Document:

re4_3exh.htm

 

Exhibit 4.3

Form of Note

 

[Face of Note]

 

 

[THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO THE INDENTURE, (3) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO THE INDENTURE AND (4) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY IN ACCORDANCE WITH THE INDENTURE.

 

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]1

	
1 Insert if this is a Global Note.

  

CUSIP                 

ISIN                 

 

___% Notes due 20__

 

	
 No.         

	
  

	  	
$__________                    

	
  

 

ROYALE ENERGY, INC.

 

promises to pay to                     , or its registered assigns,

 

the principal sum of                                      DOLLARS of the United States of America[, or such greater or lesser amount as may from time to time be endorsed on the Schedule of Exchanges of Interests in the Global Note attached hereto,]2 on ______, 20__.

 

Interest Payment Dates: _____ and _____ of each year.

 

Record Dates: _____ and _____ of each year.

 

Reference is hereby made to the further provisions of this Note set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

  

  

  

 

Unless the certificate of authentication hereon has been duly executed by the Trustee referred to on the reverse hereof by manual signature, this Note shall not be entitled to any benefit of the Indenture or be valid or obligatory for any purpose.

 

Dated:                     

 

	
ROYALE ENERGY, INC.

	  	  
	
By:

	  	________________________________________
	  	  	
Name:

	  	  	
Title:

 

Certificate of Authentication:

 

This is one of the Notes referred to

in the within-mentioned Indenture:

 

	  	  	  
	
_____, as Trustee

	  	  
	
By:

	  	_________________________________________  
	  	  	
Authorized Officer

 

	
2 Insert if this is a Global Note.

 

  

  

  

 

[Reverse of Note]

 

___% Notes due 20_

 

Capitalized terms used herein have the meanings assigned to them in the Indenture referred to below unless otherwise indicated.

 

(1) INTEREST. Royale Energy, Inc., a California corporation (the "Company"), promises to pay or cause to be paid interest on the principal amount of this Note at __% per annum from _____. The Company will pay interest semi-annually in arrears on _____ and ______ of each year (each, an "Interest Payment Date"). Interest on the Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from _____; provided that, if this Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided further that the first Interest Payment Date shall be _____. The Company will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium (if any), at a rate equal to the then applicable interest rate on the Notes to the extent lawful; it will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest, if any, and any Additional Amounts (without regard to any applicable grace period) at the same rate to the extent lawful.  Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.

 

(2) METHOD OF PAYMENT. The Company will pay interest on the Notes (except defaulted interest) to the Persons who are registered Holders at the close of business on the _____ or _____ next preceding the Interest Payment Date, even if such Notes are canceled after such record date and on or before such Interest Payment Date, except as provided in the Indenture with respect to defaulted interest. The Notes will be payable as to principal, premium, if any, interest, if any, and Additional Amounts, if any, at the office or agency of the Paying Agent and Registrar within the City and State of New York, or, at the option of the Company, payment of interest may be made by wire transfer of immediately available funds for Global Notes or by check mailed to the Holders at their addresses set forth in the register of Holders. Such payment will be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. If a payment date is not a Business Day at a place of payment, payment may be made at that place on the next succeeding Business Day, and no interest shall accrue for the intervening period.

 

(3) PAYING AGENT AND REGISTRAR. Initially, _______, the Trustee under the Indenture, will act as Paying Agent and Registrar. The Company may change the Paying Agent or Registrar without prior notice to the Holders. The Company or any of its Subsidiaries may act as Paying Agent or Registrar.

 

(4) INDENTURE. The Company issued the Notes under the _____ Supplemental Indenture, dated as of _____, 20__ (the "Supplemental Indenture"), between the Company and _____, as Trustee (herein called the "Trustee", which term includes any successor trustee under the Indenture), to an Indenture, dated as of _____, 20__ (the "Base Indenture", as amended and supplemented by the Supplemental Indenture, and as further amended and supplemented from time to time, in each case, with respect to the Notes, the "Indenture'), between the Company and the Trustee. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the TIA. The Notes are subject to all such terms, and Holders are referred to the Indenture and such Act for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling. The Notes are unsecured obligations of the Company.

 

(5) OPTIONAL REDEMPTION.

 

(A) At any time prior to _____, 20__, the Company may on any one or more occasions redeem up to 35% of the aggregate principal amount of Notes issued under the Indenture at a redemption price equal to __% of the principal amount of the Notes redeemed, plus accrued and unpaid interest, if any, to the date of redemption (subject to the rights of Holders on the relevant record date to receive interest on the relevant Interest Payment Date), with the net cash proceeds of one or more equity offerings by the Company; provided that:

 

(1) at least 65% of the aggregate principal amount of the initial notes (excluding Notes held by the Company and its Subsidiaries) remains outstanding immediately after the occurrence of such redemption; and

 

(2) the redemption occurs within ___ days of the date of the closing of such equity offering.

 

(B) At any time prior to _____, 20__, the Company may on any one or more occasions redeem all or a part of the Notes at a redemption price equal to 100% of the principal amount of the Notes redeemed, plus the applicable premium as of, and accrued and unpaid interest, if any, to the applicable date of redemption, subject to the rights of Holders on the relevant record date to receive interest due on the relevant Interest Payment Date. The Company will (i) determine the treasury rate at least one Business Day prior to the redemption date and (ii) prior to such redemption

  

  

  

 

date file with the Trustee an Officers' Certificate setting forth the applicable premium and the treasury rate and showing the calculation of each in reasonable detail.

 

(C) On or after _____, 20__, the Company may on any one or more occasions redeem all or a part of the Notes at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest, if any, on the Notes redeemed, to the applicable redemption date, if redeemed during the twelve-month period beginning on _____ of the years indicated below, subject to the rights of Holders on the relevant record date to receive interest on the relevant Interest Payment Date:

 

	  	  	  	  	  
	

Year

	
  

	
                                                                Percentage

 

	
20__

	
  

	  	
­­­­­_____

	
% 

	
20__

	
  

	  	
_____

	
% 

	
20__ and thereafter

	
  

	  	
_____

	
% 

 

(D) The Company may redeem the Notes, in whole but not in part, at its discretion at any time upon giving not less than 30 nor more than 60 days' prior notice to the Holders (which notice will be irrevocable and given in accordance with the Indenture), at a redemption price equal to 100% of the principal amount thereof, together with accrued and unpaid interest, if any, to the date fixed by the Company for redemption (a "Tax Redemption Date") and all Additional Amounts, if any, then due and which will become due on the Tax Redemption Date as a result of the redemption or otherwise (subject to the rights of Holders on the relevant record date to receive interest due on the relevant Interest Payment Date and Additional Amounts, if any, in respect thereof), if on the next date on which any amount would be payable in respect of the Notes, the Company is or would be required to pay Additional Amounts, and the Company cannot avoid any such payment obligation by taking reasonable measures available (including, for the avoidance of doubt, the appointment of a new Paying Agent), and the requirement arises as a result of:

 

(1) any change in, or amendment to, the laws (or any regulations or rulings promulgated thereunder) of the relevant tax jurisdiction affecting taxation, which change or amendment has not been publicly announced before and which becomes effective on or after the date on which the tax jurisdiction imposing the relevant withholding or deduction became the applicable tax jurisdiction under the Indenture; or

 

(2) any change in, or amendment to, the existing official position regarding the application, administration or interpretation of such laws, regulations or rulings (including a holding, judgment or order by a court of competent jurisdiction or a change in published practice), which change, amendment, application or interpretation has not been publicly announced before and becomes effective on or after the date on which the tax jurisdiction imposing the relevant withholding or deduction became the applicable tax jurisdiction under the Indenture).

 

(E) In the event that not less than 90% of the aggregate principal amount of the then outstanding Notes are properly tendered and not withdrawn under a Change of Control Offer (as defined in Section 7(a) below) and the Company purchases all of such Notes, the Company will have the right, upon not less than 30 nor more than 60 days' prior notice, given not more than 30 days following the change of control purchase date, to redeem all of the Notes that remain outstanding following such purchase at a redemption price equal to the Change of Control Payment (as defined in Section 7(a) below) plus, to the extent not included in the Change of Control Payment, accrued and unpaid interest on the Notes that remain outstanding, to the date of redemption (subject to the right of holders of record on the relevant record date to receive interest due on the relevant Interest Payment Date).

 

(F) Unless the Company defaults in the payment of the redemption price, interest will cease to accrue on the Notes or portions thereof called for redemption on the applicable redemption date.

 

(6) MANDATORY REDEMPTION. _______________________________________________________________.

 

(7) REPURCHASE AT THE OPTION OF HOLDER. Subject to the additional terms and conditions set forth in the Indenture:

  

  

  

 

(A) If there is a change of control, the Company will be required to make an offer (a "Change of Control Offer") to each Holder to repurchase all or any part (equal to $1,000 or an integral multiple of $1,000 in excess thereof) of that Holder's Notes at a purchase price in cash (the "Change of Control Payment") equal to 101% of the aggregate principal amount of Notes repurchased, plus accrued and unpaid interest, if any, on the Notes repurchased to the change of control purchase date, subject to the rights of Holders on the relevant record date to receive interest due on the relevant Interest Payment Date. Within 30 days following any change of control, the Company will mail a notice to each Holder setting forth the procedures governing the Change of Control Offer as required by the Indenture.

(B) If the Company or a restricted subsidiary of the Company consummates any asset sales, within five days of each date on which the aggregate amount of excess proceeds exceeds $__ million (the “Excess Proceeds”), the Company will make an asset sale offer (an “Asset Sale Offer”), in accordance with the Indenture, to all Holders and all holders of other Indebtedness that is pari passu with the Notes containing provisions similar to those set forth in the Indenture with respect to offers to purchase, prepay or redeem with the proceeds of sales of assets to purchase, prepay or redeem the maximum principal amount of Notes and such other pari passu Indebtedness (plus all accrued interest on the Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith) that may be purchased, prepaid or redeemed out of the Excess Proceeds. The offer price in any Asset Sale Offer will be equal to 100% of the principal amount, plus accrued and unpaid interest, if any, to the date of purchase, prepayment or redemption, subject to the rights of Holders on the relevant record date to receive interest due on the relevant Interest Payment Date, and will be payable in cash. If any Excess Proceeds remain after consummation of an Asset Sale Offer, the Company may use those Excess Proceeds for any purpose not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes and other pari passu Indebtedness tendered in (or required to be prepaid or redeemed in connection with) such Asset Sale Offer exceeds the amount of Excess Proceeds, the Company will select the Notes and such other pari passu Indebtedness to be purchased on a pro rata basis (except that any Notes represented in global form will be selected by such method as the Depositary or its nominee or successor may require or, where the nominee or successor is the Trustee, a method that most nearly approximates pro rata selection as the Trustee deems fair and appropriate), based on the amounts tendered or required to be prepaid or redeemed (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of $1,000, or an integral multiple of $1,000 in excess thereof, will be purchased). Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero. Holders that are the subject of an offer to purchase will receive an Asset Sale Offer from the Company prior to any related purchase date and may elect to have such Notes purchased by completing the form entitled "Option of Holder to Elect Purchase" attached to the Notes.

 

(8) NOTICE OF REDEMPTION. At least 30 days but not more than 60 days before a redemption date, the Company will mail or cause to be mailed, by first-class mail, a notice of redemption to each Holder whose Notes are to be redeemed at its registered address. Notes and portions of Notes selected will be in amounts of $1,000 or whole multiples of $1,000 in excess thereof, except that if all of the Notes of a Holder are to be redeemed or purchased, the entire outstanding amount of Notes held by such Holder shall be redeemed or purchased. No Notes of $1,000 or less in principal amount can be redeemed in part.

 

(9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form in denominations of $1,000 and integral multiples of $1,000 in excess thereof. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. The Company need not exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Company need not exchange or register the transfer of any Notes for a period of 15 Business Days prior to the mailing of notice of any offer to repurchase the Notes.

 

(10) PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated as the owner of it for all purposes. Only registered Holders have rights under the Indenture.

 

(11) AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the Indenture or the Notes may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the then outstanding Notes (including additional notes, if any) voting as a single class, and any existing Default or Event of Default (other than (i) a Default or Event of Default in the payment of the principal of, or premium, if any, or interest, if any, on, or any Additional Amounts with respect to the Notes or (ii) a Default in respect of a provision that under the Indenture cannot be amended or supplemented without the consent of each Holder affected) or compliance with any provision of the Indenture or the Notes may be waived with the consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes (including additional notes, if any) voting as a single class. Without the consent of any Holder, the Indenture or the Notes may be amended or supplemented to cure any ambiguity, defect or inconsistency, to provide for uncertificated Notes in addition to or

  

  

  

in place of certificated Notes, to provide for the assumption of the Company's obligations to Holders of the Notes in the case of a merger or consolidation or sale of all or substantially all of the Company's assets, as applicable, in accordance with the Indenture, to make any change that would provide any additional rights or benefits to the Holders or that does not adversely affect the legal rights under the Indenture of any Holder, to comply with the requirements of the SEC in order to effect or maintain the qualification of the Indenture under the TIA, to conform the text of the Indenture or the Notes to any provision of the "Description of Notes" section of the Company's Prospectus dated _____, 20__, as filed with the SEC on _____, 20__, relating to the initial offering of the Notes, to the extent that such provision in that "Description of Notes" was intended to be a substantially verbatim recitation of a provision of the Indenture or the Notes, which intent may be evidenced by an Officers' Certificate to that effect, to provide for the issuance of additional notes in accordance with the limitations set forth in the Indenture as of the Issue Date, or to evidence or provide for the acceptance of appointment under the Indenture of a successor Trustee.

 

(12) DEFAULTS AND REMEDIES. Events of Default include: (i) default for 30 days in the payment when due of interest, if any, or any Additional Amounts, on, the Notes; (ii) default in the payment when due (at maturity, upon redemption or otherwise) of the principal of, or premium, if any, on the Notes, (iii) failure by the Company or any of its restricted subsidiaries to comply with certain provisions of the Indenture relating to merger, consolidation or sale of assets or to consummate a purchase of Notes when required pursuant to the Indenture; (iv) failure by the Company or any of its restricted subsidiaries for 60 days after notice to the Company by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding voting as a single class to comply with any other agreements in the Indenture; (v) default under certain other agreements relating to certain indebtedness of the Company or any of its restricted subsidiaries which default is a payment default or results in the acceleration of such Indebtedness prior to its express maturity; (vi) certain events of bankruptcy or insolvency with respect to the Company or any of its restricted subsidiaries that is a significant subsidiary or any group of restricted subsidiaries that, taken together, would constitute a significant subsidiary. In the case of an Event of Default arising from certain events of bankruptcy or insolvency described in clause (vi), all outstanding Notes will become due and payable immediately without further action or notice. If any other Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of the then outstanding Notes may declare all the Notes to be due and payable immediately. Holders may not enforce the Indenture or the Notes except as provided in the Indenture. Subject to certain limitations, Holders of a majority in aggregate principal amount of the then outstanding Notes may direct the time, method and place of conducting any proceeding for exercising any remedy available to the Trustee or exercising any trust or power conferred on it. The Trustee may withhold from Holders notice of any Default or Event of Default (except a Default or Event of Default relating to the payment of principal, premium, if any, interest, if any, or Additional Amounts, if any, on the Notes) if and so long as a committee of Responsible Officers of the Trustee in good faith determines that withholding notice is in the interests of the Holders. The Holders of a majority in aggregate principal amount of the then outstanding Notes by written notice to the Trustee may, on behalf of all the Holders, waive an existing Default or Event of Default and its consequences under the Indenture, except (i) a continuing Default or Event of Default in the payment of principal of, or premium, if any, or interest, if any, on, or any Additional Amounts with respect to the Notes (including in connection with an Asset Sale Offer or Change of Control Offer) and (ii) a Default in respect of a provision that under the Indenture cannot be amended or supplemented without the consent of each Holder affected. The Holders of a majority in aggregate principal amount of the then outstanding Notes by written notice to the Trustee may, on behalf of the Holders of all the Notes, rescind an acceleration and its consequences under the Indenture, if the rescission would not conflict with any judgment or decree, if all existing Events of Default (except nonpayment of principal of, premium, if any, interest, if any, on, or any Additional Amounts with respect to the Notes that has become due solely because of the acceleration) have been cured or waived and if the Company has paid or deposited certain amounts with the Trustee. The Company is required to deliver to the Trustee annually a statement regarding compliance with the Indenture, and the Company is required, upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default.

 

(13) TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not the Trustee.

 

(14) NO RECOURSE AGAINST OTHERS. No director, officer, employee, incorporator or shareholder of the Company, as such, will have any liability for any obligations of the Company under the Notes, the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. The waiver may not be effective to waive liabilities under the federal securities laws.

 

                (15) AUTHENTICATION. This Note will not be valid until authenticated by the manual signature of the Trustee or an authenticating agent.

  

  

  

 

                (16) ABBREVIATIONS. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

 

(17) CUSIP NUMBERS. Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the Notes, and the Company may use CUSIP numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption, and reliance may be placed only on the other identification numbers placed thereon.

 

(18) GOVERNING LAW. THE SUPPLEMENTAL INDENTURE, THE INDENTURE AND THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT THE LAWS  OF THE STATE OF NEW YORK REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

 

The Company will furnish to any Holder upon written request and without charge a copy of the Indenture. Requests may be made to:

 

Royale Energy, Inc.

7676 Hazard Center Drive, Suite 1500

San Diego, California 92108

Attention: General Counsel

 

  

  

  

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

	  	  	  
	
(I) or (we) assign and transfer this Note to:

	
  

	  
	  	
  

	
(Insert assignee's legal name)

	  
	  
	
(Insert assignee's soc. sec. or tax I.D. no.)

	  
	  
	  
	  
	  
	  
	  
	  
	  
	
(Print or type assignee's name, address and zip code)

 

and irrevocably appoint _____________________________________________________________________________________ to transfer this Note on the books of the Company. The agent may substitute another to act for him.

 

Date: __________________

 

	  	  	  
	  	  
	
Your Signature:

	  	  
	
(Sign exactly as your name appears on the face of this Note)

 

Signature Guarantee*: ________________________________

 

	
*

	
Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee).

 

  

  

  

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you want to elect to have this Note purchased by the Company pursuant to Section ____ or ____ of the Indenture, check the appropriate box below:

 

o Section ____    o Section _____

 

If you want to elect to have only part of the Note purchased by the Company pursuant to Section ____ or Section ____ of the Indenture, state the amount you elect to have purchased (must be a minimum of $1,000 or an integral multiple of $1,000 in excess thereof):

 

$_____________

 

Date: _______________

 

	  	  	  
	  	  
	
Your Signature:

	  	  
	
(Sign exactly as your name appears on the face of this Note)

	  
	
Tax Identification No.: ________________________

 

Signature Guarantee*: ___________________________

 

	
*

	
Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee).

 

  

  

  

 

SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE *

 

The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Note, or exchanges of a part of another Global Note or Definitive Note for an interest in this Global Note, have been made:

 

	

Date of Exchange

	

Amount of decrease in Principal Amount of this Global Note

	

Amount of increase in Principal Amount of this Global Note

	

Principal Amount of this Global Note following such decrease (or increase)

	

Signature of Authorized signatory of Trustee or Note Custodian

 

	
*  This schedule should be included only if the Note is issued in global form.Exhibit 10.1

                   AGREEMENT TO TERMINATE DEFINITIVE AGREEMENT

This agreement is made and entered into this 23th day of January, 2012 by and
between Domark International, Inc. (the Company), and Silk for Less, Inc., a
Florida corporation (Silk).

Whereas, on June 3, 2011, the Company executed an Agreement for the Exchange of
Common Stock with Silk providing for the issuance of convertible preferred stock
of the Company in exchange for all of the outstanding shares of Silk. The
closing of the transaction was subject to and wholly conditioned upon the
completion of due diligence and the delivery of documents by both parties,
including but not limited to the completion and delivery of an audit of the
books and records of Silk by a PCAOB member firm acceptable to the Company, and

Whereas, the parties to the agreement desire to mutually terminate the Agreement
of June 3, 2011.

Now therefore, for valuable consideration, the receipt of which is hereby
acknowledged, the parties agree as follows:

1. Effective this date, the parties hereto agree to mutually terminate the
agreement of June 3, 2011.

2. All property belonging to each party in the possession of the other party
will be immediately returned upon execution of this agreement.

3. The parties hereby release each other of any and all claims of any kind or
nature, and neither party shall be liable or responsible to the other party for
any matters arising out of the June 3, 2011 agreement.

In witness hereof, this agreement is executed at Orlando, Florida as of the day
and year written above.

DOMARK INTERNATIONAL, INC.                 SILK FOR LESS, INC.

/s/ R. Thomas Kidd                         /s/ Luis Cardena
----------------------------------         -------------------------------------
R. Thomas Kidd                             Luis Cardena

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