EXHIBIT 4.1


 


FORM OF NOTE


 


THIS NOTE HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS. THE NOTE MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED, PLEDGED OR HYPOTHECATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND UNDER ANY APPLICABLE
STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY, THAT AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.


 


Armada
Oil Inc.


 


Series
A Senior Unsecured 9.625% Promissory Note


 


	Original Issue Date:	 __________________	Principal Amount:	$ ________________


 


THIS SERIES A NON-NEGOTIABLE
SENIOR UNSECURED PROMISSORY NOTE is a duly authorized and validly issued Senior Unsecured Promissory Note (the “Note”
and, collectively with the other Notes of such series, the “Notes”) of Armada Oil, Inc., a Nevada corporation,
(the “Company”), having its principal place of business at 10777 Westheimer Road, Suite 1100, Houston, Texas
77042. This Note is issued and delivered in accordance with the terms and conditions set forth in that certain Securities Purchase
Agreement dated as of March [●], 2013 (the “SPA”) by and among the Company, the Holder whose name is set
forth on the Signature Page hereof, or its registered assigns (the “Holder”), and the other signatories thereto.
All capitalized terms used herein and not otherwise defined have the meaning ascribed thereto in the SPA.


 


FOR VALUE RECEIVED,
the Company promises to pay to the Holder, pursuant to the terms hereunder, the principal sum of $ _______________ (the “Principal
Amount”) on May 30, 2014 (the “Maturity Date”) or such earlier date as this Note is required or permitted
to be repaid as provided hereunder (the “Maturity Date”), and to pay interest to the Holder on the then outstanding
principal amount of this Note in accordance with the provisions hereof. This Note is subject to the following additional provisions:


 


Section 1.           Interest, Prepayment,
Amortization.


 


a)          Payment of Interest. The
Note is subject to a 9.625% interest rate on the outstanding principal amount, compounded quarterly and payable on the Maturity
Date. The interest payment will be in cash. In no event shall the rate of interest payable on this Note exceed the maximum rate
of interest permitted to be charged under applicable law. All payments due hereunder shall be payable in legal tender of the United
States of America, and in same day funds delivered to Holder by cashier’s check, certified check, or bank wire transfer to
the mailing address or bank account information provided on the signature page hereto, or at such other place as Holder shall designate
in writing for such purpose from time to time made prior to 3:00 pm, New York City, New York time, on the Maturity Date. If a payment
under this Note otherwise would become due and payable on a Saturday, Sunday or legal holiday (any other day being a “Business
Day”), the due date of the payment shall be extended to the next succeeding Business Day, and interest, if any, shall
be payable thereon during such extension.


 


b)          Prepayment. At any time
after the six month (6) anniversary date of the Original Issue Date set forth above, and prior to the Maturity Date, the Company
shall have the right to prepay this Note, in whole or in part, without penalty, on ten (10) days’ advance notice to Holder.
On such prepayment date, the Company will pay in respect of this Note cash equal to the face amount plus accrued Interest on the
Note (or portion thereof) being prepaid.


 


c)          Unsecured Indebtedness.
This Note is unsecured.


 






    	 



    	 



    

  


Section 2.           Registration of Transfers
and Exchanges.


 





a)          Different
Denominations. This Note is exchangeable for an equal aggregate principal amount of Notes of different authorized denominations,
as requested by the Holder surrendering the same. No service charge will be payable for such registration of transfer or exchange.


 


b)          Investment Representations.
This Note has been issued subject to certain investment representations of the original Holder set forth in the SPA and may be
transferred or exchanged only in compliance with the SPA and applicable federal and state securities laws and regulations.


 


c)         Reliance on Note Register.
Prior to due presentment for transfer to the Company of this Note, the Company and any agent of the Company may treat the Person
in whose name this Note is duly registered on the Note Register as the owner hereof for the purpose of receiving payment as herein
provided and for all other purposes, whether or not this Note is overdue, and neither the Company nor any such agent shall be affected
by notice to the contrary.


 


Section 3.           Events of Default.


 


a)          “Event of Default”
means, wherever used herein, any of the following events (whatever the reason for such event and whether such event 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):


 


i.          any default in the payment of (A) the principal amount
of any Note or (B) interest, liquidated damages and other amounts owing to a Holder on any Note, as and when the same shall become
due and payable (whether on a Conversion Date or the Maturity Date or by acceleration or otherwise) which default, solely in the
case of an interest payment or other default under clause (B) above, is not cured within ten (10) Business Days;


 


ii.         the Company shall fail to observe or perform any
other covenant or agreement contained in the Notes which failure is not cured, if possible to cure, within the earlier to occur
of (A) ten (10) Business Days after notice of such failure sent by the Holder or by any other Holder to the Company and (B) fifteen
(15) Business Days after the Company has become or should have become aware of such failure;


 


iii.          a default or Event of Default (subject to any grace
or cure period provided in the applicable agreement, document or instrument) shall occur under any of the Transaction Documents;


 


iv.         any
representation or warranty made in this Note, any other Transaction Documents, any written statement pursuant hereto or thereto
or any other report, financial statement or certificate made or delivered to the Holder or any other Holder shall be untrue or
incorrect in any material respect as of the date when made or deemed made;


 


v.          the Company or any Significant
Subsidiary (as such term is defined in Rule 1-02(w) of Regulation S-X) shall be subject to a Bankruptcy Event; for purposes hereof,
“Bankruptcy Event” means any of the following events: (a) the Company or any Significant Subsidiary thereof
commences a case or other proceeding under any bankruptcy, reorganization, arrangement, adjustment of debt, relief of debtors,
dissolution, insolvency or liquidation or similar law of any jurisdiction relating to the Company or any Significant Subsidiary
thereof, (b) there is commenced against the Company or any Significant Subsidiary thereof any such case or proceeding that is not
dismissed within sixty (60) days after commencement, (c) the Company or any Significant Subsidiary thereof is adjudicated insolvent
or bankrupt or any order of relief or other order approving any such case or proceeding is entered, (d) the Company or any Significant
Subsidiary thereof suffers any appointment of any custodian or the like for it or any substantial part of its property that is
not discharged or stayed within sixty (60) calendar days after such appointment, (e) the Company or any Significant Subsidiary
thereof makes a general assignment for the benefit of creditors, or (f) the Company or any Significant Subsidiary thereof, by any
act or failure to act, expressly indicates its consent to, approval of or acquiescence in any of the foregoing or takes any corporate
or other action for the purpose of effecting any of the foregoing.


 




    	 



    	 



    

 


vi.          the
Company or any Significant Subsidiary shall default on any of its obligations under 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 that (a) involves
an obligation greater than Three Hundred Fifty Thousand Dollars ($350,000), whether such indebtedness now exists or shall hereafter
be created, and (b) results in such indebtedness becoming or being declared due and payable prior to the date on which it would
otherwise become due and payable;


 


vii.         the Common Stock shall not
be eligible for listing or quotation for trading on a Trading Market and shall not be eligible to resume listing or quotation for
trading thereon within five (5) Business Days;


 


viii.       the Company does not meet
the current public information requirements under Rule 144 in respect of the Warrant Shares;


 


ix.         any monetary judgment, writ
or similar final process shall be entered or filed against the Company, any subsidiary or any of their respective property or other
assets for more than Three Hundred Fifty Thousand Dollars ($350,000), and such judgment, writ or similar final process shall remain
unvacated, unbonded or unstayed for a period of forty-five (45) calendar days; or


 


b)         Remedies Upon Event of Default.
If any Event of Default occurs, the outstanding principal amount of this Note, plus accrued but unpaid interest, liquidated damages
and other amounts owing in respect thereof through the date of acceleration, shall become, at the Holder’s election, immediately
due and payable in cash. Commencing ten (10) Business Days after the occurrence of any Event of Default that results in the eventual
acceleration of this Note. Upon the payment in full of the default amount, the Holder shall promptly surrender this Note to or
as directed by the Company. In connection with such acceleration described herein, the Holder need not provide, and the Company
hereby waives, any presentment, demand, protest or other notice of any kind, and the Holder may immediately and without expiration
of any grace period enforce any and all of its rights and remedies hereunder and all other remedies available to it under applicable
law. Such acceleration may be rescinded and annulled by Holder at any time prior to payment hereunder and the Holder shall have
all rights as a holder of the Note until such time, if any, as the Holder receives full payment pursuant to this Section 3(b).
No such rescission or annulment shall affect any subsequent Event of Default or impair any right consequent thereon.


 


Section 4.           Miscellaneous.


 


a)          Notices. Any and all notices
or other communications or deliveries to be provided by the Holder or the Company hereunder are to be made in accordance with the
provisions of Section 6.4 of the SPA.


 


b)          Absolute Obligation. Except
as expressly provided herein, no provision of this Note shall alter or impair the obligation of the Company, which is absolute
and unconditional, to pay the principal of, liquidated damages and accrued interest, as applicable, on this Note at the time, place,
and rate, and in the coin or currency, herein prescribed. This Note is a direct debt obligation of the Company.


 


c)          Lost or Mutilated Note.
If this Note shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver, in exchange and substitution
for and upon cancellation of a mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed Note, a new Note
for the principal amount of this Note so mutilated, lost, stolen or destroyed, but only upon receipt of evidence of such loss,
theft or destruction of such Note, and of the ownership hereof, reasonably satisfactory to the Company.


 




    	 



    	 



    

 


d)         Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this Note shall be governed by
and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflict
of laws thereof. Each party agrees that all legal proceedings concerning the interpretation, enforcement and defense of the transactions
contemplated by any of the Transaction Documents (whether brought against a party hereto or its respective Affiliates, directors,
officers, shareholders, employees or agents) shall be commenced in the state and federal courts sitting in the City of New York,
Borough of Manhattan (the “New York Courts”). Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby
irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to
the jurisdiction of such New York Courts, or such New York Courts are improper or inconvenient venue for such proceeding. Each
party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding
by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the
address in effect for notices to it under this Note and agrees that such service shall constitute good and sufficient service of
process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other
manner permitted by applicable law. Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable
law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Note or the transactions contemplated
hereby. If either party shall commence an action or proceeding to enforce any provisions of this Note, then the prevailing party
in such action or proceeding shall be reimbursed by the other party for its attorneys’ fees and other costs and expenses
incurred in the investigation, preparation and prosecution of such action or proceeding.


 


e)          Waiver. Any waiver by
the Company or the Holder of a breach of any provision of this Note 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 Note. The failure of the Company or the Holder to
insist upon strict adherence to any term of this Note 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 Note. Any waiver by the Company
or the Holder must be in writing.


 


f)          Severability. If any provision
of this Note is invalid, illegal or unenforceable, the balance of this Note 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 violates the applicable law governing usury, the applicable rate
of interest due hereunder shall automatically be lowered to equal the maximum rate of interest permitted under applicable law.
The Company 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 Company from paying all or any portion of the principal of or interest on this Note 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 Company
(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 impede the execution of any power herein granted to the Holder, but will
suffer and permit the execution of every such power as though no such law has been enacted.


 


g)          Next Business Day. 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.


 


h)          Headings. The headings
contained herein are for convenience only, do not constitute a part of this Note and shall not be deemed to limit or affect any
of the provisions hereof.


 




    	 



    	 



    

 


i)          Assumption.
Any successor to the Company or any surviving entity in a Fundamental Transaction shall (i) assume, prior to such Fundamental
Transaction, all of the obligations of the Company under this Note and the other Transaction Documents pursuant to written agreements
in form and substance satisfactory to the Holder (such approval not to be unreasonably withheld or delayed) and (ii) issue to
the Holder a new Note of such successor entity evidenced by a written instrument substantially similar in form and substance to
this Note, including, without limitation, having a principal amount and interest rate equal to the principal amount and the interest
rate of this Note and having similar ranking to this Note, which shall be satisfactory to the Holder (any such approval not to
be unreasonably withheld or delayed). The provisions of this Section 4(i) shall apply similarly and equally to successive
Fundamental Transactions and shall be applied without regard to any limitations of this Note. For purposes of this Note, “Fundamental
Transaction” means that (i) (1) the Company or any Significant Subsidiary shall, directly or indirectly, in one or more
related transactions, consolidate or merge with or into (whether or not the Company or any of its Subsidiaries is the surviving
corporation) any other Person, or (2) the Company or any of its Significant Subsidiaries shall, directly or indirectly, in one
or more related transactions, sell, lease, license, assign, transfer, convey or otherwise dispose of all or substantially all
of its respective properties or assets to any other Person, or (3) the Company or any of its Significant Subsidiaries shall, directly
or indirectly, in one or more related transactions, allow any other Person to make a purchase, tender or exchange offer that is
accepted by the holders of more than 50% of the outstanding shares of voting stock of the Company (not including any shares of
voting stock of the Company held by the Person or Persons making or party to, or associated or affiliated with the Persons making
or party to, such purchase, tender or exchange offer), or (4) the Company or any of its Significant Subsidiaries shall, directly
or indirectly, in one or more related transactions, consummate a stock or share purchase agreement or other business combination
(including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with any other Person whereby
such other Person acquires more than 50% of the outstanding shares of voting stock of the Company (not including any shares of
voting stock of the Company held by the other Person or other Persons making or party to, or associated or affiliated with the
other Persons making or party to, such stock or share purchase agreement or other business combination), or (5) the Company or
any of its Significant Subsidiaries shall, directly or indirectly, in one or more related transactions, reorganize, recapitalize
or reclassify the Common Stock, other than an increase in the number of authorized shares of the Company’s Common Stock,
or (ii) any “person” or “group” (as these terms are used for purposes of Sections 13(d) and 14(d) of the
Exchange Act and the rules and regulations promulgated thereunder) is or shall become the “beneficial owner” (as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly, of 50% of the aggregate ordinary voting power represented by issued
and outstanding voting stock of the Company. Anything herein to the contrary notwithstanding, a Fundamental Transaction shall
not include the acquisition of substantially all of the assets of Mesa Energy Holdings, Inc. pursuant to the Asset Purchase Agreement
and Plan of Reorganization entered into by the Company, Mesa Energy Holdings, Inc. and Mesa Energy, Inc. on November 14, 2012
and amended on February 19, 2013. 


 


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