Unassociated Document


    EXHIBIT
4.1

    


    NEITHER
THE ISSUANCE AND SALE OF THIS NOTE NOR THE SECURITIES INTO WHICH THIS NOTE IS
CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR APPLICABLE STATE SECURITIES LAWS.  THE SECURITIES MAY NOT BE OFFERED FOR
SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF (I) AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR (II) AN OPINION OF COUNSEL, IN A FORM REASONABLY ACCEPTABLE TO THE
COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT.  NOTWITHSTANDING
THE FOREGOING, THIS NOTE MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THIS NOTE.  ANY
TRANSFEREE OF THIS NOTE SHOULD CAREFULLY REVIEW THE TERMS OF THIS NOTE.
 THE PRINCIPAL AMOUNT REPRESENTED BY THIS NOTE AND, ACCORDINGLY, THE
SECURITIES ISSUABLE UPON CONVERSION HEREOF MAY BE LESS THAN THE AMOUNTS SET
FORTH ON THE FACE HEREOF PURSUANT TO THIS NOTE.

    


    EASTERN
RESOURCES, INC.

    8.25%
CONVERTIBLE PROMISSORY NOTE

    


    
      	
              Issuance
      Date:  May 8, 2009

            	
              Principal
      Amount: U.S. $45,000.00

            


    

    


    FOR VALUE
RECEIVED, Eastern
Resources, Inc., a Delaware corporation (the "Company"), hereby promises to
pay to MILESTONE ENHANCED FUND
LTD. or registered assigns ("Holder") the amount set out
above as the Original Principal Amount (as reduced pursuant to the terms hereof
pursuant to redemption, conversion or otherwise, the "Principal") when due, whether
upon the Maturity Date (as defined below), acceleration, redemption or otherwise
(in each case in accordance with the terms hereof) and to pay interest at the
rate of 8.25% per annum  ("Interest") from the date set
out above as the Issuance Date (the "Issuance Date") until the same
becomes due and payable on the Maturity Date.

    


    1.           PAYMENTS OF PRINCIPAL;
MATURITY.  Payment of principal and interest due on this Note is
payable no later than November 8, 2010 (the “Maturity Date”); provided, however,
that each of the parties hereto may mutually agree to extend the term of this
Note beyond the Maturity Date.

    


    2.           PREPAYMENT.  The
Company and the Holder understand and agree that the principal amount of the
Note and any interest accrued thereon be prepaid by the Company at any time
without penalty.

    


    3.           CONVERSION OF NOTE.
 This Note shall be convertible into shares of the Company’s common stock
(the "Shares"), on the
terms and conditions set forth in this Section 3.

    


    (a)           Conversion Right.
 Subject to the provisions of Section 3(c)(i) hereof and pursuant to terms
to be mutually agreed upon by the Company and the Holder in writing at a later
date, the Holder shall be entitled to convert any portion of the outstanding and
unpaid principal and interest balance due on the Note in accordance with Section
3 of this Note into Shares at a conversion price to be mutually determined by
the Company and the Holder (the “Conversion
Price”).   The Company shall not issue any fractions of a
Share upon any conversion.  If the issuance would result in the issuance of
a fraction of a Share, the Company shall round such fraction of a Share up to
the nearest whole Share.  The Company shall pay any and all taxes that may
be payable with respect to the issuance and delivery of Shares upon conversion
of any conversion amount.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    (b)           Mechanics of
Conversion.

     

    (i) Notice of
Conversion. To convert
this Note, the Holder hereof shall deliver written notice thereof, substantially
in the form of Exhibit A to
this Note, with appropriate insertions (the “Conversion Notice”),
to the Company at its address as set forth herein.  The date upon
which the conversion shall be effective (the “Conversion Date”)
shall be deemed to be the date set forth in the Conversion
Notice.  Except as otherwise provided herein, the Company shall not
have the right to object to the conversion or the calculation of the applicable
conversion price, absent manifest error.  Any conversion of any
portion of the Note to Shares shall be deemed to be a pre-payment of principal,
without any penalty, and shall be credited against any future payments of
principal in the order that such payments become due and payable

    


    (ii) Disputes.  In the event of a dispute as to the number of Shares
issuable to the Holder in connection with a conversion of this Note, the Company
shall issue to the Holder the number of Shares not in dispute and resolve such
dispute using good faith efforts with the Holder.

    


    (c)           Limitations on
Conversions. 

    


    Beneficial Ownership.
 The Holder of this Note (including any successor, transferee or assignee)
shall not have the right or obligation to convert any portion of this Note
pursuant to Section 3(b)(i) hereof to the extent that, after giving effect to
such conversion, the Holder (together with the Holder's Affiliates) would
beneficially own in excess of 4.99% (as may be adjusted in the manner described
below, the "Maximum
Percentage") of the number of shares of Common Stock outstanding
immediately after giving effect to such conversion.  For purposes of the
foregoing sentence, the number of shares of Common Stock beneficially owned by
the Holder and its Affiliates shall include the number of shares of Common Stock
issuable upon conversion of this Note with respect to which the
determination of such sentence is being made, but shall exclude the number of
shares of Common Stock which would be issuable upon (A) conversion of the
remaining, nonconverted portion of this Note beneficially owned by the Holder or
any of its Affiliates and (B) exercise or conversion of the unexercised or
nonconverted portion of any other securities of the Company (including, without
limitation, any Other Notes or Warrants) subject to a limitation on conversion
or exercise analogous to the limitation contained herein beneficially owned by
the Holder or any of its Affiliates.  Except as set forth in the preceding
sentence, for purposes of this Section 3(c), beneficial ownership shall be
calculated in accordance with Section 13(d) of the Securities Exchange Act of
1934, as amended.  For purposes of this Section 3(c), in determining the
number of outstanding shares of Common Stock, the Holder may rely on the number
of outstanding shares of Common Stock as reflected in the most recently filed
document among: (x) the Company's most recent public filing with the Securities
and Exchange Commission containing such information, (y) a more recent public
announcement by the Company or (z) any other notice by the Company or the
Transfer Agent setting forth the number of shares of Common Stock outstanding.
 For any reason at any time, during regular business hours of the Company
and upon the written request of the Holder, the Company shall within two (2)
Business Days confirm in writing to the Holder the number of shares of Common
Stock then outstanding.  In any case, the number of outstanding shares of
Common Stock shall be determined after giving effect to the conversion or
exercise of securities of the Company, including this Note, by the Holder or its
Affiliates since the date as of which such number of outstanding shares of
Common Stock was reported.  By written notice to the Company, the Holder
may increase or decrease the Maximum Percentage to any other
percentage specified in such notice; provided that (i) any such increase
will not be effective until the sixty-first (61st ) day
after such notice is delivered to the Company, (ii) any such increase or
decrease will apply only to the Holder and not to any other holder of Notes, and
(iii) such Maximum Percentage shall not, in any event, exceed
19.99%.

     

    
      
        
        

      

      
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    4.           EVENT OF
DEFAULT.  Failure by the Company to make payment pursuant to
Section 1 hereof shall constitute an event of default (“Event of
Default”).  In an Event of Default, the Holder shall be entitled to
all legal remedies available to it to pursue collections, and the Company shall
bear all reasonable costs of collection, including but not limited to necessary
attorneys’ fees.

    


    5.           NO
WAIVER.  No failure or delay by the Holder in exercising any
right, power or privilege under this Note shall operate as a waiver thereof nor
shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or
privilege.  The rights and remedies herein provided shall be
cumulative and not exclusively of any rights or remedies provided by applicable
law.  No course of dealing between the Company and the Holder shall
operate as a waiver of any rights by the Holder.

    


    6.           NOTICES;
PAYMENTS.

    


    (a)           Notices.
 Whenever notice is required to be given under this Note, unless otherwise
provided herein, such notice shall be given in accordance with the Securities
Purchase Agreement.  Unless a specific notice is otherwise required
under this Note, the Company shall provide the Holder with prompt written notice
of all actions taken pursuant to this Note, including in reasonable detail a
description of such action and the reason therefore.

    


    (b)           Payments.  Except as
otherwise provided in this Note, whenever any payment of cash is to be made by
the Company to the Holder, such payment shall be made in lawful money of the
United States of America by a check drawn on the account of the Company and sent
via overnight courier service to the Holder at such address as previously
provided to the Company in writing (which address shall be set forth in the
Securities Purchase Agreement); provided that the Holder may elect to receive a
payment of cash via wire transfer of immediately available funds by providing
the Company with prior written notice setting out such request and the Holder's
wire transfer instructions.  Whenever any amount expressed to be due by the
terms of this Note is due on any day which is not a Business Day, the same
shall instead be due on the next succeeding day which is a Business
Day.

     

    
      
        
        

      

      
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    7.           TRANSFER.  The
Holder acknowledges and agrees that this Note may only be offered, sold,
assigned or transferred by the Holder if consented to in writing by the
Company.

    


    8.           CONSTRUCTION;
HEADINGS.  This Note shall be deemed to be jointly drafted by the
Company and the Holder and shall not be construed against any person as the
drafter hereof.

    The
headings of this Note are for convenience of reference and shall not form part
of, or affect the interpretation of, this Note.

    


    9.           SEVERABILITY.  In
the event that one or more of the provisions of this Note shall for any reasons
be held invalid, illegal, or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision of this
Note, but this Note shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein.

    


    10.           GOVERNING LAW.  This
Note and the rights and obligations of the Company and the Holder shall be
governed by and construed in accordance with the laws of the State of New
York.

    


    [SIGNATURE
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    IN
WITNESS WHEREOF, the Company has caused this Note to be duly executed as of the
Issuance Date set out above.

     

    
      
        	 	
                EASTERN
      RESOURCES, INC.

              	 
	 	 	 	 
	
              	
                By:
      

              	/s/ Thomas
      H. Hanna, Jr.	 
	 	 	Name:
      Thomas H. Hanna, Jr. 	 
	 	 	Title:
      Chief Executive Officer 	 
	 	 	 	 


      

    

     

    
      
         


      

      
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         EXHIBIT
A

     

    NOTICE OF
CONVERSION

     

    (To
be executed by the Holder in order to convert the Note)

     

    
      	
              TO:

            	 
      


    

    


    The
undersigned hereby irrevocably elects to convert $ of the principal amount of
the above Note into Shares of Common Stock of Eastern Resources, Inc., according
to the conditions stated therein, as of the Conversion Date written
below.

     

    
      	
              Conversion
      Date:

            	 	 	 
	
              Applicable
      Conversion Price:

            	 	 	 
	
              Signature:

            	 	 	 
	
              Name:

            	 	 	 
	
              Address:

            	 	 	 
	
              Amount
      to be converted:

            	 	$	 	 
	
              Amount
      of Note unconverted:

            	 	$	 	 
	
              Conversion
      Price per Unit:

            	 	$	 	 
	
              Number
      of shares of Common Stock and Warrants to be issued including as payment
      of interest, if applicable:

            	 	 	 	 
	
              Please
      issue the shares of Common Stock and Warrants in the following name and to
      the following address:

            	 	 	 	 
	
              Issue
      to the following account of the Holder:

            	 	 	 	 
	
              Authorized
      Signature:

            	 	 	 	 
	
              Name:

            	 	 	 	 
	
              Title:

            	 	 	 	 
	
              Phone
      Number:

            	 	 	 	 
	
              Broker
      DTC Participant Code:

            	 	 	 	 
	
              Account
      Number:

            	 	 	 	 


    

     


    
      
         


      

      
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