American Petro-Hunter Inc.: Exhibit 10.26 - Filed by newsfilecorp.com





AMERICAN PETRO-HUNTER, INC. 

$140,000 

TWELVE PERCENT (12%) CONVERTIBLE NOTE 
DATED MARCH 4,
2013

THIS NOTE (the “Note”) is a duly authorized Convertible Note of
AMERICAN PETRO-HUNTER, INC., a(n) NEVADA corporation (the “Company”). 

FOR VALUE RECEIVED, the Company promises to pay Magna Group,
LLC (the “Holder”), the principal sum of $140,000 (the “Principal Amount”) or
such lesser principal amount following the conversion or conversions of this
Note in accordance with Paragraph 2 (the “Outstanding Principal Amount”) on
September 4, 2013 (the “Maturity Date”), and to pay interest on the Outstanding
Principal Amount (“Interest”) in a lump sum on the Maturity Date, at the rate of
twelve percent (12%) per Annum (the “Rate”) from the date of issuance. 

Accrual of Interest shall commence on the date of this Note and
continue until the Company repays or provides for repayment in full the
Outstanding Principal Amount and all accrued but unpaid Interest. Accrued and
unpaid Interest shall bear Interest at the Rate until paid, compounded monthly.
The Outstanding Principal Amount of this Note is payable on the Maturity Date in
such coin or currency of the United States as at the time of payment is legal
tender for payment of public and private debts, at the address last appearing on
the Note Register of the Company as designated in writing by the Holder from
time to time. The Company may prepay principal and interest on this Note at any
time before the Maturity Date. 

The Company will pay the Outstanding Principal Amount of this
Note on the Maturity Date, free of any withholding or deduction of any kind
(subject to the provision of paragraph 2 below), to the Holder as of the
Maturity Date and addressed to the Holder at the address appearing on the Note
Register. 

This Note is subject to the following additional provisions:


            1.       
All payments on account of the Outstanding Principal Amount of this Note and all
other amounts payable under this Note (whether made by the Company or any other
person) to or for the account of the Holder hereunder shall be made free and
clear of and without reduction by reason of any present and future income,
stamp, registration and other taxes, levies, duties, cost, and charges
whatsoever imposed, assessed, levied or collected by the United States or any
political subdivision or taxing authority thereof or therein, together with
interest thereon and penalties with respect thereto, if any, on or in respect of
this Note (such taxes, levies, duties, costs and charges being herein
collectively called “Taxes”). 

            2.       
The Holder of this Note is entitled, at its option, at any time after the
issuance of this Note, to convert all or any lesser portion of the Outstanding
Principal Amount and accrued but unpaid Interest into Common Stock at a
conversion price (the “Conversion Price”) for each share of Common Stock equal
to a price which is a 45% discount from the lowest trading price in the 5 days
prior to the day that the Holder requests conversion, unless otherwise modified
by mutual agreement between the Parties (the “Conversion Price”) (The Common
stock into which the Note is converted shall be referred to in this agreement as
“Conversion Shares”). If the Issuer’s Common stock is chilled for deposit at DTC
and/or becomes chilled at any point while this Agreement remains outstanding, an
additional 8% discount will be attributed to the Conversion Price defined
hereof. The Issuer will not be obligated to issue fractional Conversion Shares.
The Holder may convert this Note into Common Stock by surrendering the Note to
the Company, with the form of conversion notice attached to the Note as Exhibit
B, executed by the Holder of the Note evidencing such Holder’s intention to
convert the Note. Additionally, in no event shall the Conversion Price be less
than $0.00004. If the Borrower is unable to issue any shares under this
provision due to the fact that there is an insufficient number of authorized and
unissued shares available, the Holder promises not to force the Borrower to
issue these shares or trigger an Event of Default, provided that Borrower takes
immediate steps required to get the appropriate level of approval from
shareholders or the board of directors, where applicable to raise the number of
authorized shares to satisfy the Notice of Conversion. 

            The
Company will not issue fractional shares or scrip representing fractions of
shares of Common Stock on conversion, but the Company will round the number of
shares of Common Stock issuable up to the nearest whole share. The date on which
a Notice of Conversion is given shall be deemed to be the date on which the
Holder notifies the Company of its intention to so convert by delivery, by
facsimile transmission or otherwise, of a copy of the Notice of Conversion.
Notice of Conversion may be sent by email to the Company, attn: Mr. Robert
McIntosh, CEO, President. The Holder will deliver this Note, together with original executed copy of the Notice of
Conversion, to the Company within three (3) business days following the
Conversion Date. At the Maturity Date, the Company will pay any unconverted
Outstanding Principal Amount and accrued Interest thereon, at the option of the
Company, in either (a) cash or (b) Common Stock valued at a price equal to the
Conversion Price determined as if the Note was converted in accordance with its
terms into Common Stock on the Maturity Date. 

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            3.       
No provision of this Note shall alter or impair the obligation of the Company,
which is absolute and unconditional, to the payment of the Outstanding Principal
Amount of this Note at the Maturity Date, and in the coin or currency herein
prescribed. This Note and all other Notes now or hereafter issued on similar
terms are direct obligations of the Company. In the event of any liquidation,
reorganization, winding up or dissolution, repayment of this Note shall not be
subordinate in any respect to any other indebtedness of the Company outstanding
as of the date of this Note or hereafter incurred by the Company. 

Such non-subordination shall extend without limiting the
generality of the foregoing, to all indebtedness of the Company to banks,
financial institutions, other secured lenders, equipment lessors and equipment
finance companies, but shall exclude trade debts. Any warrants, options or other
securities convertible into stock of the Company issued before the date hereof
shall rank pari passu with the Note in all respects 

            4.       
If at any time or from time to time after the date of this Note, the Common
Stock issuable upon the conversion of the Note is changed into the same or
different numbers of shares of any class or classes of stock, whether by
recapitalization or otherwise, then in each such event the Holder shall have the
right thereafter to convert the Note into the kind of security receivable in
such recapitalization, reclassification or other change by holders of Common
Stock, all subject to further adjustment as provided herein. In such event, the
formulae set forth herein for conversion and redemption shall be equitably
adjusted to reflect such change in number of shares or, if shares of a new class
of stock are issued, to reflect the market price of the class or classes of
stock issued in connection with the above described transaction. 

           
5.        Events of Default. 

5.1.        A default shall be
deemed to have occurred upon any one of the following events: 

	 	5.1.1. 	
      Withdrawal from registration of the Issuer under the
      Securities Exchange Act of 1934, as amended (the “Exchange Act”), either
      voluntary or involuntary.

	 	 	 
	 	5.1.2. 	
      Issuer filing for bankruptcy protection under the federal
      bankruptcy laws, the calling of a meeting of creditors, or any act of
      insolvency under any state law regarding insolvency, without written
      notification to the Investor within five business days of such filing,
      meeting or action.

	 	 	 
	 	5.1.3. 	
      The Borrower fails to issue shares of Common Stock to the
      Holder (or announces or threatens in writing that it will not honor its
      obligation to do so) upon exercise by the Holder of the conversion rights
      of the Holder in accordance with the terms of this Note, fails to transfer
      or cause its transfer agent to transfer (issue) (electronically or in
      certificated form) any certificate for shares of Common Stock issued to
      the Holder upon conversion of or otherwise pursuant to this Note as and
      when required by this Note, the Borrower directs its transfer agent not to
      transfer or delays, impairs, and/or hinders its transfer agent in
      transferring or issuing (electronically or in certificated form) any
      certificate for shares of Common Stock to be issued to the Holder upon
      conversion of or otherwise pursuant to this Note as and when required by
      this Note, or fails to remove (or directs its transfer agent not to remove
      or impairs, delays, and/or hinders its transfer agent from removing) any
      restrictive legend (or to withdraw any stop transfer instructions in
      respect thereof) on any certificate for any shares of Common Stock issued
      to the Holder upon conversion of or otherwise pursuant to this Note as and
      when required by this Note (or makes any written announcement, statement
      or threat that it does not intend to honor the obligations described in
      this paragraph) and any such failure shall continue uncured (or any
      written announcement, statement or threat not to honor its obligations
      shall not be rescinded in writing) for three (3) business days after the
      Holder shall have delivered a Notice of
Conversion.



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	 	5.1.4. 	
      Failure to pay the principal and unpaid but accrued
      interest on the Note when due.

	 	 	 
	 	5.1.5. 	
      Any dissolution, liquidation, or winding up of Borrower
      or any substantial portion of its business.

	 	 	 
	 	5.1.6. 	
      Any cessation of operations by Borrower or Borrower
      admits it is otherwise generally unable to pay its debts as such debts
      become due, provided, however, that any disclosure of the Borrower’s
      ability to continue as a “going concern” shall not be an admission that
      the Borrower cannot pay its debts as they become due.

	 	 	 
	 	5.1.7. 	
      The failure by Borrower to maintain any material
      intellectual property rights, personal, real property or other assets
      which are necessary to conduct its business (whether now or in the
      future).

	 	 	 
	 	5.1.8. 	
      The Borrower effectuates a reverse split of its Common
      Stock without twenty (20) days prior written notice to the
  Holder.

	 	 	 
	 	5.1.9 	
      In the event that the Borrower proposes to replace its
      transfer agent, the Borrower fails to provide, prior to the effective date
      of such replacement, fully executed Irrevocable Transfer Agent
      Instructions in a form as initially delivered pursuant to the Purchase
      Agreement (including but not limited to the provision to irrevocable
      reserve shares of Common Stock in the Reserved Amount) signed by the
      successor transfer agent to Holder and the Borrower.

	 	 	 
	 	5.1.10 	
      The failure by Borrower to pay any and all Post-Closing
      Expenses as defined in section 7.4.

	 	 	 
	 	5.1.11 	
      From and after the initial trading, listing or quotation
      of the Common Stock on a Principal Market, an event resulting in the
      Common Stock no longer being traded, listed or quoted on a Principal
      Market; failure to comply with the requirements for continued quotation on
      a Principal Market; or notification from a Principal Market that the
      Borrower is not in compliance with the conditions for such continued
      quotation and such non-compliance continues for seven (7) trading days
      following such notification.




		5.2. 	
      Default remedies. Upon the occurrence and during the
      continuation of any Event of Default specified in Section 2.6.4 (solely
      with respect to failure to pay the principal hereof or interest thereon
      when due at the Maturity Date), the Note shall become immediately due and
      payable and the Borrower shall pay to the Holder, in full satisfaction of
      its obligations hereunder, an amount equal to the Default Sum (as defined
      herein). UPON THE OCCURRENCE AND DURING THE CONTINUATION OF ANY EVENT OF
      DEFAULT SPECIFIED IN SECTION 2.6.3, THE NOTE SHALL BECOME IMMEDIATELY DUE
      AND PAYABLE AND THE BORROWER SHALL PAY TO THE HOLDER, IN FULL SATISFACTION
      OF ITS OBLIGTAIONS HEREUNDER, AN AMOUNT EQUAL TO: (Y) THE DEFAULT SUM (AS
      DEFINED HEREIN); MULTIPLIED BY (Z) TWO (2). Upon the occurrence and during
      the continuation of any Event of Default specified in Sections 2.6.4
      (solely with respect to failure to pay the principal hereof or interest
      thereon when due on this Note, 2.6.1, 2.6.2, 2.6.5, 2.6.6, 2.6.7, 2.6.8,
      and/or 2.6.9 exercisable through the delivery of written notice to the
      Borrower by such Holders (the “Default Notice”), and upon the occurrence
      of an Event of Default specified in the remaining sections of Section 2.6
      (other than failure to pay the principal hereof or interest thereon at the
      Maturity Date specified in Section 2.6.4 hereof), the Note shall become
      immediately due and payable and the Borrower shall pay to the Holder, in
      full satisfaction of its obligations hereunder, an amount equal to the
      greater of (i) 150% times the sum of (w) the then
      outstanding principal amount of this Note plus (x) accrued and
      unpaid interest on the unpaid principal amount of this Note to the date of
      payment (the “Mandatory Prepayment Date”) plus (y) Default
      Interest, if any, on the amounts referred to in clauses (w) and/or (x)
      (the then outstanding principal amount of this Note to the date of payment
      plus the amounts referred to in clauses (x) and (y) shall
      collectively be known as the “Default Sum”) or (ii) the “parity value” of
      the Default Sum to be prepaid, where parity value means (a)
  the highest number of shares of Common
Stock issuable upon conversion of or otherwise pursuant to such Default Sum,
treating the Trading Day immediately preceding the Mandatory Prepayment Date as
the “Conversion Date” for purposes of determining the lowest applicable
Conversion Price, unless the Default Event arises as a result of such breach in
respect of a specific Conversion Date in which case such Conversion Date shall
be the Conversion Date, multiplied by (b) the highest Closing Price for
the Common Stock during the period beginning on the date of first occurrence of
the Event of Default and ending one day prior to the Mandatory Prepayment Date
(the “Default Amount”) and all other amounts payable hereunder shall immediately
become due and payable, all without demand, presentment or notice, all of which
hereby are expressly waived, together with all costs, including, without
limitation, legal fees and expenses, of collection, and the Holder shall be
entitled to exercise all other rights and remedies available at low or in
equity.



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If the Borrower fails to pay the
Default Amount within five (5) business days of written notice that such amount
is due and payable, then the Holder shall have the right at any time, so long as
the Borrower remains in default (and so long and to the extent that there are
sufficient authorized shares), to require the Borrower, upon written notice, to
immediately issue, in lieu of the Default Amount, the number of shares of Common
Stock of the Borrower equal to the Default Amount divided by the Conversion
Price then in effect. 

            6.       
Prepayment. At any time that the Note remains outstanding, upon three business
days’ written notice (the “Prepayment Notice”) to the Holder, the Company may
pay 150% of the entire Outstanding Principal Amount of the Note plus any accrued
but unpaid Interest. If the Company gives written notice of prepayment, the
Holder continues to have the right to convert principal and interest on the Note
into Conversion Shares until three business days elapses from the Prepayment
Notice. 

            7.       
Anti-Dilution. If, at any time the Note is outstanding, the Issuer issues Common
Stock, or grants options or warrants, at a price per share that is less than the
Conversion Price on the date of such issuance or grant, the Conversion Price
will be adjusted to such lower price for the remainder of the term of the Note.


            8.       
The Company covenants that until all amounts due under this Note are paid in
full, by conversion or otherwise, unless waived by the Holder or subsequent
Holder in writing, the Company shall: 

give prompt written notice to the
Holder of any Event of Default or of any other matter which has resulted in, or
could reasonably be expected to result in a materially adverse change in its
financial condition or operations; 

give prompt notice to the Holder of any
claim, action or proceeding which, in the event of any unfavorable outcome,
would or could reasonably be expected to have a Material Adverse Effect (as
defined in the Note Purchase Agreement) on the financial condition of the
Company; 

at all times reserve and keep available
out of its authorized but unissued Common Stock, for the purpose of effecting
the conversion of this Note into Common Stock, such number of its duly
authorized shares of Common Stock as shall from time to time be sufficient to
effect the conversion of the Outstanding Principal Amount of this Note into
Common Stock. 

            9.       
Upon receipt by the Company of evidence from the Holder reasonably satisfactory
to the Company of the loss, theft, destruction or mutilation of this Note, 

(i) in the case of loss, theft or
destruction, upon provision of indemnity reasonably satisfactory to it and/or
its transfer agent, or 

(ii) in the case of mutilation, upon
surrender and cancellation of this Note, then the Company at its expense will
execute and deliver to the Holder a new Note, dated the date of the lost,
stolen, destroyed or mutilated Note, and evidencing the outstanding and unpaid
principal amount of the lost, stolen, destroyed or mutilated Note. 

            10.       
If any term in this Note is found by a court of competent jurisdiction to be
unenforceable, then the entire Note shall be rescinded, the consideration
proffered by the Holder for the remaining Debt acquired by the Holder not
converted by the Holder in accordance with this Note shall be returned in its
entirety and any Conversion Shares in the possession or control of the Investor
shall be returned to the Issuer. 

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            11.       
The Note and the Agreement between the Company and the Holder (including all
Exhibits thereto) constitute the full and entire understanding and agreement
between the Company and the Holder with respect to the subject hereof. Neither
this Note nor any term hereof may be amended, waived, discharged or terminated
other than by a written instrument signed by the Company and the Holder. 

           
12.        This Note shall be governed by and
construed in accordance with the internal laws of the State of New York. 

            13.       
Legal Opinion. The Issuer's counsel has provided an opinion regarding the
applicable exemption from registration under the Securities Act for the issuance
of the Conversion Shares pursuant to the terms and conditions of this Agreement
and the Note, which provides that upon conversion at any time following the date
hereof, the shares received as a result of the conversion shall be issued
unrestricted in accordance with the appropriate exemption. If the Issuer
declines to provide, or requests that Investor counsel prepare an opinion, the
Issuer agrees to bear the cost of the letter. 

            14.       
Conditions. The Issuer acknowledges the Investor's participation in respect to
this Agreement is on a conditions permitting basis. In the event that the
transaction risk profile substantially changes, market pricing or implied
volatility substantially change, due diligence raises concerns or any other
conditions material to the successful closing of the transaction change, the
Investor reserves the right to terminate the Agreement at any time before
delivering to the Non Affiliate Debtholder the cash consideration as described
hereof. 

            15.       
Post-Closing Expenses. The Issuer will bear any and all miscellaneous expenses
that may arise as a result of this Agreement post-closing. These expenses
include, but are not limited to, the cost of legal opinion production, transfer
agent fees, equity issuance fees, etc. The failure to pay any and all
Post-Closing Expenses will be deemed a default as described in Section 5.1.10
herein. 

           
16.        Miscellaneous 

	 	16.1. 	
      Counterparts. This Agreement may be executed in any
      number of counterparts by original, facsimile or email signature. All
      executed counterparts shall constitute one Agreement not withstanding that
      all signatories are not signatories to the original or the same
      counterpart. Facsimile and scanned signatures are considered original
      signatures.

	 	 	 
	 	16.2. 	
      Severability. This Agreement is not severable. If any
      term in this Agreement is found by a court of competent jurisdiction to be
      unenforceable, then the entire Agreement shall be rescinded, the
      consideration proffered by the Investor for the remaining Debt acquired by
      Investor not converted by the Investor in accordance with this Agreement
      shall be returned in its entirety and any Conversion Shares in the
      possession or control of the Investor shall be returned to the
    Issuer.

	 	 	 
	 	16.3. 	
      Legal Fees. Except as provided in Section 15 of this
      agreement, each Party will bear its own legal expenses in the execution of
      this Agreement. If the Issuer defaults and the Investor is required to
      expend funds for legal fees and expenses, such costs will be reimbursed to
      the Investor, solely by the Issuer.

	 	 	 
	 	16.4. 	
      Modification. This Agreement and the Note may only be
      modified in a writing signed by all Parties.



            IN
WITNESS WHEREOF, the Company has caused this instrument to be duly executed by
an officer thereunto duly authorized, as of the date first written above. 

AMERICAN PETRO-HUNTER, INC. 

/s/ Robert Mcintosh

Robert Mcintosh, CEO, President 

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Exhibit B. 

NOTICE OF CONVERSION 

      
     The undersigned hereby elects to convert $
principal amount of the Note (defined below) into Shares of Common Stock of
AMERICAN PETRO-HUNTER, INC., a(n) NEVADA Corporation (the “Borrower”)
according to the conditions of the convertible Notes of the Borrower dated
as of March 4, 2013 (the “Notes”), as of the date written below. No fee
will be charged to the Holder or Holder’s Custodian for any conversion, except
for transfer taxes, if any. 

Box Checked as to applicable instructions: 

	 	[   ] 	The Borrower shall electronically
      transmit the Common Stock issuable pursuant to this Notice of Conversion
      to the account of the undersigned or its nominee with DTC through its
      Deposit Withdrawal Agent Commission system (“DWAC Transfer”).

	 	  	  
	 	  	Name of DTC Prime Broker: 
	 	  	  
	 	  	Account Number: 
	 	  	  
	 	[   ] 	The undersigned hereby requests
      that the Borrower issue a certificate or certificates for the number of
      shares of Common Stock set forth below (which numbers are based on the
      Holder’s calculation attached hereto) in the name(s) specified immediately
      below: 
	 	  	  
	 	  	Magna Group, LLC 
	 	  	EIN #: 27-2162659




	 Date of Conversion: 	 	 
	  	 	 
	 Conversion Price: 	 	 
		 	 
	 Shares to Be Delivered: 	 	 
		 	 
	 Remaining Principal Balance Due 	 	 
	 After This Conversion: 	 	 
		 	 
		 	 
	 Signature 	 	 
		 	 
		 	 
		 	 
	 Print Name: 	 	 
		 	 
		 	 
		 	 


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