payoffDon't know if this caused the selloff or just profit taking. 2 million extra shares issued to prevent royalty payments to early financer Crosby on Solana's share of production. Guess GTE lawyers didn't build in thick enough boilerplate. Bobwins
Item 3.02 Unregistered Sales of Equity Securities. On November 14, 2008, Gran Tierra Energy Inc., a Nevada corporation ("Gran Tierra"), issued, pursuant to the terms of the Colombian Participation Agreement, dated June 22, 2006 (the "Colombian Participation Agreement"), between Argosy Energy International ("Argosy"), Gran Tierra and Crosby Capital, LLC ("Crosby"), as amended by Amendment No. 1 to the Colombian Participation Agreement, dated as of November 1, 2006, by and among Argosy (now Gran Tierra Energy Colombia Ltd. ("Gran Tierra Colombia")), Gran Tierra Energy, and Crosby (the "First Amendment"), and as further amended by Amendment No. 2 to the Colombian Participation Agreement, dated as of July 3, 2008, between Gran Tierra Colombia, Gran Tierra and Crosby (the "Second Amendment," together with the Colombian Participation Agreement and the First Amendment, the "Agreement"), an aggregate of 2,000,000 shares of Gran Tierra common stock, par value $0.001, in a private placement to five holders of rights to receive payments pursuant to the Agreement (the "Private Placement"). The common stock was issued solely in consideration for Crosby agreeing that their rights to receive payments on production from the properties Gran Tierra acquired in connection with the combination of Gran Tierra and Solana Resources Limited ("Solana") would not apply to Solana's interests in the properties in which Solana and Gran Tierra have joint working interests, even after the combination of the two companies. Except as described above, Gran Tierra did not receive any consideration from the Private Placement.
The Gran Tierra common stock was issued in reliance upon exemptions from registration pursuant to Section 4(2) under the Securities Act of 1933, as amended.
With the issuance of these shares, Gran Tierra's outstanding and fully diluted share numbers have been updated to reflect that Gran Tierra had 238.2 milliion shares of common stock outstanding on November 17, 2008, and 265.1 million shares of common stock outstanding on a fully diluted basis on that date.