of its Subsidiaries, as the case may be, or pursuant to any option, right or warrant outstanding immediately prior to the Effective Date.

4.4

Determination by Corporation's Auditors

In the event of any question arising with respect to the adjustments provided for in this Article 4, such question shall be conclusively determined by the Corporation's Auditors or if they are unable or unwilling to act, by such other firm of independent chartered accountants as may be selected by the Corporation. Such auditors or accountants shall have access to all necessary records of the Corporation, and such determination shall be binding upon the Corporation, the Warrant Agent, all Warrantholders and all other persons interested therein (absent manifest error).

4.5

Proceedings Prior to any Action Requiring Adjustment

As a condition precedent to the taking of any action which would require an adjustment in any of the acquisition rights pursuant to any of the Warrants, including the number of Common Shares which are to be received upon the exercise thereof, the Corporation shall take any corporate action which may, in the opinion of Counsel, be necessary in order that the Corporation has sufficient unissued and reserved shares in its authorized capital and may validly and legally issue as fully paid and non-assessable all the Common Shares or other securities or property which the holders of such Warrants are entitled to receive on the full exercise thereof in accordance with the provisions hereof.

4.6

Certificate of Adjustment

The Corporation shall from time to time immediately after the occurrence of any event which requires an adjustment or readjustment as provided in this Article 4, deliver a certificate of the Corporation to the Warrant Agent specifying the nature of the event requiring the same and the amount of the adjustment necessitated thereby and setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based, which certificate and the amount of the adjustment shall, if requested by the Warrant Agent, be supported by a certificate of the Corporation's Auditors verifying such calculation. When so verified, the Warrant Agent shall forthwith give notice, supplied by the Corporation and at the Corporation's expense, to the Warrantholders specifying the event requiring such adjustment or readjustment and the results thereof including the resulting Exercise Price; provided that, if the Corporation has given notice under Section 4.7 covering all the relevant facts in respect of such event, no such notice to the Warrantholders need be given under this Section 4.6. Any certificate of the Corporation delivered pursuant to this Section 4.6 and the results of the adjustment specified therein shall, subject to the provisions of Section 4.4 and absent manifest error, be conclusive and binding on all Warrantholders.

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4.7

Notice of Special Matters

The Corporation covenants with the Warrant Agent that, so long as any Warrant remains outstanding, it will give notice to the Warrant Agent and to the Warrantholders of its intention to fix the record date for any event referred to in subsections 4.1(a), (b), (c) or (d) which may give rise to an adjustment of the Exercise Price. Such notice shall specify the particulars of such event and the record date for such event, provided that the Corporation shall only be required to specify in the notice such particulars of the event as shall have been fixed and determined on the date on which the notice is given. The notice shall be given in each case not less than 10 Business Days prior to such applicable record date.

4.8

No Action after Notice

The Corporation covenants with the Warrant Agent that it will not close its transfer books or take any other corporate action which might deprive the holder of a Warrant of the opportunity to exercise its right of acquisition pursuant thereto during the period of 10 Business Days after the giving of the certificate or notices set forth in Sections 4.6 and 4.7.

4.9

Protection of Warrant Agent

Except as provided in Section 9.2, the Warrant Agent:

(a)

shall be entitled to act and rely on any adjustment calculation of the Corporation or the Corporation's Auditors;

(b)

shall not at any time be under any duty or responsibility to any Warrantholder to determine whether any facts exist which may require any adjustment contemplated by Section 4.1, or with respect to the nature or extent of any such adjustment when made, or with respect to the method employed in making the same;

(c)

shall not be accountable with respect to the validity or value (or the kind or amount) of any Common Shares or of any shares or other securities or property which may at any time be issued or delivered upon the exercise of the rights attaching to any Warrant;

(d)

shall not be responsible for any failure of the Corporation to issue, transfer or deliver Common Shares or certificates for the same upon the surrender of any Warrants for the purpose of the exercise of such rights or to comply with any of the covenants contained in this Article 4; and

(e)

shall not incur any liability or responsibility whatsoever or be in any way responsible for the consequences of any breach on the part of the Corporation of any of the representations, warranties or covenants herein contained.

4.10

Other Adjustments

In case the Corporation after the date hereof shall take any action affecting the Common Shares, other than an action otherwise described in this Article 4 which in the opinion of the directors would have a material adverse effect on the rights of Warrantholders, the Exercise Price and/or the number and/or kind of Common Shares purchasable upon exercise, there shall be an adjustment in such manner, if any, and at such time, by action by the directors of the Corporation subject to the prior consent of the Toronto Stock Exchange or other stock exchange, if applicable. Failure of the taking of action by the directors of the Corporation so as to provide for an adjustment prior to the effective date of any action by the Corporation affecting the Common Shares shall be conclusive evidence that the directors have determined, acting reasonably and in good faith, that it is equitable to make no adjustment in the circumstances.

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ARTICLE 5

RIGHTS AND COVENANTS OF THE CORPORATION

5.1

Optional Purchases by the Corporation

The Corporation may from time to time purchase by private contract, in the open market, on any stock exchange or otherwise any of the Warrants. Any such purchase shall be made at the lowest price or prices at which, in the opinion of the directors, such Warrants are then obtainable, plus reasonable costs of purchase, and may be made in such manner, from such persons and on such other terms as the Corporation, in its sole discretion, may determine subject to compliance with all applicable laws. Any Warrant Certificates representing the Warrants purchased pursuant to this Section 5.1 shall forthwith be delivered to and cancelled by the Warrant Agent. No Warrants shall be issued in replacement thereof.

5.2

General Covenants

The Corporation covenants with the Warrant Agent that so long as any Warrants remain outstanding:

(a)

the Warrants, when issued and countersigned as provided in this Supplemental Indenture, will be valid and binding obligations enforceable against it in accordance with and subject to the provisions of this Supplemental Indenture;

(b)

it will reserve and keep available a sufficient number of Common Shares for the purpose of enabling it to satisfy its obligations to issue Common Shares upon exercise of the Warrants;

(c)

it will cause the Common Shares and the certificates representing the Common Shares from time to time acquired pursuant to the exercise of the Warrants to be duly issued and delivered in accordance with the Warrant Certificates and the terms hereof;

(d)

all Common Shares which shall be issued upon exercise of the right to acquire provided for herein and in the Warrant Certificates shall be fully paid and non-assessable;

(e)

the Corporation will do, or cause to be done, all things necessary to preserve and keep in full force and effect its corporate existence, provided however that (subject to Article 4 and Section 8.2) nothing will prevent the amalgamation, consolidation, merger or sale of, or other business combination involving, the Corporation;

(f)

it will perform and carry out all of the acts or things to be done by it as provided in this Supplemental Indenture; and

(g)

it will execute, acknowledge and deliver or cause to be done, executed, acknowledged and delivered, all other acts, deeds and assurances in law as the Warrant Agent may reasonably require for the better accomplishing and effecting the intentions and provisions of this Supplemental Indenture.

5.3

Warrant Agent's Remuneration and Expenses

The Corporation covenants that it will pay to the Warrant Agent from time to time reasonable remuneration for its services hereunder and will pay or reimburse the Warrant Agent upon its request for all reasonable expenses, disbursements and advances incurred or made by the Warrant Agent in the administration or execution of the trusts hereby created (including the reasonable compensation and the disbursements of Counsel and all other advisers and assistants not regularly in its employ) both before any default hereunder and thereafter until all duties of the Warrant Agent hereunder shall be finally and fully performed, except any such expense, disbursement or advance as may arise out of or result from the Warrant Agent's gross negligence, wilful misconduct or bad faith.

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5.4

Performance of Covenants by Warrant Agent

If the Corporation shall fail to perform any of its covenants contained in this Supplemental Indenture, the Warrant Agent may notify the Warrantholders of such failure on the part of the Corporation or may itself perform any of the covenants capable of being performed by it but, subject to Section 9.2, shall be under no obligation to perform such covenants or to notify the Warrantholders of such performance by it. All sums expended or advanced by the Warrant Agent in so doing shall be repayable as provided in Section 5.3. No such performance, expenditure or advance by the Warrant Agent shall relieve the Corporation of any default hereunder or of its continuing obligations under the covenants herein contained.

ARTICLE 6

ENFORCEMENT

6.1

Suits by Warrantholders

(a)

No Warrantholder has the right to institute any action or proceeding or to exercise any other remedy authorized hereunder for the purpose of enforcing any right on behalf of the Warrantholders or for the execution of any trust or power hereunder or for the appointment of a liquidator or receiver or receiver and manager or for a receiving order under the Bankruptcy and Insolvency Act (Canada) or to have the Corporation wound up or to file or prove a claim in any liquidation or bankruptcy proceedings, unless the Warrant Agent has received a Warrantholders' Request directing it to take the requested action and has been provided with sufficient funds or other security and/or such indemnity satisfactory to the Warrant Agent in respect of the costs, expenses and liabilities that may be incurred by it in so proceeding and the Warrant Agent has failed to act within a reasonable time thereafter. If the Warrant Agent has so failed to act, but not otherwise, any Warrantholder acting on behalf of all Warrantholders will be entitled to take any of the proceedings that the Warrant Agent might have taken hereunder. No Warrantholder has any right in any manner whatsoever to effect, disturb or prejudice the rights hereby created by its action or to enforce any right hereunder or under any Warrant, except subject to the conditions and in the manner herein provided. Any money received as a result of a proceeding taken by any Warrantholder hereunder must be forthwith paid to the Warrant Agent.

(b)

All rights of action under this Supplemental Indenture may be enforced by the Warrant Agent without the possession of any of the Warrants or the production thereof on any trial or other proceedings relative thereto.

(c)

The Warrant Agent shall be entitled and empowered, either in its own name or as Warrant Agent of an express trust, or as attorney-in-fact for the Warrantholders, or in any one or more of such capacities, to file such proof of debt, amendment of proof of debt, claim, petition or other document as may be necessary or advisable in order to have the claim of the Warrant Agent and the Warrantholders allowed in any insolvency, bankruptcy, liquidation or other judicial proceedings relative to the Corporation or its creditors or relative to or affecting its property. The Warrant Agent is hereby irrevocably appointed (and the successive respective Warrantholders by taking and holding the same shall be conclusively deemed to have so appointed the Warrant Agent) the true and lawful attorney-in-fact of the respective Warrantholders or on behalf of the Warrantholders as a class, subject to deduction from any such claims of the amounts of any claims filed by any of the Warrantholders themselves if and to the extent permitted hereunder, for any proof of debt, amendment of proof of debt, claim, petition or other document in any such proceedings and to receive payment of any sums becoming distributable on account thereof, and to execute any such other papers and documents and to do and perform any and all such acts and things for and on behalf of the Warrantholders, as may be necessary or advisable in the opinion of the Warrant Agent, in order to have the respective claims of the Warrant Agent and of the Warrantholders against the Corporation or its property allowed in any such proceeding, and to receive payment of or on account of such claims; provided, however, that nothing contained in this Supplemental Indenture shall be deemed to give the Warrant Agent, unless so authorized by extraordinary resolution (as provided in Section 7.11), any right to accept or consent to any plan of reorganization or otherwise by action of any character in such proceeding to waive or change in any way any right of any Warrantholder.

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(d)

The Warrant Agent shall also have the power, but not the obligation, at any time and from time to time to institute and to maintain such suits and proceedings as it may be advised shall be necessary or advisable to preserve and protect its interests and the interests of the Warrantholders.

(e)

Any such suit or proceeding instituted by the Warrant Agent may be brought in the name of the Warrant Agent as Warrant Agent of an express trust, and any recovery of judgment shall be for the rateable benefit of the Warrantholders subject to provisions of this Supplemental Indenture. In any proceeding brought by the Warrant Agent (and also any proceeding in which a declaratory judgment of a court may be sought as to the interpretation or construction of any provision of this Supplemental Indenture, to which the Warrant Agent shall be a party), the Warrant Agent shall be held to represent all the Warrantholders, and it shall not be necessary to make any Warrantholders parties to any such proceeding.

6.2

Limitation of Liability

The obligations of the Corporation hereunder are not binding upon, nor shall resort hereunder be had to, the private property of any of the past, present or future directors or Shareholders of the Corporation or any past, present or future directors or Shareholders of any successor to the Corporation or any of the past, present or future officers, employees or agents of the Corporation or any successor to the Corporation, but only the property of the Corporation or any successor to the Corporation shall be bound in respect hereof.

6.3

Waiver of Default

Upon the happening of any default hereunder:

(a)

the holders of not less than 51% of the Warrants then outstanding shall have power (in addition to the powers exercisable by extraordinary resolution as provided in Section 7.10) by requisition in writing to instruct the Warrant Agent to waive any default hereunder and the Warrant Agent shall thereupon waive the default upon such terms and conditions as shall be prescribed in such requisition; or

(b)

the Warrant Agent shall have power to waive any default hereunder upon such terms and conditions as the Warrant Agent may deem advisable, if, in the Warrant Agent's opinion, the same shall have been cured or adequate provision made therefor;

provided that no delay or omission of the Warrant Agent or of the Warrantholders to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or acquiescence therein and provided further that no act or omission either of the Warrant Agent or of the Warrantholders in the premises shall extend to or be taken in any manner whatsoever to affect any subsequent default hereunder of the rights resulting therefrom.

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ARTICLE 7

MEETINGS OF WARRANTHOLDERS

7.1

Right to Convene Meetings

The Warrant Agent may at any time and from time to time, and shall (i) on receipt of a written request of the Corporation or of a Warrantholders' Request and (ii) upon receiving sufficient funds to cover any costs and expenses and/or being indemnified to its reasonable satisfaction by the Corporation or by the Warrantholders signing such Warrantholders' Request against the cost which may be incurred in connection with the calling and holding of such meeting, convene a meeting of the Warrantholders. In the event of the Warrant Agent failing to so convene a meeting within 15 days after receipt of such written request of the Corporation or such Warrantholders' Request and sufficient funds and/or indemnity given as aforesaid, the Corporation or such Warrantholders, as the case may be, may convene such meeting. Every such meeting shall be held in the City of Calgary or at such other place in Canada as may be approved or determined by the Warrant Agent and the Corporation.

7.2

Notice

At least 21 days' prior notice of any meeting of Warrantholders shall be given to the Warrantholders in the manner provided for in Section 10.2 and a copy of such notice shall be sent to the Warrant Agent (unless the meeting has been called by the Warrant Agent) and to the Corporation (unless the meeting has been called by the Corporation) in the manner provided for in Section 10.1. Such notice shall state the time when and the place where the meeting is to be held, shall state briefly the general nature of the business to be transacted thereat and shall contain such information as is reasonably necessary to enable the Warrantholders to make a reasoned decision on the matters to be considered at the meeting, but it shall not be necessary for any such notice to set out the terms of any resolution to be proposed or any of the provisions of this Article 7. The notice convening any such meeting may be signed by an appropriate officer of the Warrant Agent or the Corporation or by the Warrantholder or Warrantholders convening the meeting.

7.3

Chairman

An individual (who need not be a Warrantholder) designated in writing by the Warrant Agent shall be chairman of the meeting and if no individual is so designated, or if the individual so designated is not present within 15 minutes from the time fixed for the holding of the meeting, the Warrantholders present in person or by proxy shall choose an individual present to be chairman.

7.4

Quorum

Subject to the provisions of Section 7.11, at any meeting of the Warrantholders a quorum shall consist of Warrantholders present in person or by proxy representing at least 10% of the then outstanding Warrants, provided that at least two persons entitled to vote thereat are personally present. If a quorum of the Warrantholders shall not be present within 30 minutes from the time fixed for holding any meeting, the meeting, if summoned by the Warrantholders or on a Warrantholders' Request, shall be dissolved; but in any other case the meeting shall be adjourned to the same day in the next week (unless such day is not a Business Day, in which case it shall be adjourned to the next following Business Day) at the same time and place and no notice of the adjournment need be given. Any business may be brought before or dealt with at an adjourned meeting which might have been dealt with at the original meeting in accordance with the notice calling the same. No business shall be transacted at any meeting unless a quorum be present at the commencement of business. At the adjourned meeting the Warrantholders present in person or by proxy shall form a quorum and may transact the business for which the meeting was originally convened, notwithstanding that they may not represent at least 10% of the then outstanding Warrants.

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7.5

Power to Adjourn

The chairman of any meeting at which a quorum of the Warrantholders is present may, with the consent of the meeting, adjourn any such meeting, and no notice of such adjournment need be given except such notice, if any, as the meeting may prescribe.

7.6

Show of Hands

Every question submitted to a meeting shall be decided in the first place by a majority of the votes given on a show of hands except that votes on an extraordinary resolution shall be given in the manner hereinafter provided. At any such meeting, unless a poll is duly demanded as herein provided, a declaration by the chairman that a resolution has been carried or carried unanimously or by a particular majority or lost or not carried by a particular majority shall be conclusive evidence of the fact.

7.7

Poll and Voting

On every extraordinary resolution, and on any other question submitted to a meeting and after a vote by show of hands, when demanded by the chairman or by one or more of the Warrantholders acting in person or by proxy, a poll shall be taken in such manner as the chairman shall direct. Questions other than those required to be determined by extraordinary resolution shall be decided by a majority of the votes cast on the poll.

On a show of hands, every person who is present and entitled to vote, whether as a Warrantholder or as proxy for one or more absent Warrantholders, or both, shall have one vote. On a poll, each Warrantholder present in person or represented by a proxy duly appointed by instrument in writing shall be entitled to one vote in respect of each whole Warrant or Warrants then held or represented by him. A proxy need not be a Warrantholder. The chairman of any meeting shall be entitled, both on a show of hands and on a poll, to vote in respect of the Warrants, if any, held or represented by him.

7.8

Regulations

Subject to compliance with the provisions of this Supplemental Indenture, the Warrant Agent, or the Corporation with the approval of the Warrant Agent, may from time to time make and from time to time make and vary such regulations as it shall think fit for:

(a)

the setting of the record date for a meeting for the purpose of determining Warrantholders entitled to receive notice of and to vote at the meeting;

(b)

for Warrantholders to appoint a proxy or proxies to represent them and vote for them at any such meeting (and any adjournment thereof) and the manner in which same is to be executed, and for the production of the authority of any persons signing on behalf of the Warrantholder appointing them;

(c)

the deposit of instruments appointing proxies at such place and time as the Warrant Agent, the Corporation or the Warrantholders convening the meeting, as the case may be, may in the notice convening the meeting direct;

(d)

the deposit of instruments appointing proxies at some approved place or places other than the place at which the meeting is to be held and enabling particulars of such instruments appointing proxies to be mailed or sent by facsimile before the meeting to the Corporation or to the Warrant Agent at the place where the same is to be held and for the voting of proxies so deposited as though the instruments themselves were produced at the meeting;

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(e)

the form of the instrument of proxy or the manner in which it must be executed; and

(f)

generally for the calling of meetings of Warrantholders and the conduct of business thereat.

Any regulations so made shall be binding and effective and the votes given in accordance therewith shall be valid and shall be counted. Save as such regulations may provide, the only persons who shall be recognized at any meeting as a Warrantholder, or be entitled to vote or be present at the meeting in respect thereof (subject to Section 7.9), shall be Warrantholders or proxies of Warrantholders.

7.9

Corporation and Warrant Agent May be Represented

The Corporation and the Warrant Agent, by their respective directors, officers and employees, and the Counsel for the Corporation and for the Warrant Agent may attend any meeting of the Warrantholders.

7.10

Powers Exercisable by Extraordinary Resolution

In addition to all other powers conferred upon them by any other provisions of this Supplemental Indenture or by law, the Warrantholders shall, subject to the provisions of Section 7.11, have the power, exercisable from time to time by extraordinary resolution:

(a)

subject to the approval of the TSX, to agree to any modification, abrogation, alteration, compromise or arrangement of the rights of Warrantholders or, subject to the consent of the Warrant Agent, the Warrant Agent in its capacity as trustee hereunder or on behalf of the Warrantholders, in each case which may be agreed to by the Corporation, whether such rights arise under this Supplemental Indenture or the Warrant Certificates or otherwise;

(b)

subject to the approval of the TSX, to amend, alter or repeal any extraordinary resolution previously passed or sanctioned by the Warrantholders;

(c)

to direct or to authorize the Warrant Agent to enforce any of the covenants on the part of the Corporation contained in this Supplemental Indenture or the Warrant Certificates or to enforce any of the rights of the Warrantholders in any manner specified in such extraordinary resolution or to refrain from enforcing any such covenant or right;

(d)

to waive, and to direct the Warrant Agent to waive, any default on the part of the Corporation in complying with any provisions of this Supplemental Indenture or the Warrant Certificates either unconditionally or upon any conditions specified in such extraordinary resolution;

(e)

to restrain any Warrantholder from taking or instituting any suit, action or proceeding against the Corporation for the enforcement of any of the covenants on the part of the Corporation in this Supplemental Indenture or the Warrant Certificates or to enforce any of the rights of the Warrantholders;

(f)

to direct any Warrantholder who, as such, has brought any suit, action or proceeding to stay or to discontinue or otherwise to deal with the same upon payment of the costs, charges and expenses reasonably and properly incurred by such Warrantholder in connection therewith;

(g)

to assent to any change in or omission from the provisions contained in the Warrant Certificates and this Supplemental Indenture or any ancillary or supplemental instrument which may be agreed to by the Corporation, and to authorize the Warrant Agent to concur in and execute any ancillary or supplemental indenture embodying the change or omission;

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(h)

with the consent of the Corporation, not to be unreasonably withheld, to remove the Warrant Agent or its successor in office and to appoint a new trustee or trustees to take the place of the Warrant Agent so removed; and

(i)

to assent to any compromise or arrangement with any creditor or creditors or any class or classes of creditors, whether secured or otherwise, and with holders of shares or other securities of the Corporation.

7.11

Meaning of Extraordinary Resolution

(a)

The expression "extraordinary resolution" when used in this Supplemental Indenture means, subject as hereinafter provided in this Section 7.11 and in Section 7.14, a resolution proposed at a meeting of Warrantholders duly convened for that purpose and held in accordance with the provisions of this Article 7 at which there are present in person or by proxy Warrantholders representing at least 10% of the aggregate number of the then outstanding Warrants and passed by the affirmative votes of Warrantholders representing not less than 66 2/3% of the then outstanding Warrants represented at the meeting and voted on the poll upon such resolution.

(b)

If, at the meeting at which an extraordinary resolution is to be considered, Warrantholders representing at least 10% of the aggregate number of the then outstanding Warrants are not present in person or by proxy within 30 minutes after the time appointed for the meeting, then the meeting, if convened by Warrantholders or on a Warrantholders' Request, shall be dissolved; but in any other case it shall stand adjourned to such day, being not less than 15 or more than 60 days later, and to such place and time as may be appointed by the chairman. Not less than 10 days' prior notice shall be given of the time and place of such adjourned meeting in the manner provided for in Section 10.2. Such notice shall state that at the adjourned meeting, the Warrantholders present in person or by proxy shall form a quorum but it shall not be necessary to set forth the purposes for which the meeting was originally called or any other particulars. At the adjourned meeting, the Warrantholders present in person or by proxy shall form a quorum and may transact the business for which the meeting was originally convened and a resolution proposed at such adjourned meeting and passed by the requisite vote as provided in subsection 7.11(a) shall be an extraordinary resolution within the meaning of this Supplemental Indenture notwithstanding that Warrantholders representing at least 10% of the aggregate number the then outstanding Warrants are not present in person or by proxy at such adjourned meeting.

(c)

Votes on an extraordinary resolution shall always be given on a poll and no demand for a poll on an extraordinary resolution shall be necessary.

7.12

Powers Cumulative

Any one or more of the powers or any combination of the powers in this Supplemental Indenture stated to be exercisable by the Warrantholders by extraordinary resolution or otherwise may be exercised from time to time and the exercise of any one or more of such powers or any combination of powers from time to time shall not be deemed to exhaust the right of the Warrantholders to exercise such power or powers or combination of powers then or thereafter from time to time.

7.13

Minutes

Minutes of all resolutions and proceedings at every meeting of Warrantholders shall be made and duly entered in books to be provided from time to time for that purpose by the Corporation, and any such minutes as aforesaid, if signed by the chairman or the secretary of the meeting at which such resolutions were passed or proceedings had shall be prima facie evidence of the matters therein stated and, until the contrary if proved, every such meeting in respect of the proceedings of which minutes shall have been made shall be deemed to have been duly convened and held, and all resolutions passed thereat or proceedings taken shall be deemed to have been duly passed and taken.

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7.14

Instruments in Writing

All actions which may be taken and all powers that may be exercised by the Warrantholders at a meeting held as provided in this Article 7 may also be taken and exercised by Warrantholders representing at least 66 2/3% of the then outstanding Warrants by an instrument in writing signed in one or more counterparts by such Warrantholders in person or by attorney duly appointed in writing, and the expression "extraordinary resolution" when used in this Supplemental Indenture shall include an instrument so signed.

7.15

Binding Effect of Resolutions

Every resolution and every extraordinary resolution passed in accordance with the provisions of this Article 7 at a meeting of Warrantholders shall be binding upon all the Warrantholders, whether present at or absent from such meeting, and every instrument in writing signed by Warrantholders in accordance with Section 7.14 shall be binding upon all the Warrantholders, whether signatories thereto or not, and each and every Warrantholder and the Warrant Agent (subject to the provisions for indemnity herein contained) shall be bound to give effect accordingly to every such resolution and instrument in writing.

7.16

Holdings by Corporation Disregarded

In determining whether Warrantholders holding Warrant Certificates evidencing the entitlement to acquire the required number of Common Shares are present at a meeting of Warrantholders for the purpose of determining a quorum or have concurred in any consent, waiver, extraordinary resolution, Warrantholders' Request, or other action under this Supplemental Indenture, Warrants owned legally or beneficially by the Corporation or any Subsidiary of the Corporation shall be disregarded in accordance with the provisions of Section 10.7.

ARTICLE 8

SUPPLEMENTAL INDENTURES

8.1

Provision for Supplemental Indentures for Certain Purposes

From time to time the Corporation (when authorized by action of the directors) and the Warrant Agent may, subject to the provisions hereof, and they shall, when so directed in accordance with the provisions hereof, execute and deliver by their proper directors or officers, indentures or instruments supplemental hereto, which thereafter shall form part hereof, for any one or more or all of the following purposes:

(a)

setting forth any adjustments resulting from the application of the provisions of Article 4 where a supplemental indenture would be appropriate;

(b)

adding to the provisions hereof such additional covenants and enforcement provisions as, in the opinion of Counsel, are necessary or advisable in the premises, provided that the same are not in the opinion of the Warrant Agent relying on the advice of Counsel, prejudicial to the interests of the Warrantholders;

(c)

giving effect to any extraordinary resolution passed as provided in Article 7;

(d)

making such provisions not inconsistent with this Supplemental Indenture as may be necessary or desirable with respect to matters or questions arising hereunder or for the purpose of obtaining or maintaining a listing or quotation of the Warrants on any stock exchange, provided that such provisions are not, in the opinion of the Warrant Agent relying on the advice of Counsel, prejudicial to the interests of the Warrantholders;

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(e)

modifying any of the provisions of this Supplemental Indenture, including relieving the Corporation from any of the obligations, conditions or restrictions herein contained, provided that such modification or relief shall be or become operative or effective only if, in the opinion of the Warrant Agent relying on the advice of Counsel, such modification or relief in no way prejudices any of the rights of the Warrantholders or of the Warrant Agent, and provided further that the Warrant Agent may in its sole discretion decline to enter into any such supplemental indenture which in its opinion may not afford adequate protection to the Warrant Agent when the same shall become operative; and

(f)

for any other purpose not inconsistent with the terms of this Supplemental Indenture, including the correction or rectification of any ambiguities, defective or inconsistent provisions, errors, mistakes or omissions herein, provided that in the opinion of the Warrant Agent relying on the advice of Counsel the rights of the Warrant Agent and of the Warrantholders are in no way prejudiced thereby.

Notwithstanding anything to the contrary in this Supplemental Indenture, no supplement or amendment to this Supplemental Indenture or to the provisions of the Warrants may be made without the prior consent of the Toronto Stock Exchange (or such other stock exchange on which the Common Shares may be listed for trading), if required.

8.2

Successor Corporations

In the case of the consolidation, amalgamation, merger or transfer of the undertaking or assets of the Corporation as an entirety or substantially as an entirety to another person, trust, corporation, partnership or similar entity ("successor entity"), the successor entity resulting from such consolidation, amalgamation, merger or transfer (if not the Corporation) shall expressly assume, by supplemental indenture satisfactory in form to the Warrant Agent and executed and delivered to the Warrant Agent, the due and punctual performance and observance of each and every covenant and condition of this Supplemental Indenture to be performed and observed by the Corporation.

ARTICLE 9

CONCERNING THE WARRANT AGENT

9.1

Trust Indenture Legislation

(a)

If and to the extent that any provision of this Supplemental Indenture limits, qualifies or conflicts with a mandatory requirement of any legislation applicable to this Supplemental Indenture, such mandatory requirement shall prevail.

(b)

The Corporation and the Warrant Agent agree that each will, at all times in relation to this Supplemental Indenture and any action to be taken hereunder, observe and comply with and be entitled to the benefits of all legislation applicable to this Supplemental Indenture.

9.2

Rights and Duties of Warrant Agent

(a)

In the exercise of the rights and duties prescribed or conferred by the terms of this Supplemental Indenture, the Warrant Agent shall exercise that degree of care, diligence and skill that a reasonably prudent trustee would exercise in comparable circumstances. The Warrant Agent shall be liable only for its own gross negligence, or its own wilful misconduct or bad faith.

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(b)

The obligation of the Warrant Agent to commence or continue any act, action or proceeding for the purpose of enforcing any rights of the Warrant Agent or the Warrantholders hereunder shall be conditional upon the Warrantholders furnishing, when required by notice by the Warrant Agent, sufficient funds to commence or to continue such act, action or proceeding and an indemnity reasonably satisfactory to the Warrant Agent to protect and to hold harmless the Warrant Agent against the costs, charges and expenses and liabilities to be incurred thereby and any loss and damage it may suffer by reason thereof. None of the provisions contained in this Supplemental Indenture shall require the Warrant Agent to expend or to risk its own funds or otherwise to incur financial liability in the performance of any of its duties or in the exercise of any of its rights or powers unless indemnified as aforesaid.

(c)

The Warrant Agent may, before commencing or at any time during the continuance of any such act, action or proceeding, require the Warrantholders, at whose instance it is acting, to deposit with the Warrant Agent the Warrants held by them, for which Warrants the Warrant Agent shall issue receipts.

9.3

Evidence, Experts and Advisers

(a)

In addition to the reports, certificates, opinions and other evidence required by this Supplemental Indenture, the Corporation shall furnish to the Warrant Agent such additional evidence of compliance with any provision hereof, and in such form, as may be prescribed by any legislation applicable to this Supplemental Indenture or as the Warrant Agent may reasonably require by written notice to the Corporation.

(b)

In the exercise of its rights and duties hereunder, the Warrant Agent may, if it is acting in good faith, rely as to the truth of the statements and the accuracy of the opinions expressed in statutory declarations, opinions, reports, written requests, consents, or orders of the Corporation, certificates of the Corporation or other evidence furnished to the Warrant Agent pursuant to a request of the Warrant Agent, provided that such evidence complies with all legislation applicable to this Supplemental Indenture and that the Warrant Agent complies with such legislation and that the Warrant Agent examines the same and determines that such evidence complies with the applicable requirements of this Supplemental Indenture.

(c)

Whenever it is provided in this Supplemental Indenture or under any legislation applicable to this Supplemental Indenture that the Corporation shall deposit with the Warrant Agent resolutions, certificates, reports, opinions, requests, orders or other documents, it is intended that the trust, accuracy and good faith on the effective date thereof and the facts and opinions stated in all such documents so deposited shall, in each and every such case, be conditions precedent to the right of the Corporation to have the Warrant Agent take the action to be based thereon.

(d)

Proof of the execution of an instrument in writing by any Warrantholder may be made by the certificate of a notary public or other officer with similar powers, that the person signing such instrument acknowledged to it the execution thereof, or by an affidavit of a witness to such execution or in any other manner which the Warrant Agent may consider adequate.

(e)

The Warrant Agent may employ or retain at the Corporation's expense such Counsel, accountants, appraisers or other experts or advisers as it may reasonably require for the purpose of determining and discharging its duties hereunder and may pay reasonable remuneration for all services so performed by any of them, without taxation of costs of any Counsel, and shall not be responsible for any misconduct or negligence on the part of any such experts or advisers who have been appointed with due care by the Warrant Agent.

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9.4

Documents, Monies, etc. Held by Warrant Agent

Unless herein otherwise expressly provided, any of the funds held by the Warrant Agent may be deposited in a trust account in the name of the Warrant Agent (which may be held with the Warrant Agent or an affiliate or related party of the Warrant Agent) which account shall be non-interest bearing. Upon the written order of the Corporation, the Warrant Agent shall invest in its name such funds in Authorized Investments in accordance with such direction. Any direction by the Corporation to the Warrant Agent as to the investment of the funds shall be in writing and shall be provided to the Warrant Agent no later than 9:00 a.m. on the day on which the investment is to be made. Any such direction received by the Warrant Agent after 9:00 a.m. or received on a non-Business Day, shall be deemed to have been given prior to 9:00 a.m. the next Business Day. Unless the Corporation shall be in default hereunder, all interest or other income received by the Warrant Agent in respect of such deposits and investments shall belong to the Corporation.

9.5

Actions by Warrant Agent to Protect Interest

The Warrant Agent shall have power to institute and to maintain such actions and proceedings as it may consider necessary or expedient to preserve, protect or enforce its interests and the interests of the Warrantholders.

9.6

Warrant Agent Not Required to Give Security

The Warrant Agent shall not be required to give any bond or security in respect of the execution of the trusts and powers of this Supplemental Indenture or otherwise in respect of the premises.

9.7

Protection of Warrant Agent

By way of supplement to the provisions of any law for the time being relating to trustees it is expressly declared and agreed as follows:

(a)

the Warrant Agent shall not be liable for or by reason of any statements of fact or recitals in this Supplemental Indenture or in the Warrant Certificates (except the representation contained in Section 9.9 or in the certificate of the Warrant Agent on the Warrant Certificates) or be required to verify the same, but all such statements or recitals are and shall be deemed to be made by the Corporation;

(b)

nothing herein contained shall impose any obligation on the Warrant Agent to see to or to require evidence of the registration or filing (or renewal thereof) of this Supplemental Indenture or any instrument ancillary or supplemental hereto;

(c)

the Warrant Agent shall not be bound to give notice to any person or persons of the execution hereof; and

(d)

the Warrant Agent shall not incur any liability or responsibility whatever or be in any way responsible for the consequence of any breach on the part of the Corporation to any of the covenants herein contained or of any acts of any directors, officers, employees, agents or servants of the Corporation.

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9.8

Replacement of Warrant Agent; Successor by Merger

(a)

The Warrant Agent may resign its trust and be discharged from all further duties and liabilities hereunder, subject to this Section 9.8, by giving to the Corporation not less than 90 days' prior notice in writing or such shorter prior notice as the Corporation may accept as sufficient. The Warrantholders by extraordinary resolution shall have power at any time to remove the existing Warrant Agent and to appoint a new warrant agent. In the event of the Warrant Agent resigning or being removed as aforesaid or being dissolved, becoming bankrupt, going into liquidation otherwise becoming incapable of acting hereunder, the Corporation shall forthwith appoint a new trustee unless a new trustee has already been appointed by the Warrantholders; failing such appointment by the Corporation, the retiring Warrant Agent, at the Corporation's expense, or any Warrantholder may apply to a justice of the Court of Queen's Bench of the Province of Alberta on such notice as such justice may direct, for the appointment of a new trustee; but any new trustee so appointed by the Corporation or by the Court shall be subject to removal as aforesaid by the Warrantholders. Any new trustee appointed under any provision of this Section 9.8 shall be a corporation authorized to carry on the business of a trust company in the Province of Alberta and, if required by any legislation applicable to this Supplemental Indenture for any other provinces, in such other provinces. On any such appointment, the new trustee shall be vested with the same powers, rights, duties and responsibilities as if it had been originally named herein as Warrant Agent hereunder and there shall be immediately executed, at the expense of the Corporation, all such conveyances or other instruments as may, in the reasonable opinion of Counsel, be necessary or advisable to vest the new trustee with such powers, rights, duties and responsibilities, provided that the predecessor Warrant Agent shall have no obligation to execute any such conveyances or instruments until such time as it has received payment of all outstanding remuneration and expenses payable by the Corporation to such Warrant Agent under this Supplemental Indenture.

(b)

Upon the appointment of a successor trustee, the Corporation shall promptly notify the Warrantholders thereof in the manner provided for in Section 10.2 hereof.

(c)

Any corporation into or with which the Warrant Agent may be merged or consolidated or amalgamated, or any corporation resulting therefrom to which the Warrant Agent shall be a party, or any corporation succeeding to the trust business of the Warrant Agent shall be the successor to the Warrant Agent hereunder without any further act on its part or any of the parties hereto, provided that such corporation would be eligible for appointment as a successor trustee under subsection 9.8(a).

(d)

Any Warrant Certificates certified but not delivered by a predecessor trustee may be certified by the successor trustee in the name of the predecessor or successor trustee.

9.9

Conflict of Interest

(a)

The Warrant Agent represents to the Corporation that at the time of execution and delivery hereof no material conflict of interest exists between its role as a trustee hereunder and its role in any other capacity and agrees that in the event of a material conflict of interest arising hereafter it will, within 90 days after ascertaining that it has such material conflict of interest, either eliminate the same or assign its trust hereunder to a successor trustee approved by the Corporation and meeting the requirements set forth in subsection 9.8(a). Notwithstanding the foregoing provisions of this subsection 9.9(a), if any such material conflict of interest exists or hereafter shall exist, the validity and enforceability of this Supplemental Indenture and the Warrant Certificates shall not be affected in any manner whatsoever by reason thereof.

(b)

Subject to subsection 9.9(a), the Warrant Agent, in its personal or any other capacity, may buy, lend upon and deal in securities of the Corporation and generally may contract and enter into financial transactions with the Corporation or any Subsidiary of the Corporation without being liable to account for any profit made thereby.

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9.10

Acceptance of Trust

The Warrant Agent hereby accepts the trusts in this Supplemental Indenture declared and provided for and agrees to perform the same upon the terms and conditions herein set forth.

9.11

Warrant Agent Not to be Appointed Receiver

The Warrant Agent and any person related to the Warrant Agent shall not be appointed a receiver, a receiver and manager or liquidator of all or any part of the assets or undertaking of the Corporation.

9.12

Knowledge of Warrant Agent

The Warrant Agent shall not be required to take notice or be deemed to have notice, whether constructive or actual, of any matter hereunder, unless the Warrant Agent shall have received from the Corporation or a Warrantholder a notice stating the matter in respect of which the Warrant Agent should have notice.

9.13

Indemnification of Warrant Agent

In addition to and without limiting any other protection of the Warrant Agent hereunder or otherwise by law, the Corporation shall be liable for and indemnify and save harmless the Warrant Agent and its officers, directors, agents, employees and shareholders from and against any and all losses, costs, charges, expenses, damages and liabilities whatsoever arising in connection with this Supplemental Indenture, including, without limitation, those arising out of or related to actions taken or omitted to be taken by the Warrant Agent contemplated hereby, legal fees and disbursements on a solicitor and client basis, and costs and expenses incurred in connection with the enforcement of this indemnity, which the Warrant Agent may suffer or incur, whether at law or in equity, in any way caused by or arising, directly or indirectly, in respect of any act, deed, matter or thing whatsoever made, done, acquiesced in or omitted in or about or in relation to the execution of its duties as Warrant Agent and including and deed, matter or thing in relation to the execution of its duties as Warrant Agent and including any deed, matter or thing in relation to the registration, perfection, release or discharge of security. The foregoing provisions of this section do not apply to the extent that in any circumstances there has been a failure by the Warrant Agent or its employees or agents to act honestly and in good faith or where the Warrant Agent or its employees or agents have acted with gross negligence, wilful misconduct or bad faith in respect of the Warrant Agent's obligations hereunder or breached its obligations under Section 9.2(a). It is understood and agreed that this indemnification shall survive the termination of this Supplemental Indenture or the resignation of the Warrant Agent.

9.14

Warrant Agent Not Required to Give Notice of Default

The Warrant Agent shall not be bound to give any notice or do or take any act, action or proceeding by virtue of the powers conferred on it hereby unless and until it shall have been required so to do under the terms hereof; nor shall the Warrant Agent be required to take notice of any default hereunder, unless and until notified in writing of such default, which notice shall distinctly specify the default desired to be brought to the attention of the Warrant Agent and in the absence of any such notice the Warrant Agent may for all purposes of this Supplemental Indenture conclusively assume that no default has been made in the observance or performance of any of the representations, warranties, covenants, agreements or conditions contained herein. Any such notice shall in no way limit any discretion herein given to the Warrant Agent to determine whether or not the Warrant Agent shall take action with respect to any default.

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9.15

Warrant Agent's Right Not to Act

The Warrant Agent shall retain the right not to act and shall not be liable for refusing to act if, due to a lack of information or for any other reason whatsoever, the Warrant Agent, in its sole judgment, determines that such act might cause it to be in non-compliance with any applicable anti-money laundering or anti-terrorist legislation, regulation or guideline. Further, should the Warrant Agent, in its sole judgment, determine at any time that its acting under this Supplemental Indenture has resulted in it being in non-compliance with any applicable anti-money laundering or anti-terrorist legislation, regulation or guideline, then it shall have the right to resign on 10 days' written notice to the Corporation, provided that: (i) the Warrant Agent's written notice shall describe the circumstances of such non-compliance; and (ii) if such circumstances are rectified to the Warrant Agent's satisfaction within such 10-day period, then such resignation shall not be effective. In the event of the Warrant Agent resigning as aforesaid, the Corporation shall forthwith appoint a new trustee, in accordance with the provisions of Section 9.8.

9.16

No Third Party Interests

The Corporation hereby represents to the Warrant Agent that any account to be opened by, or interest to be held by, the Warrant Agent in connection with this Supplemental Indenture, for or to the credit of the Corporation is not intended to be used by or on behalf of any third party.

ARTICLE 10

GENERAL

10.1

Notice to the Corporation and the Warrant Agent

(a)

Unless herein otherwise expressly provided, any notice to be given hereunder to the Corporation or the Warrant Agent shall be deemed to be validly given if delivered or if sent by registered letter, postage prepaid or by facsimile:

If to the Corporation:

Gran Tierra Energy Inc.

300, 625 – 11th Avenue SW

Calgary, AB T2R 0E2

Attention:

Vice President, Legal and General Counsel

Fax:

(403) 265-3242

If to the Warrant Agent:

Computershare Trust Company of Canada

600, 530 – 8th Avenue SW

Calgary, AB T2P 3S8

Canada

Attention:

Corporate Trust

Fax:

403 ###-###-####

and any such notice delivered in accordance with the foregoing shall be deemed to have been received on the date of delivery or facsimile if delivered or faxed (with receipt confirmed) by 5:00 p.m. (local time) on a Business Day, or otherwise on the next Business Day or, if mailed, on the fifth Business Day following the date of the postmark on such notice.

(b)

The Corporation or the Warrant Agent, as the case may be, may from time to time notify the other in the manner provided in subsection 10.1(a) of a change of address which, from the effective date of such notice and until changed by like notice, shall be the address of the Corporation or the Warrant Agent, as the case may be, for all purposes of this Supplemental Indenture.

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(c)

If, by reason of a strike, lockout or other work stoppage, actual or threatened, involving postal employees, any notice to be given to the Warrant Agent or to the Corporation hereunder could reasonably be considered unlikely to reach its destination, such notice shall be valid and effective only if it is delivered to the named officer of the party to which it is addressed or, if it is delivered to such party at the appropriate address provided in subsection 10.1(a), by facsimile or other means of prepaid, transmitted and recorded communication.

10.2

Notice to Warrantholders

(a)

Any notice to the Warrantholders under the provisions of this Supplemental Indenture shall be valid and effective if delivered or if sent by ordinary post addressed to such holders at their postal addresses appearing on the register of Warrantholders maintained under this Supplemental Indenture. Any such notice delivered in accordance with the foregoing is deemed to have been effectively given (and received by the Warrantholders) on the date of delivery (with receipt confirmed) if such date is a Business Day or, if mailed, five Business Days following actual posting of the notice.

(b)

If, by reason of a strike, lockout or other work stoppage, actual or threatened, involving postal employees, any notice to be given to the Warrantholders hereunder could reasonably be considered unlikely to reach its destination, such notice shall be valid and effective only if it is delivered personally to such Warrantholders or if delivered to the address for such Warrantholders contained in the register of Warrants maintained by the Warrant Agent, by other means of prepaid transmitted and recorded communication. Accidental error or omission in giving notice or accidental failure to mail notice to any holder will not invalidate any action or proceeding founded thereon.

(c)

In addition to the other requirements for notice under this Section, where a meeting of Warrantholders is being convened, the Warrant Agent or Corporation may require publication of such notice in such municipalities and filing with securities regulatory authorities, as necessary to comply with applicable legal, regulatory or stock exchange requirements.

10.3

Evidence of Ownership

(a)

Upon receipt of a certificate of any bank, trust company or other depositary satisfactory to the Warrant Agent stating that the Warrants specified therein have been deposited by a named person with such bank, trust company or other depositary and will remain so deposited until the expiry of the period specified therein and the acknowledgement by the named person of such certificate, the Corporation and the Warrant Agent may treat the person so named as the owner, and such certificate as sufficient evidence of the ownership by such person of such Warrant during such period, for the purpose of any requisition, direction, consent, instrument or other document to be made, signed or given by the holder of the Warrant so deposited.

(b)

The Corporation and the Warrant Agent may accept as sufficient evidence of the fact and date of the signing of any requisition, direction, consent, instrument or other document by any person: (i) the signature of any officer of any bank, trust company, or other depositary satisfactory to the Warrant Agent as witness of such execution; (ii) the certificate of any notary public or other officer authorized to take acknowledgments of deeds to be recorded at the place where such certificate is made that the person signing acknowledged to him the execution thereof; or (iii) a satisfactory declaration of a witness of such execution.

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10.4

Counterparts

This Supplemental Indenture may be executed in several counterparts, each of which when so executed shall be deemed to be an original and such counterparts together shall constitute one and the same instrument and notwithstanding their date of execution they shall be deemed to be dated as of the date hereof.

10.5

Satisfaction and Discharge of Indenture

Upon the earlier of:

(a)

the date by which there shall have been delivered to the Warrant Agent for exercise or destruction all Warrant Certificates theretofore certified hereunder; or

(b)

30 days after the Time of Expiry or the Accelerated Time of Expiry, as applicable;

this Supplemental Indenture shall cease to be of further effect and the Warrant Agent, on demand of and at the cost and expense of the Corporation and upon delivery to the Warrant Agent of a certificate of the Corporation stating that all conditions precedent to the satisfaction and discharge of this Supplemental Indenture have been complied with, shall execute proper instruments acknowledging satisfaction of and discharging this Supplemental Indenture. Notwithstanding the foregoing, the indemnities provided to the Warrant Agent by the Corporation hereunder shall remain in full force and effect and survive the termination of this Supplemental Indenture.

10.6

Provisions of Supplemental Indenture and Warrants for the Sole Benefit of Parties and Warrantholders

Nothing in this Supplemental Indenture or in the Warrant Certificates, expressed or implied, shall give or be construed to give to any person other than the parties hereto and the Warrantholders, as the case may be, any legal or equitable right, remedy or claim under this Supplemental Indenture, or under any covenant or provision herein or therein contained, all such covenants and provisions being for the sole benefit of the parties hereto and the Warrantholders.

10.7

Warrants Owned by the Corporation or its Subsidiaries – Certificate to be Provided

For the purpose of disregarding any Warrants owned legally or beneficially by the Corporation or any Subsidiary of the Corporation in Section 7.16, the Corporation shall provide to the Warrant Agent from time to time upon request, a certificate of the Corporation setting forth as at the date of such certificate:

(a)

the names (other than the name of the Corporation) of the registered holders of Warrants which, to the knowledge of the Corporation, are owned by or held for the account of the Corporation or any Subsidiary of the Corporation; and

(b)

the number of Warrants owned legally or beneficially by the Corporation or any Subsidiary of the Corporation,

and the Warrant Agent, in making the computations in Section 7.16, shall be entitled to rely on such certificate without any additional evidence.

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10.8

Matters Relating to the Privacy of Personal Information

The parties to this Supplemental Indenture acknowledge that federal and/or provincial legislation that addresses the protection of individuals' personal information (collectively, "Privacy Laws") applies to obligations and activities under this Supplemental Indenture. Despite any other provision of this Supplemental Indenture, neither party shall take or direct any action that would contravene, or cause the other to contravene, applicable Privacy Laws. The Corporation shall, prior to transferring or causing to be transferred personal information to the Warrant Agent, obtain and retain required consents of the relevant individuals to the collection, use and disclosure of their personal information, or shall have determined that such consents either have previously been given upon which the parties can rely or are not required under the Privacy Laws. The Warrant Agent shall use commercially reasonable efforts to ensure that its services hereunder comply with Privacy Laws. Specifically, the Warrant Agent agrees: (a) to have a designated chief privacy officer; (b) to maintain policies and procedures to protect personal information and to receive and respond to any privacy compliant or inquiry; (c) to use personal information solely for the purposes of providing its services under or ancillary to this Supplemental Indenture and not to use it for any other purpose except with the consent of or direction from the Corporation or the individual involved; (d) not to sell or otherwise improperly disclose personal information to any third party; and (e) to employ administrative, physical and technological safeguards to reasonably secure and protect personal information against loss, theft, or unauthorized access, use or modification.

10.9

Matters Relating to the SEC

The Corporation confirms that it has either (i) a class of securities registered pursuant to Section 12 of the United States Securities Exchange Act; or (ii) a reporting obligation pursuant to Section 15(d) of the United States Securities Exchange Act, and has provided the Warrant Agent with an officers' certificate certifying such reporting obligation and other information as reasonably requested by the Warrant Agent. The Corporation covenants that in the event that any such registration or reporting obligation shall be terminated by the Corporation in accordance with the United States Securities Exchange Act, the Corporation shall promptly notify the Warrant Agent of such termination and such other information as the Warrant Agent may require at the time. The Corporation acknowledges that the Warrant Agent is relying upon the foregoing representation and covenants in order to meet certain SEC obligations with respect to those clients who are filing with the SEC.

10.10

Force Majeure

Except for the payment obligations of the Corporation contained herein, no party to this Warrant Indenture shall be liable to the other, or held in breach of this Supplemental Indenture, if prevented, hindered, or delayed in the performance or observance of any provision contained herein by reason of act of God, riots, terrorism, acts of war, epidemics, governmental action or judicial order, earthquakes, or any other similar causes (including, but not limited to, mechanical, electronic or communication interruptions, disruptions or failures). Performance times under this Supplemental Indenture shall be extended for a period of time equivalent to the time lost because of any delay that is excusable under this Section 10.10.

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10.11

Successors

All provisions of this Supplemental Indenture for the benefit of the Corporation and the Warrant Agent bind and enure to the benefit of their respective successors and assigns.

Executed and delivered as of the 18th day of March, 2011.

	GRAN TIERRA ENERGY INC.

	Per:	/s/ Martin Eden
		Martin Eden
		Vice-President, Finance and
		Chief Financial Officer

	PETROLIFERA PETROLEUM LIMITED

	Per:	/s/ Kristen J. Bibby
		Kristen J. Bibby
		Vice-President, Finance and
		Chief Financial Officer

	COMPUTERSHARE TRUST COMPANY OF CANADA

	Per:	/s/ Nazim Nathoo
		Nazim Nathoo
		Corporate Trust Officer

	Per:	/s/ Laura Leong
		Laura Leong
		Corporate Trust Officer

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SCHEDULE "A" to the Supplemental Indenture made as of the 18th day of March, 2011 among Gran Tierra Energy Inc., Petrolifera Petroleum Limited and Computershare Trust Company of Canada

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE LISTED ON THE TORONTO STOCK EXCHANGE ("TSX").

THE WARRANTS REPRESENTED BY THIS CERTIFICATE WILL BE VOID AND OF NO VALUE UNLESS EXERCISED BEFORE 5:00 P.M. (CALGARY TIME) ON AUGUST 28, 2011 OR THE ACCELERATED EXPIRY DATE (DEFINED BELOW), AS APPLICABLE.

WARRANTS

WARRANT CERTIFICATE NUMBER	GRAN TIERRA ENERGY INC. (A NEVADA CORPORATION)		NUMBER OF WARRANTS
		CUSIP

(HEREINAFTER REFERRED TO AS THE "HOLDER")

is nominally entitled to purchase in the manner and subject to the restrictions and adjustments set forth herein, at any time and from time to time after the date hereof until 5:00 p.m. (Calgary time) (the "Time of Expiry") August 28, 2011 (the "Expiry Date") one fully paid and non-assessable share of Common Stock ("Common Share") par value of Gran Tierra Energy Inc. (the "Corporation") at a price per Common Share of $9.67, for each Warrant represented hereby; provided, however, that the foregoing notwithstanding, no Warrant shall be exercised by payment of the exercise in cash, but rather each Warrant may only be “net exercised” (as described below) for such fraction of a Common Share as shall equal (A – B)/A, where: A = the Closing Trading Price on the date immediately preceding the date of exercise; and B = $9.67; provided further, that no fractional Common Shares shall be issued, and any fractional Common Share otherwise issuable upon exercise of the Warrants being exercised and represented hereby after aggregation of all Common Shares issuable upon such exercise shall not be issued, and cash will be paid in lieu of any fractional share entitlement based on the Current Market Price of the Common Shares, provided that the Corporation shall not be required to make any such cash payment that is less than $10.00. For purposes hereof: (1) "Closing Trading Price" means the closing trading price on the TSX on the business day immediately prior to the date on which the Warrant is exercised; (2) “Current Market Price” on a date shall mean the weighted average of the trading prices per share for such shares for any 10 consecutive Trading Days (as selected by the directors of the Corporation) during the period commencing not more than 30 Trading Days before such date on the TSX or, if on such date the Common Shares are not listed on the TSX, on such stock exchange upon which such shares are listed and as selected by the directors, or, if such shares are not listed on any stock exchange then on such over-the-counter market as may be selected for such purpose by the directors, or, if the Common Shares are not listed on any stock exchange or traded through an over-the-counter market, the Current Market Price is to be determined in good faith by the directors of the Corporation; and (3) "Trading Day" means a day on which the TSX, other stock exchange or over-the-counter market, as the case may be, is open for the transaction of business and on which the Common Shares actually trade on such exchange or market. At any time after the Issue Date and ending at the Time of Expiry, if the 20 trading day volume weighted average price of the Common Shares on the TSX (or such other stock exchange or quotation system on which the Corporation's shares are listed and where a majority of the trading volume occurs), exceeds $20.15, the Corporation may, within five business days after such an event, provide notice (the "Acceleration Notice") to the Warrantholder advising that the Warrants will expire at 5:00 p.m. (Calgary Time) (the "Accelerated Time of Expiry") on the date which is 30 days after the date of the Acceleration Notice (the "Accelerated Expiry Date") if not exercised prior to the Accelerated Time of Expiry on the Accelerated Expiry Date.

The right to purchase Common Shares may only be exercised by the holder within the time set forth above by:

(a) duly completing and executing the Exercise Form attached hereto; and

(b) surrendering this Warrant Certificate to Computershare Trust Company of Canada (the "Warrant Agent") at the principal office of the Warrant Agent in the City of Calgary or the City of Toronto.

This Warrant Certificate shall be deemed to be surrendered only upon personal delivery hereof or, if sent by mail or other means of transmission, upon actual receipt thereof by the Warrant Agent at the office referred to above.

Upon surrender of this Warrant Certificate, the person or persons in whose name or names the Common Shares issuable upon exercise of the Warrants are to be issued shall be deemed for all purposes (except as provided in the Indenture) to be the holder or holders of record of such Common Shares and the Corporation covenants that it will (subject to the provisions of the Indenture) cause a certificate or certificates representing such Common Shares to be delivered or mailed to the person or persons at the address or addresses specified in the Exercise Form.

In the event of an exercise of that number of Warrants which is fewer than the number which may be exercised hereby, the registered holder of this Warrant Certificate shall be entitled to receive without charge a new Warrant Certificate in respect of the balance of the Warrants not then exercised. Under no circumstances is the Corporation obliged to issue fractional Common Shares.

The Warrants represented by this certificate are issued under and pursuant to a Supplemental Warrant Indenture (referred to herein as the "Indenture") made as of March [__], 2011 among the Corporation, Petrolifera Petroleum Limited and the Warrant Agent. Reference is made to the Indenture and any instruments supplemental thereto for a full description of the rights of the holders of the Warrants and the terms and conditions upon which the Warrants are, or are to be, issued and held, with the same effect as if the provisions of the Indenture and all instruments supplemental thereto were herein set forth. The provisions of the Indenture will prevail in the event of conflict with this Warrant Certificate. By acceptance hereof, the holder assents to all provisions of the Indenture. Capitalized terms used in this Warrant Certificate but not defined herein have the meanings given thereto in the Indenture.

The Indenture provides for the giving of notice by the Corporation prior to taking certain actions specified therein.

The holder may, at any time prior to the Time of Expiry on the Expiry Date or the Accelerated Time of Expiry on the Accelerated Expiry Date, as applicable, upon surrender hereof to the Warrant Agent at its principal office in the City of Calgary or the City of Toronto, exchange this Warrant Certificate for other Warrant Certificates entitling the holder to acquire, in the aggregate, the same number of Common Shares as may be acquired under this Warrant Certificate.

The holding of the Warrants evidenced by this Warrant Certificate shall not constitute the holder hereof a shareholder of the Corporation or entitle the holder to any right or interest in respect thereof except as expressly provided in the Indenture and in this Warrant Certificate.

The Indenture provides that all holders of Warrants shall be bound by any resolution passed at a meeting of the holders held in accordance with the provisions of the Indenture and resolutions signed by the holders of a specified majority of the then outstanding Warrants.

The Warrants evidenced by this Warrant Certificate may be transferred on the register kept at the offices of the Warrant Agent by the registered holder hereof or its legal representatives or its attorney duly appointed by an instrument in writing in form and execution satisfactory to the Warrant Agent only upon compliance with the conditions prescribed in the Indenture and upon compliance with such reasonable requirements as the Warrant Agent may prescribe.

This Warrant Certificate shall not be valid for any purpose whatever unless and until it has been certified by or on behalf of the Warrant Agent.

Time shall be of the essence hereof. This Warrant Certificate shall be governed by and construed in accordance with the laws in force in the Province of Alberta.

IN WITNESS WHEREOF the Corporation has caused this Warrant Certificate to be signed by its duly authorized officer as of

Date .

COMPUTERSHARE TRUST COMPANY OF CANADA, as Warrant Agent		GRAN TIERRA ENERGY INC.

		By:
	This Warrant Certificate is one of the Warrant Certificates referred to in the Indenture

By:
	AUTHORIZED SIGNATURE

THE WARRANTS REPRESENTED BY THIS CERTIFICATE ARE TRANSFERABLE AT THE OFFICES OF COMPUTERSHARE TRUST COMPANY OF CANADA IN CALGARY AND TORONTO

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Any transfer of Warrants will require compliance with applicable securities legislation.

Transferors and transferees are urged to contact legal counsel before effecting any such transfer.

TRANSFER OF WARRANTS

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers to ___________________________ (Name in Full), ______________________________________________________________ (Address) __________ (Number of Warrants) Warrants of Gran Tierra Energy Inc. (the "Corporation") registered in the name of the undersigned on the records of Computershare Trust Company of Canada represented by the within Warrant Certificate and irrevocably appoints _____________________________ the attorney of the undersigned to transfer the said securities on the books or register of transfer with full power of substitution.

DATED the_______________ day of __________________, 20______.


Signature Guaranteed		Signature of Warrantholder or Authorized Representative


		Name of Warrantholder


		Name and Title of Authorized Representative

Instructions:

If the Transfer Form is signed by a trustee, executor, administrator, curator, guardian, attorney, director or officer of a corporation or any person acting in a fiduciary or representative capacity, the certificate must be accompanied by evidence of authority to sign satisfactory to the Warrant Agent and the Corporation.

2.	The signature on the Transfer Form must be guaranteed as set forth below under "Signature Guarantee".

3.	The Warrants shall only be transferable in accordance with applicable laws.

EXERCISE FORM

TO:	GRAN TIERRA ENERGY INC.

COMPUTERSHARE TRUST COMPANY OF CANADA

The undersigned hereby irrevocably exercises ___________________ Warrants to purchase Common Shares of Gran Tierra Energy Inc. (the "Corporation") (or such number of other securities or property to which such Warrants entitle the undersigned in lieu thereof or in addition thereto under the provisions of the Indenture referred to in the within Warrant Certificate) in accordance with and subject to the provisions of the Indenture.

The Common Shares (or other securities or property) are to be issued as follows:

Name:		Address in full
	(print clearly)

Social Insurance Number:

Number of Warrants Exercised:

Note: If further nominees intended, please attach (and initial) schedule giving these particulars. The number of Common Shares issuable upon exercise of the Warrants being exercised hereby shall be the “net exercise” number as set forth in the face of the Warrant certificate and in the Indenture. If a greater or lesser number of shares are issuable upon such net exercise, such number of shares shall be allocated as described set forth above and in the attachment (if any), with the adjustment to the actual number of shares issuable being made in the last listed nominee.

DATED this _____ day of __________, 20______.


Signature Guaranteed		Signature of Warrantholder or Authorized Representative


		Name of Warrantholder


		Name and Title of Authorized Representative

Please check if the Common Share certificates are to be picked up at the office of the Warrant Agent where the Warrant Certificate is surrendered or failing this Common Share certificates will be mailed to the address set forth above or if no address is specified, to the address as set forth in the records of the Corporation.

Instructions:

The registered holder may exercise its right to receive Common Shares by completing this form and surrendering this form and the Warrant Certificate representing the Warrants being exercised, together with payment, to Computershare Trust Company of Canada at its principal office at 600, 530 – 8th Avenue SW, Calgary, AB T2P 3S8, Canada. Certificates for Common Shares will be delivered or mailed as soon as practicable after the exercise of the Warrants. The rights of the registered holder hereof cease if the Warrants are not exercised by 5:00 p.m. (Calgary time) on the Expiry Date or the Accelerated Time of Expiry on the Accelerated Expiry Date, as applicable

If the Exercise Form indicates that Warrants are to be exercised and the resultant Common Shares are to be issued to a person or persons other than the registered holder of the Warrant Certificate, the signature of such holder on the Exercise Form must be guaranteed as set forth below under "Signature Guarantee".

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If the Exercise Form is signed by a trustee, executor, administrator, curator, guardian, attorney, director or officer of a corporation or any person acting in a fiduciary or representative capacity, the certificate must be accompanied by evidence of authority to sign satisfactory to the Warrant Agent and the Corporation.

Signature Guarantee:

The signature on the Transfer Form or the Exercise Form must correspond with the name as written upon the face of the certificate(s), in every particular, without alteration or enlargement, or any change whatsoever and must be guaranteed by a major Canadian Schedule I chartered bank or a member of an acceptable Medallion Signature Guarantee Program (STAMP, SEMP, MSP). The Guarantor must affix a stamp bearing the actual words “Signature Guaranteed”.

In the USA, signature guarantees must be done by members of a “Medallion Signature Guarantee Program” only.

Signature guarantees are not accepted from Treasury Branches, Credit Unions or Caisses Populaires unless they are members of the Stamp Medallion Program.

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