Unassociated Document


    
      

    

    Exhibit
      4.2

    


    Dated:
      January 5, 2006

    


    NEITHER
      THIS DEBENTURE NOR THE SECURITIES INTO WHICH THIS DEBENTURE IS CONVERTIBLE
      HAVE
      BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
      COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER
      THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
      ACT”),
      AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
      REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE
      EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
      REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
      SECURITIES LAWS.

    


    
      	
              No.
                CCP-1

            	
              $2,500,000

            


    

    


    IGNIS
      PETROLEUM GROUP, INC.

    


    Secured
      Convertible Debenture

    


    


    Due
      January 5, 2009

    


    This
      Secured Convertible Debenture (the “Debenture”)
      is
      issued by IGNIS
      PETROLEUM GROUP, INC., a
      Nevada
      corporation (the “Obligor”),
      to
CORNELL
      CAPITAL PARTNERS, LP
      (the
“Holder”),
      pursuant to that certain Securities Purchase Agreement (the “Securities
      Purchase Agreement”)
      of
      even date herewith. 

    


    FOR
      VALUE RECEIVED,
      the
      Obligor hereby promises to pay to the Holder or its successors and assigns
      the
      principal sum of Two Million Five Hundred Thousand Dollars ($2,500,000) together
      with accrued but unpaid interest on or before January 5, 2009 (the “Maturity
      Date”)
      in
      accordance with the following terms:

    


    Interest. 
       Interest shall accrue on the outstanding principal balance hereof at an
      annual rate equal to seven percent (7%). Interest shall be calculated on the
      basis of a 360-day year and the actual number of days elapsed, to the extent
      permitted by applicable law. Interest hereunder will be paid to the Holder
      or
      its assignee in whose name this Debenture is registered on the records of the
      Obligor regarding registration and transfers of Debentures (the “Debenture
      Register”)
      and
      shall be paid on or before the Maturity Date in cash or in Common Stock at
      a 5%
      discount to the lowest daily VWAP (as reported by Bloomberg L.P.) during the
      30
      trading days prior to the time payment is made, at the option of the
      Obligor.

    


    Right
      of Redemption. 
       The Obligor at its option shall have the right, with three (3) business
      days advance written notice (the “Redemption
      Notice”),
      to
      redeem a portion or all amounts outstanding under this Debenture prior to the
      Maturity Date provided that the Closing Bid Price of the of the Obligor’s Common
      Stock, as reported by Bloomberg, LP, is less than the Fixed Conversion Price
      at
      the time of the Redemption Notice. In the event that the Obligor redeems a
      portion or all amounts outstanding under this Debenture, the Obligor shall
      pay
      an amount equal to the principal amount being redeemed plus a redemption premium
      (“Redemption
      Premium”)
      equal
      to fifteen percent (15%) of the principal amount being redeemed, and accrued
      interest, (collectively referred to as the “Redemption
      Amount”).
      The
      Obligor shall deliver to the Holder the Redemption Amount on the third
      (3rd)
      business day after the Redemption Notice. 


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    Notwithstanding
      the foregoing in the event that the Obligor has elected to redeem a portion
      of
      the outstanding principal amount and accrued interest under this Debenture
      the
      Holder shall be permitted to convert all or any portion of this Debenture during
      such three business day period. 

    


    Security
      Agreements. 
       This Debenture is secured by a Pledge and Escrow Agreement (the
“Pledge
      Agreement”)
      of
      even date herewith among the Obligor, the Holder, the Escrow Agent, and an
      Insider Pledge and Escrow Agreement (“Insider
      Pledge Agreement”)
      of
      even date herewith among the Obligor, the Holder, Philipp Buschmann and Michael
      Piazza and the Escrow Agent and a Security Agreement (the “Security
      Agreement”)
      of
      even date herewith between the Obligor and the Holder. Upon the full payment
      or
      conversion of this Debenture in accordance with its terms, Holder shall return
      this debenture to the Company for cancellation and shall release any security
      interest related thereto in accordance with the Security Agreement.

    


    Consent
      of Holder to Sell Capital Stock or Grant Security Interests.  
      So long as any of the principal amount or interest on this Debenture remains
      unpaid and unconverted, except for exercises or conversions of currently
      outstanding options and warrants disclosed either in the Obligor’s SEC filings
      or in the disclosure schedules to the Securities Purchase Agreement, the Obligor
      shall not, except for Permitted Issuances, without the prior consent of the
      Holder, which consent shall not be unreasonably withheld or delayed,
      (i) issue or sell any shares of Common Stock or preferred stock without
      consideration or for consideration per share less than the Closing Bid Price
      of
      the Common Stock determined immediately prior to its issuance, (ii) issue
      or sell any preferred stock, warrant, option, right, contract, call, or other
      security or instrument granting the holder thereof the right to acquire Common
      Stock without consideration or for consideration per share less than the Closing
      Bid Price of the Common Stock determined immediately prior to its issuance,
      (iii)
      enter into any security instrument, except for Permitted Liens, granting the
      holder a security interest in any of the assets of the Obligor, or
      (iv)
      file any
      registration statements on Form S-8.
      .
“Permitted Issuances” shall mean (i) securities
      issuable pursuant to any agreement in effective as of the date hereof and as
      set
      forth in the Disclosure Schedules to the Securities Purchase Agreement (which
      is
      an exhaustive list); (ii) up to 5 million securities (or options to purchase
      such securities) issuable to officers, directors, employees, or consultants
      to
      the Company pursuant to a stock option/stock incentive plan to be
      approved by the Obligor’s Board of Directors and shareholders; and (iii)
securities
      issuable to Stonegate Securities, Inc. pursuant to the Placement Agency
      Agreement dated October 21, 2005, as amended December 29, 2005.
      “Permitted Liens” shall mean (i) liens
      in
      effect on the date hereof (and renewals and replacements thereof); (ii) liens
      arising from purchase money liens or the interests of lessors under capital
      leases to the extent that such liens or interests secure purchase money
      indebtedness and so long as such Lien attaches only to the asset purchased
      or
      acquired and the proceeds thereof; and (iii) liens granted as security for
      surety or appeal bonds in connection with obtaining such bonds in the ordinary
      course of business.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    Rights
      of First Refusal. 
       For a period of 12 months from the date of the First Closing (as defined
      in the Securities Purchase Agreement), if the Obligor intends to raise
      additional capital by the issuance or sale of capital stock of the Obligor,
      except for an Permitted Issuances, including without limitation shares of any
      class of Common Stock, any class of preferred stock, options, warrants or any
      other securities convertible or exercisable into shares of Common Stock (whether
      the offering is conducted by the Obligor, underwriter, placement agent or any
      third party) the Obligor shall be obligated to offer to the Holder such issuance
      or sale of capital stock, by providing in writing the principal amount of
      capital it intends to raise and outline of the material terms of such capital
      raise, prior to the offering such issuance or sale of capital stock  to any
      third parties including, but not limited to, current or former officers or
      directors, current or former shareholders and/or investors of the obligor,
      underwriters, brokers, agents or other third parties.  The Holder shall
      have five (5) business days from receipt of such notice of the sale or issuance
      of capital stock to exercise their right during
      the five (5) business days following receipt of the notice to purchase up all
      or
      a portion of such offered Common
      Stock, any class of preferred stock, options, warrants or any other securities
      convertible or exercisable into shares of Common Stock
      in
      accordance with the terms and conditions set forth in the notice of sale in
      the
      same proportion as their portion of the purchase price bears to the total
      purchase price. 

    


    This
      Debenture is subject to the following additional provisions:

    


    Section
      1.   This
      Debenture is exchangeable for an equal aggregate principal amount of Debentures
      of different authorized denominations, as requested by the Holder surrendering
      the same. No service charge will be made for such registration of transfer
      or
      exchange.

    


    Section
      2.      
       Events
      of Default.

    


    (a)     An
      “Event
      of Default”,
      wherever used herein, means any one of the following events (whatever the reason
      and whether it shall be voluntary or involuntary or effected by operation of
      law
      or pursuant to any judgment, decree or order of any court, or any order, rule
      or
      regulation of any administrative or governmental body), provided, however,
      that
      the Holder has given Obligor notice of such Event of Default, and, if capable
      of
      being cured, five (5) business days to cure:

    


    (i)   Any
      default in the payment of the principal of, interest on or other charges in
      respect of this Debenture, free of any claim of subordination, as and when
      the
      same shall become due and payable (whether on a Conversion Date or the Maturity
      Date or by acceleration or otherwise);

    


    (ii)   The
      Obligor shall fail to observe or perform in any material respect any other
      covenant, agreement or warranty contained in, or otherwise commit any breach
      or
      default of any provision of this Debenture (except as may be covered by
Section
      2(a)(i)
      hereof)
      or any Transaction Document (as defined in Section
      5)
      which
      is not cured with in the time prescribed;


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (iii)  The
      Obligor or any subsidiary of the Obligor shall commence, or there shall be
      commenced against the Obligor or any subsidiary of the Obligor under any
      applicable bankruptcy or insolvency laws as now or hereafter in effect or any
      successor thereto, or the Obligor or any subsidiary of the Obligor commences
      any
      other proceeding under any reorganization, arrangement, adjustment of debt,
      relief of debtors, dissolution, insolvency or liquidation or similar law of
      any
      jurisdiction whether now or hereafter in effect relating to the Obligor or
      any
      subsidiary of the Obligor or there is commenced against the Obligor or any
      subsidiary of the Obligor any such bankruptcy, insolvency or other proceeding
      which remains undismissed for a period of 61 days; or the Obligor or any
      subsidiary of the Obligor is adjudicated insolvent or bankrupt; or any order
      of
      relief or other order approving any such case or proceeding is entered; or
      the
      Obligor or any subsidiary of the Obligor suffers any appointment of any
      custodian, private or court appointed receiver or the like for it or any
      substantial part of its property which continues undischarged or unstayed for
      a
      period of sixty one (61) days; or the Obligor or any subsidiary of the Obligor
      makes a general assignment for the benefit of creditors; or the Obligor or
      any
      subsidiary of the Obligor shall fail to pay, or shall state that it is unable
      to
      pay, or shall be unable to pay, its debts generally as they become due; or
      the
      Obligor or any subsidiary of the Obligor shall call a meeting of its creditors
      with a view to arranging a composition, adjustment or restructuring of its
      debts; or the Obligor or any subsidiary of the Obligor shall by any act or
      failure to act expressly indicate its consent to, approval of or acquiescence
      in
      any of the foregoing; or any corporate or other action is taken by the Obligor
      or any subsidiary of the Obligor for the purpose of effecting any of the
      foregoing;

    


    (iv)  The
      Obligor or any subsidiary of the Obligor shall default in any of its obligations
      under any other debenture or any mortgage, credit agreement or other facility,
      indenture agreement, factoring agreement or other instrument under which there
      may be issued, or by which there may be secured or evidenced any indebtedness
      for borrowed money or money due under any long term leasing or factoring
      arrangement of the Obligor or any subsidiary of the Obligor in an amount
      exceeding $100,000, whether such indebtedness now exists or shall hereafter
      be
      created and such default shall result in such indebtedness becoming or being
      declared due and payable prior to the date on which it would otherwise become
      due and payable;

    


    (v)      The
      Common Stock shall cease to be quoted for trading or listed for trading on
      either the Nasdaq OTC Bulletin Board (“OTC”),
      Nasdaq Capital Market, New York Stock Exchange, American Stock Exchange or
      the
      Nasdaq National Market (each, a “Subsequent
      Market”)
      and
      shall not again be quoted or listed for trading thereon within five (5) Trading
      Days of such delisting;

    


    (vi)    
      The
      Obligor or any subsidiary of the Obligor shall be a party to any Change of
      Control Transaction (as defined in Section
      5);
      

    


    (vii)  
       The
      Obligor shall fail to file the Underlying Shares Registration Statement (as
      defined in Section
      5)
      with
      the Commission (as defined in Section
      5),
      or the
      Underlying Shares Registration Statement shall not have been declared effective
      by the Commission, in each case within the time periods set forth in the
      Investor Registration Rights Agreement (“Registration
      Rights Agreement”)
      of
      even date herewith between the Obligor and the Holder;


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (viii)   If
      the
      effectiveness of the Underlying Shares Registration Statement lapses for any
      reason or the Holder shall not be permitted to resell the shares of Common
      Stock
      underlying this Debenture under the Underlying Shares Registration Statement,
      in
      either case, for more than five (5) consecutive Trading Days or an aggregate
      of
      eight Trading Days (which need not be consecutive Trading Days);

    


    (ix)    
       The
      Obligor shall fail for any reason to deliver Common Stock certificates to a
      Holder prior to the fifth (5th)
      Trading
      Day after a Conversion Date or the Obligor shall provide notice to the Holder,
      including by way of public announcement, at any time, of its intention not
      to
      comply with requests for conversions of this Debenture in accordance with the
      terms hereof; 

    


    (x)   
         The
      Obligor shall fail for any reason to deliver the payment in cash pursuant to
      a
      Buy-In (as defined herein) within three (3) days after notice is claimed
      delivered hereunder; 

    


    (b)   During
      the time that any portion of this Debenture is outstanding, if any Event of
      Default has occurred, the full principal amount of this Debenture, together
      with
      interest and other amounts owing in respect thereof, to the date of acceleration
      shall become at the Holder's election, immediately due and payable in cash,
      provided
      however,
      the
      Holder may request (but shall have no obligation to request) payment of such
      amounts in Common Stock of the Obligor. In addition to any other remedies,
      the
      Holder shall have the right (but not the obligation) to convert this Debenture
      at any time after (x) an Event of Default or (y) the Maturity Date at the
      Conversion Price then in-effect. The Holder need not provide and the Obligor
      hereby waives any presentment, demand, protest or other notice of any kind
      (other than the five (5) business day notice set forth in Section 2(a)), and
      the
      Holder may immediately and without expiration of any grace period (other than
      the five (5) business day notice set forth in Section 2(a))enforce any and
      all
      of its rights and remedies hereunder and all other remedies available to it
      under applicable law. Such declaration may be rescinded and annulled by Holder
      at any time prior to payment hereunder. No such rescission or annulment shall
      affect any subsequent Event of Default or impair any right consequent thereon.
      Upon an Event of Default, notwithstanding any other provision of this Debenture
      or any Transaction Document, the Holder shall have no obligation to comply
      with
      or adhere to any limitations, if any, on the conversion of this Debenture or
      the
      sale of the Underlying Shares. 

     

    
      Section
        3.       Conversion. 

    

    


    
      	 	
              (a)

            	
              Conversion
                at Option of Holder.

            


    

    


    (i)       
      This
      Debenture shall be convertible into shares of Common Stock at the option of
      the
      Holder, in whole or in part at any time and from time to time, after the
      Original Issue Date (as defined in Section
      5)
      (subject to the limitations on conversion set forth in Section
      3(b)
      hereof).
      The number of shares of Common Stock issuable upon a conversion hereunder equals
      the quotient obtained by dividing (x) the outstanding amount of this Debenture
      to be converted by (y) the Conversion Price (as defined in Section
      3(c)(i)).
      The
      Obligor shall deliver Common Stock certificates to the Holder prior to the
      Fifth
      (5th)
      Trading
      Day after a Conversion Date.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (ii)     
       Notwithstanding
      anything to the contrary contained herein, if on any Conversion Date: (1) the
      number of shares of Common Stock at the time authorized, unissued and unreserved
      for all purposes, or held as treasury stock, is insufficient to pay principal
      hereunder in shares of Common Stock; (2) the Common Stock is not listed or
      quoted for trading on the OTC or on a Subsequent Market; (3) the Obligor has
      failed to timely satisfy its conversion; or (4) the issuance of such shares
      of
      Common Stock would result in a violation of Section
      3(b),
      then,
      at the option of the Holder, the Obligor, in lieu of delivering shares of Common
      Stock pursuant to Section
      3(a)(i),
      shall
      deliver, within three (3) Trading Days of each applicable Conversion Date,
      an
      amount in cash equal to the product of the outstanding principal amount to
      be
      converted divided by the Conversion Price and multiplied by the highest closing
      price of the stock from date of the conversion notice till the date that such
      cash payment is made. Upon receipt of such cash payment by the Holder, the
      outstanding amount of this Debenture shall be reduced by the outstanding amount
      of this Debenture that was to be converted.

    


    Further,
      if the Obligor shall not have delivered any cash due in respect of conversion
      of
      this Debenture or as payment of interest thereon by the fifth (5th)
      Trading
      Day after the Conversion Date, the Holder may, by notice to the Obligor, require
      the Obligor to issue shares of Common Stock pursuant to Section
      3(c),
      except
      that for such purpose the Conversion Price applicable thereto shall be the
      lesser of the Conversion Price on the Conversion Date and the Conversion Price
      on the date of such Holder demand. Any such shares will be subject to the
      provisions of this Section.

    


    (iii)    
       The
      Holder shall effect conversions by delivering to the Obligor a completed notice
      in the form attached hereto as Exhibit A (a “Conversion
      Notice”).
      The
      date on which a Conversion Notice is delivered is the “Conversion
      Date.”
Unless
      the Holder is converting the entire principal amount outstanding under this
      Debenture, the Holder is not required to physically surrender this Debenture
      to
      the Obligor in order to effect conversions. Conversions hereunder shall have
      the
      effect of lowering the outstanding principal amount of this Debenture plus
      all
      accrued and unpaid interest thereon in an amount equal to the applicable
      conversion. The Holder and the Obligor shall maintain records showing the
      principal amount converted and the date of such conversions. 

    


    
      	 	
              (b)

            	
              Certain
                Conversion Restrictions.

            


    

    


    (i)      
       A
      Holder
      may not convert this Debenture or receive shares of Common Stock as payment
      of
      interest hereunder to the extent such conversion or receipt of such interest
      payment would result in the Holder, together with any affiliate thereof,
      beneficially owning (as determined in accordance with Section 13(d) of the
      Exchange Act and the rules promulgated thereunder) in excess of 4.99% of the
      then issued and outstanding shares of Common Stock, including shares issuable
      upon conversion of, and payment of interest on, this Debenture held by such
      Holder after application of this Section. Since the Holder will not be obligated
      to report to the Obligor the number of shares of Common Stock it may hold at
      the
      time of a conversion hereunder, unless the conversion at issue would result
      in
      the issuance of shares of Common Stock in excess of 4.99% of the then
      outstanding shares of Common Stock without regard to any other shares which
      may
      be beneficially owned by the Holder or an affiliate thereof, the Holder shall
      have the authority and obligation to determine whether the restriction contained
      in this Section will limit any particular conversion hereunder and to the extent
      that the Holder determines that the limitation contained in this Section
      applies, the determination of which portion of the principal amount of this
      Debenture is convertible shall be the responsibility and obligation of the
      Holder. If the Holder has delivered a Conversion Notice for a principal amount
      of this Debenture that, without regard to any other shares that the Holder
      or
      its affiliates may beneficially own, would result in the issuance in excess
      of
      the permitted amount hereunder, the Obligor shall notify the Holder of this
      fact
      and shall honor the conversion for the maximum principal amount permitted to
      be
      converted on such Conversion Date in accordance with the periods described
      in
Section
      3(a)(i)
      and, at
      the option of the Holder, either retain any principal amount tendered for
      conversion in excess of the permitted amount hereunder for future conversions
      or
      return such excess principal amount to the Holder. Upon an Event of Default,
      provisions of this Section may be waived by a Holder (but only as to itself
      and
      not to any other Holder) upon notice to the Obligor. Other Holders shall be
      unaffected by any such waiver.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (ii)     
       Unless
      waived by the Obligor, the Holder shall not convert more than Four Hundred
      Twenty Five Thousand Dollars ($425,000) of this Debenture in any given month
      if
      the Common Stock is below the Fixed Conversion Price (as defined herein). The
      Holder shall have no such limitation on conversion if the Common Stock is
      trading above the Fixed Conversion Price (as defined herein).  

    


    
      	 	
              (c)

            	
              Conversion
                Price and Adjustments to Conversion Price.

            


    

    


    (i)      
       The
      Holder shall be entitled to convert, at its sole option, at any time (subject
      to
      limitations contained within this Debenture) a portion or all amounts of
      principal and interest due and outstanding under this Debenture into shares
      of
      the Obligor’s Common Stock at the lesser of (i) at a price equal to $0.93 (the
“Fixed
      Conversion Price”)
      or
      (ii) ninety four percent (94%) of the lowest Volume Weighted Average Price
      of the Common Stock during the thirty (30) trading days immediately preceding
      the Conversion Date as quoted by Bloomberg, LP (the “Market
      Conversion Price”).
      The
      Fixed Conversion Price and the Market Conversion Price are collectively referred
      to as the “Conversion
      Price.”
The
      Conversion Price may be adjusted pursuant to the other terms of this
      Debenture.

    


    (ii)      
      If
      the
      Obligor, at any time while this Debenture is outstanding, shall (a) pay a
      stock dividend or otherwise make a distribution or distributions on shares
      of
      its Common Stock or any other equity or equity equivalent securities payable
      in
      shares of Common Stock, (b) subdivide outstanding shares of Common Stock into
      a
      larger number of shares, (c) combine (including by way of reverse stock split)
      outstanding shares of Common Stock into a smaller number of shares, or (d)
      issue
      by reclassification of shares of the Common Stock any shares of capital stock
      of
      the Obligor, then the Fixed Conversion Price shall be multiplied by a fraction
      of which the numerator shall be the number of shares of Common Stock (excluding
      treasury shares, if any) outstanding before such event and of which the
      denominator shall be the number of shares of Common Stock outstanding after
      such
      event. Any adjustment made pursuant to this Section shall become effective
      immediately after the record date for the determination of stockholders entitled
      to receive such dividend or distribution and shall become effective immediately
      after the effective date in the case of a subdivision, combination or
      re-classification.

    


    (iii)     
      If
      the
      Obligor, at any time while this Debenture is outstanding, shall issue rights,
      options or warrants to all holders of Common Stock (and not to the Holder)
      entitling them to subscribe for or purchase shares of Common Stock at a price
      per share less than the Fixed Conversion Price (except for Permitted Issuances),
      then the Fixed Conversion Price shall be multiplied by a fraction, of which
      the
      denominator shall be the number of shares of the Common Stock (excluding
      treasury shares, if any) outstanding on the date of issuance of such rights
      or
      warrants (plus the number of additional shares of Common Stock offered for
      subscription or purchase), and of which the numerator shall be the number of
      shares of the Common Stock (excluding treasury shares, if any) outstanding
      on
      the date of issuance of such rights or warrants, plus the number of shares
      which
      the aggregate offering price of the total number of shares so offered would
      purchase at the Fixed Conversion Price. Such adjustment shall be made whenever
      such rights or warrants are issued, and shall become effective immediately
      after
      the record date for the determination of stockholders entitled to receive such
      rights, options or warrants. However, upon the expiration of any such right,
      option or warrant to purchase shares of the Common Stock the issuance of which
      resulted in an adjustment in the Fixed Conversion Price pursuant to this
      Section, if any such right, option or warrant shall expire and shall not have
      been exercised, the Fixed Conversion Price shall immediately upon such
      expiration be recomputed and effective immediately upon such expiration be
      increased to the price which it would have been (but reflecting any other
      adjustments in the Fixed Conversion Price made pursuant to the provisions of
      this Section after the issuance of such rights or warrants) had the adjustment
      of the Fixed Conversion Price made upon the issuance of such rights, options
      or
      warrants been made on the basis of offering for subscription or purchase only
      that number of shares of the Common Stock actually purchased upon the exercise
      of such rights, options or warrants actually exercised.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (iv)    
       If
      the
      Obligor or any subsidiary thereof, as applicable, at any time while this
      Debenture is outstanding, shall issue shares, except for Permitted Issuances,
      of
      Common Stock or rights, warrants, options or other securities or debt that
      are
      convertible into or exchangeable for shares of Common Stock (“Common
      Stock Equivalents”)
      entitling any Person to acquire shares of Common Stock, at a price per share
      less than the Fixed Conversion Price (if the holder of the Common Stock or
      Common Stock Equivalent so issued shall at any time, whether by operation of
      purchase price adjustments, reset provisions, floating conversion, exercise
      or
      exchange prices or otherwise, or due to warrants, options or rights per share
      which is issued in connection with such issuance, be entitled to receive shares
      of Common Stock at a price per share which is less than the Fixed Conversion
      Price, such issuance shall be deemed to have occurred for less than the Fixed
      Conversion Price), then, at the sole option of the Holder, the Fixed Conversion
      Price shall be adjusted to mirror the conversion, exchange or purchase price
      for
      such Common Stock or Common Stock Equivalents (including any reset provisions
      thereof) at issue. Such adjustment shall be made whenever such Common Stock
      or
      Common Stock Equivalents are issued. The Obligor shall notify the Holder in
      writing, no later than one (1) business day following the issuance of any Common
      Stock or Common Stock Equivalent subject to this Section, indicating therein
      the
      applicable issuance price, or of applicable reset price, exchange price,
      conversion price and other pricing terms. No adjustment under this Section
      shall
      be made as a result of issuances and exercises of options to purchase shares
      of
      Common Stock issued for compensatory purposes pursuant to any of the Obligor's
      stock option or stock purchase plans.

    


    (v)     
       If
      the
      Obligor, at any time while this Debenture is outstanding, shall distribute
      to
      all holders of Common Stock (and not to the Holder) evidences of its
      indebtedness or assets or rights or warrants to subscribe for or purchase any
      security, then in each such case the Fixed Conversion Price at which this
      Debenture shall thereafter be convertible shall be determined by multiplying
      the
      Fixed Conversion Price in effect immediately prior to the record date fixed
      for
      determination of stockholders entitled to receive such distribution by a
      fraction of which the denominator shall be the Closing Bid Price determined
      as
      of the record date mentioned above, and of which the numerator shall be such
      Closing Bid Price on such record date less the then fair market value at such
      record date of the portion of such assets or evidence of indebtedness so
      distributed applicable to one outstanding share of the Common Stock as
      determined by the Board of Directors in good faith. In either case the
      adjustments shall be described in a statement provided to the Holder of the
      portion of assets or evidences of indebtedness so distributed or such
      subscription rights applicable to one share of Common Stock. Such adjustment
      shall be made whenever any such distribution is made and shall become effective
      immediately after the record date mentioned above.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (vi)    
       In
      case
      of any reclassification of the Common Stock or any compulsory share exchange
      pursuant to which the Common Stock is converted into other securities, cash
      or
      property, the Holder shall have the right thereafter to, at its option, (A)
      convert the then outstanding principal amount, together with all accrued but
      unpaid interest and any other amounts then owing hereunder in respect of this
      Debenture into the shares of stock and other securities, cash and property
      receivable upon or deemed to be held by holders of the Common Stock following
      such reclassification or share exchange, and the Holder of this Debenture shall
      be entitled upon such event to receive such amount of securities, cash or
      property as the shares of the Common Stock of the Obligor into which the then
      outstanding principal amount, together with all accrued but unpaid interest
      and
      any other amounts then owing hereunder in respect of this Debenture could have
      been converted immediately prior to such reclassification or share exchange
      would have been entitled, or (B) require the Obligor to prepay the outstanding
      principal amount of this Debenture, plus all interest and other amounts due
      and
      payable thereon. The entire prepayment price shall be paid in cash. This
      provision shall similarly apply to successive reclassifications or share
      exchanges.

    


    (vii)   
      The
      Obligor shall at all times reserve and keep available out of its authorized
      Common Stock not less than 500% of the shares of Common Stock issuable upon
      conversion of all outstanding amounts under this Debenture; and within three
      (3)
      Business Days following the receipt by the Obligor of a Holder's notice that
      such minimum number of Underlying Shares is not so reserved, the Obligor shall
      promptly reserve a sufficient number of shares of Common Stock to comply with
      such requirement.

    


    (viii)   
      All
      calculations under this Section
      3
      shall be
      rounded up to the nearest $0.001 or whole share.

    


    (ix)     
      Whenever
      the Conversion Price is adjusted pursuant to Section
      3
      hereof,
      the Obligor shall promptly mail to the Holder a notice setting forth the
      Conversion Price after such adjustment and setting forth a brief statement
      of
      the facts requiring such adjustment.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (x)     
       If
      (A)
      the Obligor shall declare a dividend (or any other distribution) on the Common
      Stock; (B) the Obligor shall declare a special nonrecurring cash dividend on
      or
      a redemption of the Common Stock; (C) the Obligor shall authorize the granting
      to all holders of the Common Stock rights or warrants to subscribe for or
      purchase any shares of capital stock of any class or of any rights; (D) the
      approval of any stockholders of the Obligor shall be required in connection
      with
      any reclassification of the Common Stock, any consolidation or merger to which
      the Obligor is a party, any sale or transfer of all or substantially all of
      the
      assets of the Obligor, of any compulsory share exchange whereby the Common
      Stock
      is converted into other securities, cash or property; or (E) the Obligor shall
      authorize the voluntary or involuntary dissolution, liquidation or winding
      up of
      the affairs of the Obligor; then, in each case, the Obligor shall cause to
      be
      filed at each office or agency maintained for the purpose of conversion of
      this
      Debenture, and shall cause to be mailed to the Holder at its last address as
      it
      shall appear upon the stock books of the Obligor, at least twenty (20) calendar
      days prior to the applicable record or effective date hereinafter specified,
      a
      notice stating (x) the date on which a record is to be taken for the purpose
      of
      such dividend, distribution, redemption, rights or warrants, or if a record
      is
      not to be taken, the date as of which the holders of the Common Stock of record
      to be entitled to such dividend, distributions, redemption, rights or warrants
      are to be determined or (y) the date on which such reclassification,
      consolidation, merger, sale, transfer or share exchange is expected to become
      effective or close, and the date as of which it is expected that holders of
      the
      Common Stock of record shall be entitled to exchange their shares of the Common
      Stock for securities, cash or other property deliverable upon such
      reclassification, consolidation, merger, sale, transfer or share exchange,
      provided, that the failure to mail such notice or any defect therein or in
      the
      mailing thereof shall not affect the validity of the corporate action required
      to be specified in such notice. The Holder is entitled to convert this Debenture
      during the 20-day calendar period commencing the date of such notice to the
      effective date of the event triggering such notice.

    


    (xi)  In
      case
      of any (1) merger or consolidation of the Obligor or any subsidiary of the
      Obligor with or into another Person, or (2) sale by the Obligor or any
      subsidiary of the Obligor of more than one-half of the assets of the Obligor
      in
      one or a series of related transactions, a Holder shall have the right to (A)
      exercise any rights under Section
      2(b),
      (B)
      convert the aggregate amount of this Debenture then outstanding into the shares
      of stock and other securities, cash and property receivable upon or deemed
      to be
      held by holders of Common Stock following such merger, consolidation or sale,
      and such Holder shall be entitled upon such event or series of related events
      to
      receive such amount of securities, cash and property as the shares of Common
      Stock into which such aggregate principal amount of this Debenture could have
      been converted immediately prior to such merger, consolidation or sales would
      have been entitled, or (C) in the case of a merger or consolidation, require
      the
      surviving entity to issue to the Holder a convertible Debenture with a principal
      amount equal to the aggregate principal amount of this Debenture then held
      by
      such Holder, plus all accrued and unpaid interest and other amounts owing
      thereon, which such newly issued convertible Debenture shall have terms
      identical (including with respect to conversion) to the terms of this Debenture,
      and shall be entitled to all of the rights and privileges of the Holder of
      this
      Debenture set forth herein and the agreements pursuant to which this Debentures
      were issued. In the case of clause (C), the conversion price applicable for
      the
      newly issued shares of convertible preferred stock or convertible Debentures
      shall be based upon the amount of securities, cash and property that each share
      of Common Stock would receive in such transaction and the Conversion Price
      in
      effect immediately prior to the effectiveness or closing date for such
      transaction. The terms of any such merger, sale or consolidation shall include
      such terms so as to continue to give the Holder the right to receive the
      securities, cash and property set forth in this Section upon any conversion
      or
      redemption following such event. This provision shall similarly apply to
      successive such events.

    


    
      	 	
              (d)

            	
              Other
                Provisions.

            


    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    (i)      
       The
      Obligor covenants that it will at all times reserve and keep available out
      of
      its authorized and unissued shares of Common Stock solely for the purpose of
      issuance upon conversion of this Debenture and payment of interest on this
      Debenture, each as herein provided, free from preemptive rights or any other
      actual contingent purchase rights of persons other than the Holder, not less
      than such number of shares of the Common Stock as shall (subject to any
      additional requirements of the Obligor as to reservation of such shares set
      forth in this Debenture) be issuable (taking into account the adjustments and
      restrictions of Sections
      2(b) and 3(c))
      upon
      the conversion of the outstanding principal amount of this Debenture and payment
      of interest hereunder. The Obligor covenants that all shares of Common Stock
      that shall be so issuable shall, upon issue, be duly and validly authorized,
      issued and fully paid, nonassessable and, if the Underlying Shares Registration
      Statement has been declared effective under the Securities Act, registered
      for
      public sale in accordance with such Underlying Shares Registration
      Statement.

    


    (ii)    
       Upon
      a
      conversion hereunder the Obligor shall not be required to issue stock
      certificates representing fractions of shares of the Common Stock, but may
      if
      otherwise permitted, make a cash payment in respect of any final fraction of
      a
      share based on the Closing Bid Price at such time. If the Obligor elects not,
      or
      is unable, to make such a cash payment, the Holder shall be entitled to receive,
      in lieu of the final fraction of a share, one whole share of Common
      Stock.

    


    (iii)     
      The
      issuance of certificates for shares of the Common Stock on conversion of this
      Debenture shall be made without charge to the Holder thereof for any documentary
      stamp or similar taxes that may be payable in respect of the issue or delivery
      of such certificate, provided that the Obligor shall not be required to pay
      any
      tax that may be payable in respect of any transfer involved in the issuance
      and
      delivery of any such certificate upon conversion in a name other than that
      of
      the Holder of such Debenture so converted and the Obligor shall not be required
      to issue or deliver such certificates unless or until the person or persons
      requesting the issuance thereof shall have paid to the Obligor the amount of
      such tax or shall have established to the satisfaction of the Obligor that
      such
      tax has been paid.

    


    (iv)   
       Nothing
      herein shall limit a Holder's right to pursue actual damages or declare an
      Event
      of Default pursuant to Section
      2
      herein
      for the Obligor 's failure to deliver certificates representing shares of Common
      Stock upon conversion within the period specified herein and such Holder shall
      have the right to pursue all remedies available to it at law or in equity
      including, without limitation, a decree of specific performance and/or
      injunctive relief, in each case without the need to post a bond or provide
      other
      security. The exercise of any such rights shall not prohibit the Holder from
      seeking to enforce damages pursuant to any other Section hereof or under
      applicable law. 

    


    (v)    
       In
      addition to any other rights available to the Holder, if the Obligor fails
      to
      deliver to the Holder such certificate or certificates pursuant to Section
      3(a)(i) by
      the
      fifth (5th)
      Trading
      Day after the Conversion Date, and if after such fifth (5th)
      Trading
      Day the Holder purchases (in an open market transaction or otherwise) Common
      Stock to deliver in satisfaction of a sale by such Holder of the Underlying
      Shares which the Holder anticipated receiving upon such conversion (a
“Buy-In”),
      then
      the Obligor shall (A) pay in cash to the Holder (in addition to any remedies
      available to or elected by the Holder) the amount by which (x) the Holder's
      total purchase price (including brokerage commissions, if any) for the Common
      Stock so purchased exceeds (y) the product of (1) the aggregate number of shares
      of Common Stock that such Holder anticipated receiving from the conversion
      at
      issue multiplied by (2) the market price of the Common Stock at the time of
      the
      sale giving rise to such purchase obligation and (B) at the option of the
      Holder, either reissue a Debenture in the principal amount equal to the
      principal amount of the attempted conversion or deliver to the Holder the number
      of shares of Common Stock that would have been issued had the Obligor timely
      complied with its delivery requirements under Section
      3(a)(i).
      For
      example, if the Holder purchases Common Stock having a total purchase price
      of
      $11,000 to cover a Buy-In with respect to an attempted conversion of Debentures
      with respect to which the market price of the Underlying Shares on the date
      of
      conversion was a total of $10,000 under clause (A) of the immediately preceding
      sentence, the Obligor shall be required to pay the Holder $1,000. The Holder
      shall provide the Obligor written notice indicating the amounts payable to
      the
      Holder in respect of the Buy-In.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    Section
      4.   Notices.  
       Any
      notices, consents, waivers or other communications required or permitted to
      be
      given under the terms hereof must be in writing and will be deemed to have
      been
      delivered: (i) upon receipt, when delivered personally; (ii) upon receipt,
      when
      sent by facsimile (provided confirmation of transmission is mechanically or
      electronically generated and kept on file by the sending party); or (iii) one
      (1) trading day after deposit with a nationally recognized overnight delivery
      service, in each case properly addressed to the party to receive the same.
      The
      addresses and facsimile numbers for such communications shall be:

    


    
      	
              If
                to the Obligor, to:

            	
              Ignis
                Petroleum Group, Inc.

            
	 	
              100
                Crescent Court - 7th
                Floor

            
	 	
              Dallas,
                TX 75201

            
	 	
              Attention:     
                 Michael
                Piazza

            
	 	
              Telephone:   
                 (214)
                459-8188

            
	 	
              Facsimile:      
                 (214)
                459-3101

            
	 	 
	
              With
                a copy to: 

            	
              Sichenzia
                Ross Friedman Ference LLP

            
	 	
              1065
                Avenue of the Americas - 21st
                Floor

            
	 	
              New
                York, NY 10018

            
	 	
              Attention:      
                  Gregory
                Sichenzia, Esq.

            
	 	
              Telephone:    
                  (212)
                930-9700

            
	 	
              Facsimile:      
                   (212)
                930-9725

            
	 	 
	 	
                                     
                    And

            
	 	 
	 	
              Cantey
                & Hanger, LLP

            
	 	
              801
                Cherry Street, Suite 2100

            
	 	
              Fort
                Worth, Texas 76102

            
	 	
              Attention:       
                 Douglas
                W. Clayton, Esq.

            
	 	
              Telephone:     
                 (817)
                877-2890

            
	 	
              Facsimile:        
                 (817)
                877-2807

            


       

      
        
           

        

        
           

          
            

          

        

        
           

        

         

      

      
        	
                If
                  to the Holder:

              	
                Cornell
                  Capital Partners, LP

              
	 	
                101
                  Hudson Street, Suite 3700

              
	 	
                Jersey
                  City, NJ 07303

              
	 	
                Attention:       
                   Mark
                  Angelo

              
	 	
                Telephone:     
                    (201)
                  985-8300

              
	 	 
	
                With
                  a copy to:

              	
                David
                  Gonzalez, Esq. 

              
	 	
                101
                  Hudson Street - Suite 3700

              
	 	
                Jersey
                  City, NJ 07302

              
	 	
                Telephone:      
                   (201)
                  985-8300

              
	 	
                Facsimile:          
                  (201)
                  985-8266

              


      

    

     

     

    or
      at
      such other address and/or facsimile number and/or to the attention of such
      other
      person as the recipient party has specified by written notice given to each
      other party three (3) business days prior to the effectiveness of such change.
      Written confirmation of receipt (i) given by the recipient of such notice,
      consent, waiver or other communication, (ii) mechanically or electronically
      generated by the sender's facsimile machine containing the time, date, recipient
      facsimile number and an image of the first page of such transmission or (iii)
      provided by a nationally recognized overnight delivery service, shall be
      rebuttable evidence of personal service, receipt by facsimile or receipt from
      a
      nationally recognized overnight delivery service in accordance with clause
      (i),
      (ii) or (iii) above, respectively.

    


    Section
      5.     
       Definitions. 
       For the purposes hereof, the following terms shall have the following
      meanings:

    


    “Business
      Day”
means
      any day except Saturday, Sunday and any day which shall be a federal legal
      holiday in the United States or a day on which banking institutions are
      authorized or required by law or other government action to close.

    


    “Change
      of Control Transaction”
means
      the occurrence of (a) an acquisition after the date hereof by an individual
      or
      legal entity or “group” (as described in Rule 13d-5(b)(1) promulgated under the
      Exchange Act) of effective control (whether through legal or beneficial
      ownership of capital stock of the Obligor, by contract or otherwise) of in
      excess of fifty percent (50%) of the voting securities of the Obligor (except
      that the acquisition of voting securities by the Holder shall not constitute
      a
      Change of Control Transaction for purposes hereof), (b) a replacement at one
      time or over time of more than one-half of the members of the board of directors
      of the Obligor which is not approved by a majority of those individuals who
      are
      members of the board of directors on the date hereof (or by those individuals
      who are serving as members of the board of directors on any date whose
      nomination to the board of directors was approved by a majority of the members
      of the board of directors who are members on the date hereof), (c) the merger,
      consolidation or sale of fifty percent (50%) or more of the assets of the
      Obligor or any subsidiary of the Obligor in one or a series of related
      transactions with or into another entity in which Obligor is not the surviving
      entity, or (d) the execution by the Obligor of an agreement to which the Obligor
      is a party or by which it is bound, providing for any of the events set forth
      above in (a), (b) or (c).

    


    “Commission”
means
      the Securities and Exchange Commission.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    “Common
      Stock”
means
      the common stock, par value $0.001, of the Obligor and stock of any other class
      into which such shares may hereafter be changed or reclassified.

    


    “Conversion
      Date”
shall
      mean the date upon which the Holder gives the Obligor notice of their intention
      to effectuate a conversion of this Debenture into shares of the Obligor’s Common
      Stock as outlined herein.

    


    “Closing
      Bid Price”
means
      the price per share in the last reported trade of the Common Stock on the OTC
      Bulletin Board or on the exchange which the Common Stock is then listed as
      quoted by Bloomberg, LP.

    


    “Exchange
      Act”
means
      the Securities Exchange Act of 1934, as amended.

    


    “Original
      Issue Date”
shall
      mean the date of the first issuance of this Debenture regardless of the number
      of transfers and regardless of the number of instruments, which may be issued
      to
      evidence such Debenture.

    


    “Person”
means
      a
      corporation, an association, a partnership, organization, a business, an
      individual, a government or political subdivision thereof or a governmental
      agency.

    


    “Securities
      Act”
means
      the Securities Act of 1933, as amended, and the rules and regulations
      promulgated thereunder.

    


    “Trading
      Day”
means
      a
      day on which the shares of Common Stock are quoted on the OTC or quoted or
      traded on such Subsequent Market on which the shares of Common Stock are then
      quoted or listed; provided, that in the event that the shares of Common Stock
      are not listed or quoted, then Trading Day shall mean a Business
      Day.

    


    “Transaction
      Documents”
means
      the Securities Purchase Agreement or any other agreement delivered in connection
      with the Securities Purchase Agreement, including, without limitation, the
      Pledge Agreement, the Insider Pledge Agreement, the Irrevocable Transfer Agent
      Instructions, and the Registration Rights Agreement.

    


    “Underlying
      Shares”
means
      the shares of Common Stock issuable upon conversion of this Debenture or as
      payment of interest in accordance with the terms hereof.

    


    “Underlying
      Shares Registration Statement”
means
      a
      registration statement meeting the requirements set forth in the Registration
      Rights Agreement, covering among other things the resale of the Underlying
      Shares and naming the Holder as a “selling stockholder” thereunder.

    


    Section
      6.       Except
      as
      expressly provided herein, no provision of this Debenture shall alter or impair
      the obligations of the Obligor, which are absolute and unconditional, to pay
      the
      principal of, interest and other charges (if any) on, this Debenture at the
      time, place, and rate, and in the coin or currency, herein prescribed. This
      Debenture is a direct obligation of the Obligor. This Debenture ranks pari
      passu
      with all other Debentures now or hereafter issued under the terms set forth
      herein. As long as this Debenture is outstanding, the Obligor shall not and
      shall cause their subsidiaries not to, without the consent of the Holder, (i)
      amend its articles of incorporation, bylaws or other charter documents so as
      to
      adversely affect any rights of the Holder; (ii) repay, repurchase or offer
      to
      repay, repurchase or otherwise acquire shares of its Common Stock or other
      equity securities other than as to the Underlying Shares to the extent permitted
      or required under the Transaction Documents; or (iii) enter into any agreement
      with respect to any of the foregoing. 


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    Section
      7.      
      This
      Debenture shall not entitle the Holder to any of the rights of a stockholder
      of
      the Obligor, including without limitation, the right to vote, to receive
      dividends and other distributions, or to receive any notice of, or to attend,
      meetings of stockholders or any other proceedings of the Obligor, unless and
      to
      the extent converted into shares of Common Stock in accordance with the terms
      hereof.

    


    Section
      8.     
       If
      this
      Debenture is mutilated, lost, stolen or destroyed, the Obligor shall execute
      and
      deliver, in exchange and substitution for and upon cancellation of the mutilated
      Debenture, or in lieu of or in substitution for a lost, stolen or destroyed
      Debenture, a new Debenture for the principal amount of this Debenture so
      mutilated, lost, stolen or destroyed but only upon receipt of evidence of such
      loss, theft or destruction of such Debenture, and of the ownership hereof,
      and
      indemnity, if requested, all reasonably satisfactory to the
      Obligor.

    


    Section
      9.     
       Except
      for existing purchase money security interests and liens pursuant to lease
      financing, no indebtedness of the Obligor is senior to this Debenture in right
      of payment, whether with respect to interest, damages or upon liquidation or
      dissolution or otherwise. Except for Permitted Liens, without the Holder’s
      consent, the Obligor will not and will not permit any of their subsidiaries
      to,
      directly or indirectly, enter into, create, incur, assume or suffer to exist
      any
      indebtedness of any kind, on or with respect to any of its property or assets
      now owned or hereafter acquired or any interest therein or any income or profits
      there from that is senior in any respect to the obligations of the Obligor
      under
      this Debenture.

    


    Section
      10. 
        The
      laws
      of the State of Nevada shall govern all issues concerning the relative rights
      of
      the Company and the Investors as its stockholders. All other questions
      concerning the construction, validity, enforcement and interpretation of this
      Agreement shall be governed by the internal laws of the State of New Jersey,
      without giving effect to any choice of law or conflict of law provision or
      rule
      (whether of the State of New Jersey or any other jurisdiction) that would cause
      the application of the laws of any jurisdiction other than the State of New
      Jersey. Each of the parties consents to the jurisdiction of the Superior Courts
      of the State of New Jersey sitting in Hudson County, New Jersey and the
      U.S. District Court for the District of New Jersey sitting in Newark, New
      Jersey in connection with any dispute arising under this Debenture and hereby
      waives, to the maximum extent permitted by law, any objection, including any
      objection based on forum non conveniens
      to the
      bringing of any such proceeding in such jurisdictions. 

    


    Section
      11.   
       If
      the
      Obligor fails to strictly comply with the terms of this Debenture, then the
      Obligor shall reimburse the Holder promptly for all fees, costs and expenses,
      including, without limitation, attorneys’ fees and expenses incurred by the
      Holder in any action in connection with this Debenture, including, without
      limitation, those incurred: (i) during any workout, attempted workout, and/or
      in
      connection with the rendering of legal advice as to the Holder’s rights,
      remedies and obligations, (ii) collecting any sums which become due to the
      Holder, (iii) defending or prosecuting any proceeding or any counterclaim to
      any
      proceeding or appeal; or (iv) the protection, preservation or enforcement of
      any
      rights or remedies of the Holder.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    Section
      12.   
       Any
      waiver by the Holder of a breach of any provision of this Debenture shall not
      operate as or be construed to be a waiver of any other breach of such provision
      or of any breach of any other provision of this Debenture. The failure of the
      Holder to insist upon strict adherence to any term of this Debenture on one
      or
      more occasions shall not be considered a waiver or deprive that party of the
      right thereafter to insist upon strict adherence to that term or any other
      term
      of this Debenture. Any waiver must be in writing.

    


    Section
      13.   
       If
      any
      provision of this Debenture is invalid, illegal or unenforceable, the balance
      of
      this Debenture shall remain in effect, and if any provision is inapplicable
      to
      any person or circumstance, it shall nevertheless remain applicable to all
      other
      persons and circumstances. If it shall be found that any interest or other
      amount deemed interest due hereunder shall violate applicable laws governing
      usury, the applicable rate of interest due hereunder shall automatically be
      lowered to equal the maximum permitted rate of interest. The Obligor covenants
      (to the extent that it may lawfully do so) that it shall not at any time insist
      upon, plead, or in any manner whatsoever claim or take the benefit or advantage
      of, any stay, extension or usury law or other law which would prohibit or
      forgive the Obligor from paying all or any portion of the principal of or
      interest on this Debenture as contemplated herein, wherever enacted, now or
      at
      any time hereafter in force, or which may affect the covenants or the
      performance of this indenture, and the Obligor (to the extent it may lawfully
      do
      so) hereby expressly waives all benefits or advantage of any such law, and
      covenants that it will not, by resort to any such law, hinder, delay or impeded
      the execution of any power herein granted to the Holder, but will suffer and
      permit the execution of every such as though no such law has been
      enacted.

    


    Section
      14.   
        Whenever
      any payment or other obligation hereunder shall be due on a day other than
      a
      Business Day, such payment shall be made on the next succeeding Business
      Day.

    


    Section
      15.   
        THE
      PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT ANY
      OF
      THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON
      OR
      ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY TRANSACTION
      DOCUMENT OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL
      OR WRITTEN) OR ACTIONS OF ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT
      FOR
      THE PARTIES’ ACCEPTANCE OF THIS AGREEMENT.

    


    [REMAINDER
      OF PAGE INTENTIONLLY LEFT BLANK]


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    IN
      WITNESS WHEREOF,
      the
      Obligor has caused this Secured Convertible Debenture to be duly executed by
      a
      duly authorized officer as of the date set forth above.

    


    
      	 	
              IGNIS
                PETROLEUM GROUP, INC. 

            
	 	 
	 	
              By:
                /s/
                MICHAEL PIAZZA

            
	 	
              Name: Michael
                Piazza

            
	 	
              Title: President
                & CEO