Document:

Exhibit 10.1

 

NOTE PURCHASE AGREEMENT

 

THIS NOTE
PURCHASE AGREEMENT (this “Agreement”) is dated as of March 15, 2016 (the “Agreement Date”),
by and between OMAGINE, INC., a corporation organized and existing under the laws of the State of Delaware (the “Company”),
and YA II PN, LTD (p/k/a, YA GLOBAL MASTER SPV, LTD.), a Cayman Islands exempt limited liability company (the “Investor”).

WITNESSETH

 

WHEREAS, the
parties desire that, upon the terms and subject to the conditions contained herein, the Company may issue and sell to the Investor,
as provided herein, and the Investor shall purchase a note substantially in the form attached hereto as Exhibit A (the “Note”)
in an aggregate principal amount of $600,000;

NOW, THEREFORE,
in consideration of the mutual covenants and other agreements contained in this Agreement the Company and the Investor hereby agree
as follows:

1.     
PURCHASE AND SALE OF NOTE;

(a)               
Purchase of Note. On the first business day following the satisfaction of all of the conditions precedent set forth
below (the “Closing Date”), the Company shall sell, and the Investor shall purchase, a Note in the principal
amount of $600,000 on the terms and conditions and in reliance on the Company’s representations and warranties, all as set
forth herein. The Note shall be in the form attached hereto as Exhibit A.

(b)              
Form of Payment. Subject to the satisfaction of the terms and conditions of this Agreement, on the Closing Date,
(i) the Investor shall deliver to the Company the principal amount of the Note to be issued and sold to the Investor; provided,
however, that the Investor shall deduct a commitment fee in the amount of $60,000.00 from the proceeds of the Note (to be payable
to YA Global II SPV LLC as designee of the Investor) and any other deductions of payments to be made on behalf of the Company as
agreed upon between the parties and set out on a signed closing statement (the “Closing Statement”), and (ii)
the Company shall deliver to the Investor, the Note duly executed on behalf of the Company.

(c)               
Conditions Precedent. The obligation of the Investor hereunder to purchase the Note pursuant hereto is subject to
the satisfaction, at or before the Closing Date, of each of the following conditions, provided that these conditions are for the
Investor’s sole benefit and may be waived by the Investor at any time in its sole discretion:

(i)                
There shall not have been any condition, circumstance, or situation that has resulted in or would reasonably be expected
to result in a “Material Adverse Effect,” where “Material Adverse Effect” shall mean any condition, circumstance,
or situation that may result in, or reasonably be expected to result in (1) a material adverse effect on the legality, validity
or enforceability of this Agreement or the transactions contemplated herein, (2) a material adverse effect on the results of operations,
assets, business or condition (financial or otherwise) of the Company, taken as a whole, or (3) a material adverse effect on the
Company’s ability to perform in any material respect on a timely basis its obligations under this Agreement

    	 	1	 

    	 

    

 

(ii)              
The Company’s common stock (“Common Stock”) shall be authorized for quotation or trading on the
NASDAQ Stock Market, the NYSE Euronext, the New York Stock Exchange, or the OTCQX, OTCQB, or OTC Pink marketplaces of the OTC Markets
Group, whichever is at the time the principal trading exchange or market for the Common Stock (the “Principal Market”)
and trading in the Common Stock shall not have been suspended for any reason;

(iii)            
The Company is not in material default nor aware of any potential material default with any of its lenders, except as has
been disclosed in the Company’s filings with the United States Securities and Exchange Commission (the “SEC”);

(iv)            
The Company has received all necessary authorizations to sell the Note to the Investor; and

(v)              
The parties have signed a Closing Statement in an agreed upon form.

(d)              
In the event that the Closing Date has not occurred by April 15, 2016, the Investor may terminate this Agreement.

 

2.     
INVESTOR’S REPRESENTATIONS AND WARRANTIES.

Investor hereby represents
and warrants to the Company that the following are true and correct as of the date hereof, and as of the Closing Date:

(a)               
Organization and Authorization. The Investor is duly organized, validly existing and in good standing under the laws
of the Cayman Islands and has all requisite power and authority to purchase and hold the Note. The decision to invest and the execution
and delivery of this Agreement by such Investor, the performance by such Investor of its obligations hereunder and the consummation
by such Investor of the transactions contemplated hereby have been duly authorized and requires no other proceedings on the part
of the Investor. The undersigned has the right, power and authority to execute and deliver this Agreement and all other instruments
on behalf of the Investor. This Agreement has been duly executed and delivered by the Investor and, assuming the execution and
delivery hereof and acceptance thereof by the Company, will constitute the legal, valid and binding obligations of the Investor,
enforceable against the Investor in accordance with its terms.

(b)              
Evaluation of Risks. The Investor has such knowledge and experience in financial, tax and business matters as to
be capable of evaluating the merits and risks of, and bearing the economic risks entailed by, an investment in the Company and
of protecting its interests in connection with this transaction. It recognizes that its investment in the Company involves a high
degree of risk.

(c)               
Investment Purpose. The Note is purchased by the Investor for its own account, and for investment purposes. The Investor
agrees not to assign or in any way transfer the Investor’s rights to the Note or any interest therein and acknowledges that
the Company will not recognize any purported assignment or transfer of the Note except in accordance with applicable Federal and
state securities laws. No other person has or will have a direct or indirect beneficial interest in the Note. The Investor agrees
not to sell, hypothecate or otherwise transfer the Note unless the Note is registered under Federal and applicable state securities
laws or unless, in the opinion of counsel satisfactory to the Company, an exemption from such laws is available.

    	 	2	 

    	 

    

 

(d)              
Accredited Investor. The Investor is an “Accredited Investor” as that term is defined in Rule
501(a)(3) of Regulation D of the Securities Act of 1933 (the “Securities Act”).

(e)               
Information. The Investor and its advisors (and its counsel), if any, have been furnished with all materials relating
to the business, finances and operations of the Company and information it deemed material to making an informed investment decision.
The Investor and its advisors, if any, have been afforded the opportunity to ask questions of the Company and its management. Neither
such inquiries nor any other due diligence investigations conducted by such Investor or its advisors, if any, or its representatives
shall modify, amend or affect the Investor’s right to rely on the Company’s representations and warranties contained
in this Agreement. The Investor understands that its investment involves a high degree of risk. The Investor has sought such accounting,
legal and tax advice, as it has considered necessary to make an informed investment decision with respect to this transaction.

(f)               
No General Solicitation. Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf,
has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D under the Securities
Act) in connection with the offer or sale of the Note offered hereby.

(g)              
Not an Affiliate. The Investor is not an officer, director or a person that directly, or indirectly through one or
more intermediaries, controls or is controlled by, or is under common control with the Company or any “Affiliate”
of the Company (as that term is defined in Rule 405 of the Securities Act).

 

3.     
COMPANY’S REPRESENTATIONS AND WARRANTIES. Except as stated below or in the SEC Documents (as defined below),
the Company hereby represents and warrants to, the Investor that the following are true and correct as of the date hereof, and
as of the Closing Date:

(a)               
Organization and Qualification. The Company is duly incorporated, validly existing and in good standing under the
laws of the State of Delaware and has all requisite corporate power to own its properties and to carry on its business as now being
conducted. Each of the Company and its subsidiaries is duly qualified as a foreign corporation to do business and is in good standing
in every jurisdiction in which the nature of the business conducted by it makes such qualification necessary, except to the extent
that the failure to be so qualified or be in good standing would not have a Material Adverse Effect on the Company and its subsidiaries
taken as a whole. The Company has furnished or made available to the Investor true and correct copies of the Company’s Re-Stated
Certificate of Incorporation as in effect on the date hereof (the “Certificate of Incorporation”), and the Company’s
By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or
exercisable for Common Stock and the material rights of the holders thereof in respect thereto.

(b)              
Authorization, Enforcement, Compliance with Other Instruments. (i) The Company has the requisite corporate power
and authority to enter into and perform this Agreement and any related agreements, in accordance with the terms hereof and thereof,
(ii) the execution and delivery of this Agreement and any related agreements by the Company and the consummation by it of the transactions
contemplated hereby and thereby, have been duly authorized by the Company’s Board of Directors and no further consent or
authorization is required by the Company, its Board of Directors or its stockholders, (iii) this Agreement, the Note (when
issued) and any related agreements have been duly executed and delivered by the Company, (iv) this Agreement, the Note (when issued),
and any related agreements, constitute the valid and binding obligations of the Company enforceable against the Company in accordance
with their terms, except as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or affecting generally, the enforcement of creditors’
rights and remedies.

    	 	3	 

    	 

    

 

(c)               
No Conflict. The execution, delivery and performance of this Agreement by the Company and the consummation by the
Company of the transactions contemplated hereby will not (i) result in a violation of the Certificate of Incorporation, any certificate
of designations of any outstanding series of preferred stock of the Company or By-laws or (ii) conflict with or constitute a default
(or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company or any of its subsidiaries
is a party, or result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities
laws and regulations and the rules and regulations of the Principal Market on which the Common Stock is quoted) applicable to the
Company or any of its subsidiaries or by which any material property or asset of the Company or any of its subsidiaries is bound
or affected and which would cause a Material Adverse Effect. Except as disclosed in the SEC Documents (as defined below), neither
the Company nor its subsidiaries is in violation of any term of or in default under its Articles of Incorporation or By-laws or
their organizational charter or by-laws, respectively, or any material contract, agreement, mortgage, indebtedness, indenture,
instrument, judgment, decree or order or any statute, rule or regulation applicable to the Company or its subsidiaries. The business
of the Company and its subsidiaries is not being conducted in violation of any material law, ordinance, regulation of any governmental
entity. Except as specifically contemplated by this Agreement and as required under the Securities Act and any applicable state
securities laws, the Company is not required to obtain any consent, authorization or order of, or make any filing or registration
with, any court or governmental agency in order for it to execute, deliver or perform any of its obligations under or contemplated
by this Agreement in accordance with the terms hereof or thereof except as such consent, authorization or order has been obtained
prior to the date hereof. The Company and its subsidiaries are unaware of any fact or circumstance which might give rise to any
of the foregoing.

(d)              
SEC Documents; Financial Statements. The Common Stock is registered pursuant to Section 12(g) of the Securities Exchange
Act of 1934 (the “Exchange Act”) and the Company has filed all reports, schedules, forms, statements and other
documents required to be filed by it with the SEC under the Exchange Act for the two years preceding the date hereof (or such shorter
period as the Company was required by law or regulation to file such material) (all of the foregoing filed within the two years
preceding the date hereof as amended after the date hereof and all exhibits included therein and financial statements and schedules
thereto and documents incorporated by reference therein, being hereinafter referred to as the “SEC Documents”)
on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Document prior to the expiration
of any such extension. The Company has delivered to the Investor or its representatives, or made available through the SEC’s
website at http://www.sec.gov, true and complete copies of the SEC Documents. As of their respective dates, the SEC Documents complied
in all material respects with the requirements of the Exchange Act and the rules and regulations of the SEC promulgated thereunder
applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue
statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not misleading. As of their respective dates,
the financial statements of the Company included in the SEC Documents complied as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the SEC with respect thereto. Such financial statements have
been prepared in accordance with generally accepted accounting principles, consistently applied, during the periods involved (except
(i) as may be otherwise indicated in such financial statements or the notes thereto, or (ii) in the case of unaudited interim statements,
to the extent they may exclude footnotes or may be condensed or summary statements) and fairly present in all material respects
the financial position of the Company as of the dates thereof and the results of its operations and cash flows for the periods
then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments). No other information provided
by or on behalf of the Company to the Investor which is not included in the SEC Documents contains any untrue statement of a material
fact or omits to state any material fact necessary in order to make the statements therein, in the light of the circumstance under
which they are or were made, not misleading.

    	 	4	 

    	 

    

 

(e)               
No Default. Except as disclosed in the SEC Documents, the Company is not in default in the performance or observance
of any material obligation, agreement, covenant or condition contained in any indenture, mortgage, deed of trust or other material
instrument or agreement to which it is a party or by which it or its property is bound and neither the execution, nor the delivery
by the Company, nor the performance by the Company of its obligations under this Agreement or any of the exhibits or attachments
hereto will conflict with or result in the breach or violation of any of the terms or provisions of, or constitute a default or
result in the creation or imposition of any lien or charge on any assets or properties of the Company under its Certificate of
Incorporation, By-Laws, any material indenture, mortgage, deed of trust or other material agreement applicable to the Company or
instrument to which the Company is a party or by which it is bound, or any statute, or any decree, judgment, order, rule or regulation
of any court or governmental agency or body having jurisdiction over the Company or its properties, in each case which default,
lien or charge is likely to cause a Material Adverse Effect.

(f)               
Internal Accounting Controls. The Company and each of its subsidiaries maintain a system of internal accounting controls
sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or
specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity
with generally accepted accounting principles and to maintain asset accountability, (iii) access to assets is permitted only in
accordance with management’s general or specific authorization and (iv) the recorded accountability for assets is compared
with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences.

(g)              
Absence of Litigation. Except as set forth in the SEC Documents, there is no action, suit, proceeding, inquiry or
investigation before or by any court, public board, government agency, self-regulatory organization or body pending against or
affecting the Company, the Common Stock or any of the Company’s subsidiaries, wherein an unfavorable decision, ruling or
finding would have a Material Adverse Effect.

    	 	5	 

    	 

    

 

(h)              
Subsidiaries. Except as disclosed in the SEC Documents, the Company does not presently own or control, directly or
indirectly, any interest in any other corporation, partnership, association or other business entity.

(i)                
Tax Status. Except as disclosed in the SEC Documents, the Company and each of its subsidiaries has made or filed
all federal and state income and all other tax returns, reports and declarations required by any jurisdiction to which it is subject
and (unless and only to the extent that the Company and each of its subsidiaries has set aside on its books provisions reasonably
adequate for the payment of all unpaid and unreported taxes) has paid all taxes and other governmental assessments and charges
that are material in amount, shown or determined to be due on such returns, reports and declarations, except those being contested
in good faith and has set aside on its books provision reasonably adequate for the payment of all taxes for periods subsequent
to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to
be due by the taxing authority of any jurisdiction, and the officers of the Company know of no basis for any such claim.

(j)                
Certain Transactions. Except as set forth in the SEC Documents none of the officers, directors, or employees of the
Company is presently a party to any transaction with the Company (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental
of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee or,
to the knowledge of the Company, any corporation, partnership, trust or other entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director, trustee or partner.

(k)              
Foreign Corrupt Practices. Neither the Company nor any subsidiary, nor to the knowledge of the Company or any subsidiary,
any agent or other person acting on behalf of the Company or any subsidiary, has: (i) directly or indirectly, used any funds for
unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii)
made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties
or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company or any subsidiary (or made
by any person acting on its behalf of which the Company is aware) which is in violation of law or (iv) violated in any material
respect any provision of the Foreign Corrupt Practices Act of 1977, as amended. Neither the Company nor any subsidiary nor, to
the Company's knowledge, any director, officer, agent, employee or affiliate of the Company or any subsidiary is currently subject
to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department.

(l)                
Except with respect to the material terms and conditions of the transactions contemplated by this Agreement, all of which
shall be publicly disclosed by the Company as soon as possible after the date hereof, the Company covenants and agrees that neither
it, nor any other person acting on its behalf, will provide the Investor or its agents or counsel with any information that the
Company believes constitutes material non-public information, unless prior thereto the Investor shall have entered into a written
agreement with the Company regarding the confidentiality and use of such information. The Company understands and confirms that
the Investor shall be relying on the foregoing covenant in effecting transactions in securities of the Company.

    	 	6	 

    	 

    

 

4.     
INDEMNIFICATION. The Company will indemnify and hold the Investor and its directors, officers, shareholders, members,
partners, employees and agents (and any other persons with a functionally equivalent role of a person holding such titles notwithstanding
a lack of such title or any other title), each person who controls the Investor, and the directors, officers, shareholders, agents,
members, partners or employees (and any other persons with a functionally equivalent role of a person holding such titles notwithstanding
a lack of such title or any other title) of such controlling persons (each, a “Purchaser Party”) harmless from
any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all judgments, amounts
paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation that any such Purchaser Party
may suffer or incur as a result of or relating to (a) any breach of any of the representations, warranties, covenants or agreements
made by the Company in this Agreement or the Note or (b) any action instituted against the Purchaser Parties in any capacity, or
any of them or their respective affiliates, by any stockholder of the Company who is not an affiliate of such Purchaser Party,
with respect to any of the transactions contemplated by herein (unless such action is based upon a breach of such Purchaser Party’s
representations, warranties or covenants under this Agreement or any agreements or understandings such Purchaser Party may have
with any such stockholder or any violations by such Purchaser Party of state or federal securities laws or any conduct by such
Purchaser Party which constitutes fraud, gross negligence, willful misconduct or malfeasance). If any action shall be brought against
any Purchaser Party in respect of which indemnity may be sought pursuant to this Agreement, such Purchaser Party shall promptly
notify the Company in writing, and the Company shall have the right to assume the defense thereof with counsel of its own choosing
reasonably acceptable to the Purchaser Party. Any Purchaser Party shall have the right to employ separate counsel in any such action
and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Purchaser Party
except to the extent that (i) the employment thereof has been specifically authorized by the Company in writing, (ii) the Company
has failed after a reasonable period of time to assume such defense and to employ counsel or (iii) in such action there is, in
the reasonable opinion of counsel, a material conflict on any material issue between the position of the Company and the position
of such Purchaser Party, in which case the Company shall be responsible for the reasonable fees and expenses of no more than one
such separate counsel. The Company will not be liable to any Purchaser Party under this Agreement (y) for any settlement by a Purchaser
Party effected without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (z) to
the extent, but only to the extent that a loss, claim, damage or liability is attributable to any Purchaser Party’s breach
of any of the representations, warranties, covenants or agreements made by such Purchaser Party in this Agreement or the Note.
The indemnification required by this Section 4 shall be made by periodic payments of the amount thereof during the course of the
investigation or defense, as and when bills are received or are incurred. The indemnity agreements contained herein shall be in
addition to any cause of action or similar right of any Purchaser Party against the Company or others and any liabilities the Company
may be subject to pursuant to law.

5.     
GOVERNING LAW. This Agreement shall be governed by and interpreted in accordance with the laws of the State of New
York without regard to the principles of conflict of laws. Each of the parties consents to the jurisdiction of the state courts
of the State of New York and the U.S. District Court for the District of New York sitting in Manhattan, for the adjudication
of any civil action asserted pursuant to this paragraph.

 

    	 	7	 

    	 

    

6.     
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 electronic mail (provided that the electronic mail transmission is returned in error or the sender is not
otherwise notified of any error in transmission); or (iii) one (1) Business 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 Company, to:	Omagine, Inc.
	 	
        136 Madison Avenue

        Suite 550

        New York, NY 10016

	 	 
	 	Attention:  Chief Executive Officer
	 	Telephone:  (212) 563-4141
	 	
        Email: Charles.Kuczynski@omagine.com

        Email: Frank.Drohan@omagine.com

	 	 
	With a copy to: 	Sichenzia Ross Friedman Ference LLP
	 	61 Broadway
	 	New York, New York 10006
	 	Attention:  Michael Ference
	 	Telephone: (212) 930-9700
	 	Email:    MFerence@srff.com

 

	If to the Holder:	YA II PN, Ltd. (f/k/a YA Global Master SPV, Ltd.)
	 	1012 Springfield Avenue
	 	Mountainside, NJ  07092
	 	Attention:Mark Angelo
	 	
        Telephone:(201) 985-8300

        Email: MAngelo@yorkvilleadvisors.com

	 	 
	With a copy to:	David Gonzalez, Esq. 
	 	1012 Springfield Avenue
	 	Mountainside, NJ  07092
	 	Telephone:(201) 985-8300
	 	Email:  dgonzalez@yorkvilleadvisors.com 
	 	 

or at such other address and/or
electronic mail address and/or to the attention of such other person as the recipient party has specified by written notice given
to each other party three 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, or (ii) provided by a nationally recognized overnight delivery
service, shall be rebuttable evidence of personal service, or receipt from a nationally recognized overnight delivery service in
accordance with clause (i) or (ii) above, respectively.

    	 	8	 

    	 

    

 

7.     
MISCELLANEOUS.

(a)               
Counterparts. This Agreement may be executed in two or more identical counterparts, all of which shall be considered
one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other
party.

(b)              
Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and
permitted assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior written consent
of the Investor (other than by merger). The Investor may assign any or all of its rights under this Agreement to any person to
whom such Investor assigns or transfers the Note, or a portion thereof, provided that such transferee agrees in writing to be bound,
with respect to the Note, by the provisions of the this Agreement that apply to the Investor.

(c)               
Entire Agreement; Amendments. This Agreement supersedes all other prior oral or written agreements between the Investor
and the Company with respect to the matters discussed herein, and this Agreement, and the instruments referenced herein, contain
the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically set
forth herein or therein, neither the Company nor the Investor makes any representation, warranty, covenant or undertaking with
respect to such matters. No provision of this Agreement may be waived or amended other than by an instrument in writing signed
by the party to be charged with enforcement.

 

[signature page
follows]

    	 	9	 

    	 

    

IN
WITNESS WHEREOF, each of the Investor and the Company have caused their respective signature page to this Note Purchase
Agreement to be duly executed as of the date first written above.

	 	COMPANY:
	 	 
	 	OMAGINE, INC. 
	 	 
	 	By: 	/s/
    Charles P. Kuczynski
	 	 	Charles
    P. Kuczynski
Vice-President & Secretary

 

	 	INVESTOR:
	 	 
	 	YA II PN, LTD. 
	 	 
	 	By:Yorkville Advisors Global
    LP
	 	Its:Investment Manager
	 	 
	 	By:Yorkville Advisors Global
    LLC
	 	Its:General Partner
	 	 
	 	By: 	/s/
    Gerald Eicke
	 	 	Name:
    Gerald Eicke
Title: Managing Member

 

    	 	10	 

    	 

    

 

Exhibit
A

Form of Note

 

 

    	 	11Exhibit 10.2

 

THIS NOTE HAS NOT BEEN REGISTERED
WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE. THIS NOTE HAS BEEN SOLD 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.

OMAGINE,
INC.

 

Promissory Note

	No. Omagine-PN4	Original Principal Amount:$600,000

 

FOR VALUE RECEIVED,
Omagine, Inc., a corporation organized and existing under the laws of the State of Delaware (the “Company”),
hereby promises to pay to the order of YA II PN, Ltd. (p/k/a YA Global Master SPV, Ltd.) or its registered assigns (the
“Holder”) (i) the outstanding portion of the amount set out above as the Original Principal Amount (as reduced
pursuant to the terms hereof pursuant to scheduled payment, redemption or otherwise, the “Principal”) when due,
whether a regularly scheduled principal payment or upon the Maturity Date (as defined below), acceleration, redemption or otherwise
(in each case in accordance with the terms hereof) and (ii) to pay interest (“Interest”) on any outstanding
Principal at the applicable Interest Rate (as defined below) from the date defined in Section 17 hereof as the Issuance Date (the
“Issuance Date”) until the same is paid, whether a regularly scheduled interest payment or upon the Maturity
Date or acceleration, redemption or otherwise (in each case in accordance with the terms hereof) pursuant to the terms of this
Promissory Note (the “Note”).

This Note is being
issued pursuant to that certain Note Purchase Agreement dated as of March 15, 2016 (the “Note Purchase Agreement“)
between the Company and the Holder.

Certain capitalized terms
used herein but otherwise not defined herein are defined in Section 17 or in the Note Purchase Agreement.

(1)              
GENERAL TERMS

(a)               
Advance of Original Principal Amount. In consideration for the issuance of this Note on the Issuance Date by the
Company, the Holder shall advance and make available to the Company on the Issuance Date the Original Principal Amount by wire
transfer of immediately available funds to the account indicated by the Company on Schedule I attached hereto in
accordance with the Note Purchase Agreement.

    	 	1	 

    	 

    

 

(b)              
Maturity Date. All amounts owed under this Note shall be due and payable on March 15, 2017 (the “Maturity
Date”). On the Maturity Date, the Company shall pay to the Holder an amount in cash representing all then outstanding
Principal and accrued and unpaid Interest.

(c)               
Payments. Payments to be made under this Note must be paid by wire transfer of immediately available funds to the
account listed on Schedule II hereto (or to any other account specified by the Holder to the Company by notice given
in accordance with Section 7 hereof). On each of the Installment Dates, the Company shall pay to the Holder an amount equal to
the relevant Installment Amount due on such Installment Date as listed on Schedule III hereto.

(d)              
Interest. Interest shall accrue on the outstanding Principal balance hereof at a rate equal to 10% per annum (“Interest
Rate”). Interest shall be calculated on the basis of a 365-day year and the actual number of days elapsed, to the extent
permitted by applicable law.

(2)              
NO PREPAYMENT PENALTY. The Company may prepay all or any part of the balance outstanding hereunder at any time without
penalty.

(3)              
REPRESENTATIONS AND WARRANTIES. The Company hereby represents and warrants to the Investor that the following are
true and correct as of the date hereof:

(a)   
(i) The Company has the requisite corporate power and authority to enter into and perform its obligations under this Note
and any related agreements, in accordance with the terms hereof and thereof, (ii) the execution and delivery of this Note and any
related agreements by the Company and the consummation by it of the transactions contemplated hereby and thereby, have been duly
authorized by the Company’s Board of Directors and no further consent or authorization is required by the Company, its Board
of Directors or its stockholders, (iii) this Note and any related agreements have been duly executed and delivered by the
Company, (iv) this Note and any related agreements, constitute the valid and binding obligations of the Company enforceable against
the Company in accordance with their terms, except as such enforceability may be limited by general principles of equity or applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally, the enforcement
of creditors’ rights and remedies.

(b)  
The execution, delivery and performance by the Company of its obligations under this Note will not (i) result in a violation
of the Company’s Articles of Incorporation or By-laws or any certificate of designation of any outstanding series of preferred
stock of the Company or (ii) conflict with or constitute a default (or an event which with notice or lapse of time or both would
become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement,
indenture or instrument to which the Company or any of its subsidiaries is a party, or result in a violation of any law, rule,
regulation, order, judgment or decree (including federal and state securities laws and regulations and the rules and regulations
of the Principal Market on which the Common Stock is quoted) applicable to the Company or any of its subsidiaries or by which any
material property or asset of the Company is bound or affected and which would cause a Material Adverse Effect.

    	 	2	 

    	 

    

 

(4)              
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) shall have occurred and be continuing:

(i)                
the Company’s failure to pay to the Holder any amount of Principal, Interest or other amounts when and as due and
payable under this Note;

(ii)              
the Company or any subsidiary of the Company shall commence, or there shall be commenced against the Company or any subsidiary
of the Company under any applicable bankruptcy or insolvency laws as now or hereafter in effect or any successor thereto, or the
Company or any subsidiary of the Company commences, or there shall be commenced against the Company or any subsidiary of the Company,
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 Company or any subsidiary of the Company,
in each case which remains un-dismissed for a period of 61 days; or the Company or any subsidiary of the Company is adjudicated
insolvent or bankrupt pursuant to a final, non-appealable order; or any order of relief or other order approving any such case
or proceeding is entered; or the Company or any subsidiary of the Company 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 un-discharged or un-stayed
for a period of 61 days; or the Company or any subsidiary of the Company makes a general assignment for the benefit of creditors;
or the Company or any subsidiary of the Company shall admit in writing that it is unable to pay its debts generally as they become
due; or the Company or any subsidiary of the Company shall call a meeting of its creditors with a view to arranging a composition,
adjustment or restructuring of its debts; or any corporate or other action is taken by the Company or any subsidiary of the Company
for the purpose of effecting any of the foregoing;

(iii)            
the Common Stock ceases to be quoted or listed for trading on the Principal Market and shall not again be quoted or listed
for trading on any Principal Market within five Trading Days of such delisting;

(iv)            
the Common Stock shall be suspended from trading on the Principal Market for a period of ten consecutive Trading Days;

(v)              
the Company is a party to any agreement memorializing (1) the consummation of any transaction or event (whether by means
of a share exchange or tender offer applicable to the Common Stock, a liquidation, consolidation, recapitalization, reclassification,
combination or merger of the Company or a sale, lease or other transfer of all or substantially all of the consolidated assets
of the Company) or a series of related transactions or events pursuant to which all of the outstanding shares of Common Stock are
exchanged for, converted into or constitute solely the right to receive, cash, securities or other property, (2) a consolidation
or merger in which the Company is not the surviving corporation, or (3) a sale, assignment, transfer, conveyance or other disposal
of all or substantially all of the properties or assets of the Company to another person or entity (each of (1), (2) and (3) a
“Change in Control”) unless in connection with such Change in Control, all Principal and accrued and unpaid
Interest due under this Note will be paid in full or the Holder consents to such Change in Control;

(vi)            
the Company shall fail to observe or perform any other material covenant, agreement or warranty contained in, or otherwise
commit any material breach or default of any provision of this Note, the Standby Equity Distribution Agreement between the Company
and the Holder dated April 22, 2014, as amended (the “SEDA”), which is not cured within the time prescribed
in this Note, or the SEDA, as applicable, or if not so prescribed, within ten days after notice to the Company by the Holder of
such material failure, breach or default;

    	 	3	 

    	 

    

 

(vii)          
an event of default by the Company under any other material obligation, instrument, note or agreement for borrowed money
occurring after the Issuance Date of this Note and continuing beyond any applicable notice and/or grace period, and as a result
of which the obligations of the Company under such material obligation, instrument, note or agreement have been accelerated.

(5)              
REMEDY UPON DEFAULT. During the time that any portion of this Note is outstanding, if (i) any Event of Default has
occurred, the Holder, by notice in writing to the Company, may at any time and from time to time declare the full unpaid Principal
of this Note or any portion thereof, together with Interest accrued thereon to be due and payable immediately (the “Accelerated
Amount”) or (ii) any Event of Default specified in Section 4(a)(ii) has occurred, the unpaid Principal of the Note and
the Interest accrued thereon shall be immediately and automatically due and payable without necessity of further action. In addition,
for so long as an Event of Default has occurred and remains uncured, the Company shall pay default interest at the rate of 15%
per annum until the applicable Event of Default is cured. 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.

(6)              
REISSUANCE OF THIS NOTE. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss,
theft, destruction or mutilation of this Note, and, in the case of loss, theft or destruction, of an indemnification undertaking
by the Holder to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this Note, the
Company shall execute and deliver to the Holder a new Note representing the outstanding Principal which Note (i) shall be of like
tenor with this Note, (ii) shall represent, as indicated on the face of such new Note, the Principal remaining outstanding (iii)
shall have an issuance date, as indicated on the face of such new Note, which is the same as the Issuance Date of this Note, (iv)
shall have the same rights and conditions as this Note, and (v) shall represent accrued and unpaid Interest from the Issuance Date.

(7)              
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 electronic mail (provided that the electronic mail transmission is not returned in error or the sender is not otherwise
notified of any error in transmission); or (iii) one (1) Business 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:

    	 	4	 

    	 

    

 

	If to the Company, to:	Omagine, Inc.
	 	
        136 Madison Avenue

        Suite 550

        New York, NY 10016

	 	 
	 	Attention:  Chief Executive Officer
	 	Telephone:  (212) 563-4141
	 	
        Email: Charles.Kuczynski@omagine.com

        Email: Frank.Drohan@omagine.com

	 	 
	With a copy to:	Sichenzia Ross Friedman Ference LLP
	 	61 Broadway
	 	New York, New York 10006
	 	Attention:  Michael Ference
	 	Telephone: (212) 930-9700
	 	Email:    MFerence@srff.com

 

	If to the Holder:	YA II PN, Ltd.
	 	1012 Springfield Avenue
	 	Mountainside, NJ  07092
	 	Attention:Mark Angelo
	 	
        Telephone:(201) 985-8300

        Email: MAngelo@yorkvilleadvisors.com

	 	 
	With a copy to:	David Gonzalez, Esq.
	 	1012 Springfield Avenue
	 	Mountainside, NJ  07092
	 	Telephone:(201) 985-8300
	 	Email:  dgonzalez@yorkvilleadvisors.com 
	 	 

 

or at such other address
and/or electronic mail address and/or to the attention of such other person as the recipient party has specified by written notice
given to each other party three 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, or (ii) provided by a nationally recognized overnight
delivery service, shall be rebuttable evidence of personal service, or receipt from a nationally recognized overnight delivery
service in accordance with clause (i) or (ii) above, respectively.

(8)              
No provision of this Note shall alter or impair the obligations of the Company, which are absolute and unconditional, to
pay the Principal of or Interest (if any) on, this Note at the time, place, and rate, and in the currency, herein prescribed. This
Note is a direct obligation of the Company. As long as this Note is outstanding, the Company shall not and shall cause its 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 under this Note; or (ii) enter into any agreement with respect to any of the foregoing.

(9)              
This Note shall not entitle the Holder to any of the rights of a stockholder of the Company, 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 Company.

    	 	5	 

    	 

    

 

(10)          
This Note shall be governed by and interpreted in accordance with the laws of the State of New York, without regard to the
principles of conflict of laws. Each of the parties consents to the jurisdiction of the state courts of the State of New York and
the U.S. District Court for the District of New York sitting in Manhattan, in connection with any dispute arising under this
Note 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.

(11)          
If an Event of Default has occurred, then the Company shall reimburse the Holder promptly for all out-of-pocket fees, costs
and expenses, including, without limitation, reasonable attorneys’ fees and expenses incurred by the Holder in any action
in connection with this Note, 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 in accordance with the terms of this Note, (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.

(12)          
Any waiver by 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 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 must be in writing.

(13)          
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 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 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 Note, 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 as though no such law had been enacted.

(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.

(15)          
Assignment of this Note by the Company shall be prohibited without the prior written consent of the Holder. The Holder
shall be entitled to assign, sell, transfer, negotiate or otherwise make any disposition of this Note in whole or in part to any
person or entity without the prior written consent of the Company.

    	 	6	 

    	 

    

(16)          
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 NOTE 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 THE NOTE PURCHASE AGREEMENT AND THIS NOTE.

(17)          
CERTAIN DEFINITIONS For purposes of this Note, the following terms shall have the following meanings:

(a)               
 “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 in the United States are authorized or required by law or other government
action to close.

(b)              
“Installment Amount” means the principal and interest payment due on an Installment Date as set forth
on Schedule III hereto.

(c)               
“Installment Date” means each date on which Installment Amounts are due to be paid in accordance with
Schedule III hereto.

(d)              
“Issuance Date” means the Closing Date (as that term is defined in the Note Purchase Agreement).

  

[Signature Page Follows]

 

    	 	7	 

    	 

    

 

 

IN WITNESS WHEREOF,
the Company has caused this Note to be duly executed by a duly authorized officer as of March 15, 2016.

		COMPANY:
	 	 
	 	OMAGINE, INC. 
	 	 
	 	By: 	/s/ Charles P. Kuczynski
	 	 	Charles P. Kuczynski
Vice-President & Secretary 

 

 

    	 	8	 

    	 

    

 

 

Schedule I

(Company Account Information)

 

 

 

 

Omagine, Inc.

Account Number  ████████
(Confidential)

 

Bank of America

ABA # 021000322

Swift ID: BOFAUS3N

 

34th Street Branch

324 West 34th Street

New York, N.Y. 10118

 

Bank Contact: Sydney Haines

Telephone: 212-613-1240

 

    	 	9	 

    	 

    

 

Schedule II

(Holder Account Information)

 

	YA II PN, Ltd.	 	 
	-Wiring Instructions-	 	 
	 	 	 
	*Account Currency: USD	 	 
	Beneficiary Bank:	 	The Private Bank and Trust Company
	 	 	120 South LaSalle – Chicago, IL 60603
	 	 	 
	ABA/Routing Number:	 	071006486 (for Domestic wires)
	 	 	 
	BIC/SWIFT Code:		PVTBUS44 (for International wires)
	 	 	 
	Beneficiary Account Number:	 	 ████████ (Confidential)
	 	 	 
	Beneficiary Account Name:	 	YA II PN, Ltd.
	 	 	1012 Springfield Ave.
	 	 	Mountainside NJ 07092
	 	 	 
	 	 	 

 

    	 	10	 

    	 

    

 

Schedule III

Repayment Schedule

 

 

 

 

    	 	11

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00255-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00255-of-00352.parquet"}]]