Document:

Exhibit
10(a)

 

INDEMNIFICATION AGREEEMENT

 

THIS INDEMNIFICATION AGREEMENT, dated as of             ,
20   is made by and between TENET HEALTHCARE CORPORATION, a Nevada
corporation (the “Company”), and                
(“Indemnitee”).

 

WHEREAS, it is essential to the Company to retain
and attract as directors and officers the most capable persons available;

 

WHEREAS, Article X of the Company’s Amended and
Restated Bylaws authorizes the Company to enter into agreements with directors
and officers providing for indemnification to the fullest extent permitted by
Nevada law;

 

WHEREAS, Section 78.752 of the Nevada Revised
Statutes authorizes the Company to purchase and maintain insurance or make
other financial arrangements on behalf of any person who is or was a director,
officer, employee or agent of the Company, or is or was serving at the request
of the Corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise for any
liability or expenses incurred by such person in such capacity;

 

WHEREAS, Indemnitee is a director or officer of the
Company;

 

WHEREAS, both the Company and Indemnitee recognize
the increased risk of litigation and other claims being asserted against
directors and officers of corporations; and

 

WHEREAS, in recognition of Indemnitee’s need for
substantial protection against personal liability and in order to induce
Indemnitee to serve or continue to serve the Company, the Company wishes to
provide Indemnitee with the benefits contemplated by this Agreement including,
without limitation, the indemnification of and the payment of expenses in
advance of the final disposition of a potentially indemnifiable claim to
Indemnitee to the fullest extent permitted by law and as set forth in this
Agreement, and, to the extent insurance is maintained, for the coverage of
Indemnitee under the Company’s directors’ and officers’ liability insurance
policies.

 

NOW, THEREFORE, in consideration of the above
premises and intending to be legally bound hereby, the parties agree as
follows:

 

1.     Certain Definitions

 

(a)   Board:
the Board of Directors of the Company.

 

(b)   Change
in Control: shall be deemed to have occurred if (i) any “person” (as
such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)), other than a trustee or
other fiduciary holding securities under an employee benefit plan of the
Company or a corporation owned directly or indirectly by the shareholders of
the Company in substantially the same proportions as their ownership of stock
of the Company, becomes the “Beneficial Owner” (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company
representing 20% or more of the total voting power represented by the Company’s
then outstanding Voting Securities, or (ii) during any period of two
consecutive years, individuals who at the beginning of such period constitute
the Board and any new director whose election by the Board or nomination for election
by the Company’s shareholders was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a

 

 

majority thereof, or (iii) the
shareholders of the Company approve a merger or consolidation of the Company
with any other corporation, other than a merger or consolidation that would
result in the Voting Securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into Voting Securities of the surviving entity) at least 80% of the
total voting power represented by the Voting Securities of the Company or such
surviving entity outstanding immediately after such merger or consolidation, or
the shareholders of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the Company (in one
transaction or a series of transactions) of all or substantially all of the
Company’s assets.

 

(c)   Disinterested
Director: a director of the Company who is not and was not a party to the
Proceeding in respect of which indemnification is sought by Indemnitee.

 

(d)   Expenses:
any expense, including without limitation, attorneys’ fees, retainers, court
costs, transcript costs, fees and expenses of experts, including accountants
and other advisors, travel expenses, duplicating costs, postage, delivery
service fees, filing fees, and all other disbursements or expenses of the types
typically paid or incurred in connection with investigating, defending, being a
witness in, or participating in, or preparing for any of the foregoing in, any
Proceeding relating to an Indemnifiable Event, and any expenses of establishing
a right to indemnification under this Agreement.

 

(e)   Indemnifiable
Event: any event or occurrence that takes place either prior to or after the execution of this Agreement, related to the
fact that Indemnitee is or was a director or officer of
the Company, or while a director or officer, is or was serving at the request
of the Company as a director, officer, employee, trustee, agent, limited
partner, member or fiduciary of another foreign or domestic corporation,
partnership, joint venture, employee benefit plan, trust, or other enterprise,
or was a director, officer, employee, or agent of a foreign or domestic
corporation that was a predecessor corporation of the Company or of another
enterprise at the request of such predecessor corporation, or related to
anything done or not done by Indemnitee in any such capacity, whether or not
the basis of the Proceeding is an alleged action or inaction in an official
capacity as a director, officer, employee, or agent or in any other capacity
while serving as a director, officer, employee, or agent of the Company, as
described above.

 

(f)    Independent
Counsel: the person or body appointed in connection with Section 3.

 

(g)   NRS:
the Nevada Revised Statutes, as amended from time to time.

 

(h)   Potential
Change in Control: shall be deemed to have occurred if (i) the Company
enters into an agreement or arrangement, the consummation of which would result
in the occurrence of a Change in Control; (ii) any person (including the
Company) publicly announces an intention to take or to consider taking actions
that, if consummated, would constitute a Change in Control; (iii) any
person (other than a trustee or other fiduciary holding securities under an
employee benefit plan of the Company acting in such capacity or a corporation
owned, directly or indirectly, by the shareholders of the Company in
substantially the same proportions as their ownership of stock of the Company),
who is or becomes the Beneficial Owner, directly or indirectly, of securities
of the Company representing 10% or more of the combined voting power of the
Company’s then outstanding Voting Securities, increases their beneficial
ownership of such securities by 5% or more over the percentage so owned by such
person on the date hereof, or (iv) the Board adopts a resolution to the
effect that, for purposes of this Agreement, a Potential Change in Control has
occurred.

 

(i)    Proceeding:
any threatened, pending, or completed action, suit, arbitration, alternative
dispute mechanism, inquiry, administrative or legislative hearing, or
investigation or any other actual, threatened or completed proceeding,
including any and all appeals, whether conducted by the Company or

 

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any other party, whether civil, criminal,
administrative, investigative, or other, and in each case whether or not
commenced prior to the date of this Agreement, that relates to an Indemnifiable
Event.

 

(j)    Voting
Securities: any securities of the Company that vote generally in the
election of directors.

 

2.     Agreement to Indemnify.

 

(a)   General
Agreement. In the event Indemnitee was, is, or becomes a party to or
witness or other participant in, or is threatened to be made a party to or
witness or other participant in a Proceeding by reason of (or arising in part
out of) an Indemnifiable Event, the Company shall indemnify Indemnitee to the
fullest extent permitted by law as soon as practicable but in no event no later
than thirty (30) days after written demand to the Company in accordance with Section 4,
from and against any and all Expenses, liability or loss, judgments, fines,
ERISA excise taxes and penalties, amounts paid or to be paid in settlement, any
interest, assessments, or other charges imposed thereon, and any federal,
state, local, or foreign taxes imposed as a result of the actual or deemed
receipt of any payments under this Agreement, to the fullest extent permitted
by applicable law, as the same exists or may hereafter be amended or interpreted
(but in the case of any such amendment or interpretation, only to the extent
that such amendment or interpretation permits the Company to provide broader
indemnification rights than were permitted prior thereto).

 

(b)   Initiation
of Proceeding by Indemnitee. Notwithstanding anything in this Agreement to
the contrary, Indemnitee shall not be entitled to indemnification or payment of
expenses pursuant to this Agreement in connection with any Proceeding initiated
by Indemnitee (including, without limitation, counterclaims) against the
Company or any director or officer of the Company unless (i) the Company
has joined in or the Board has consented to the initiation of such Proceeding; (ii) the
Proceeding is one to enforce indemnification rights under Section 5; or (iii) the
Proceeding is instituted after a Change in Control.

 

(c)   Payment
of Expenses in Advance of Final Disposition. If so requested by Indemnitee,
the Company shall pay any and all Expenses to Indemnitee (an “Expense Payment”)
within five (5) business days after the receipt by the Company of a
statement or statements from Indemnitee requesting such payment or payments.
Expense Payments shall be made without regard to Indemnitee’s ability to repay
the Expenses and without regard to Indemnitee’s ultimate entitlement to
indemnification under the provisions of this Agreement. Indemnitee shall
qualify for the payment of expenses solely upon the execution and delivery to
the Company of an undertaking in form and substance reasonably satisfactory to
the Company providing that Indemnitee undertakes to repay the amount if it is
ultimately determined by a court of competent jurisdiction that Indemnitee is
not entitled to be indemnified by the Company. Payments shall include any and
all reasonable Expenses incurred pursuing an action to enforce this right of
payment. Any determination made by the Independent Counsel that Indemnitee
would not be permitted to be indemnified
under applicable law shall not be binding and Indemnitee shall not be required
to reimburse the Company for any Expense Payment until a final judicial
determination is made with respect thereto (as to which all rights of appeal
therefrom have been exhausted or lapsed). Indemnitee’s obligation to reimburse
the Company for Expense Payments shall be unsecured and no interest shall be
charged thereon.

 

(d)   Mandatory
Indemnification. Notwithstanding any other provision of this Agreement, to
the extent that Indemnitee has been successful (on the merits or otherwise) in
defense of any Proceeding relating in whole or in part to an Indemnifiable
Event or in defense of any claim, issue or matter therein, Indemnitee shall be
indemnified against all Expenses incurred in connection therewith. For purposes
of this Section 2(d) and without limiting the foregoing, the
termination of any claim, issue or matter in any

 

3

 

such Proceeding by dismissal, with or without
prejudice, shall be deemed to be a successful result as to such claim, issue or
matter.

 

(e)   Partial
Indemnification. If Indemnitee is entitled under any provision of this
Agreement to indemnification by the Company for some or a portion of any
Expenses, liability or loss, judgments, fines, ERISA excise taxes and
penalties, amounts paid or to be paid in settlement, any interest, assessments,
or other charges imposed thereon, or any federal, state, local, or foreign
taxes imposed as a result of the actual or deemed receipt of any payments under
this Agreement, but not, however, for the total amount thereof, the Company
shall nevertheless indemnify Indemnitee for the portion thereof to which
Indemnitee is entitled.

 

3.     Authorization of Indemnification; Independent Counsel.
The person, persons or entity (the “Independent Counsel”) who shall determine
whether indemnification is permissible under applicable law shall be an
attorney admitted to practice in the State of Nevada, selected by Indemnitee
and approved and appointed by a majority vote of a quorum consisting of
Disinterested Directors. If no Disinterested Directors exist, then the Board
shall select a person, persons or entity otherwise capable of acting as
Independent Counsel to appoint the Independent Counsel. The Independent Counsel
shall not include any person who, under the applicable standards of professional
conduct then prevailing, would have a conflict of interest in representing
either the Company or Indemnitee against the other in an action to determine
Indemnitee’s rights under this Agreement or the Company’s Bylaws now or
hereafter in effect relating to Proceedings for Indemnifiable Events. Such
counsel, among other things, shall render a written opinion to the Company and
Indemnitee as to whether and to what extent Indemnitee is permitted to be
indemnified under applicable law. The Company agrees to pay the reasonable fees
of the Independent Counsel and any party selected to appoint Independent
Counsel and to indemnify fully such counsel against any and all expenses
(including attorneys’ fees), claims, liabilities, loss, and damages arising out of or relating to this Agreement or their
engagement hereunder.

 

4.     Indemnification Process and Appeal.

 

(a)   Indemnification
Payment. Indemnitee shall be entitled to indemnification and shall receive
payment thereof from the Company in accordance with this Agreement as soon as
practicable but in any event no later than thirty (30) calendar days after
Indemnitee has made written demand on the Company for indemnification (which
written demand shall include such documentation and information as is
reasonably available to Indemnitee and is reasonably necessary to determine
whether and to what extent Indemnitee is entitled to indemnification), unless
the Independent Counsel has provided a written determination to the Company and
Indemnitee that indemnification is not permissible under applicable law.

 

(b)   Suit
to Enforce Rights. If (i) no determination as to whether
indemnification is permissible under applicable law has been made within thirty
(30) calendar days after Indemnitee has made a demand in accordance with Section 4(a),
(ii) payment of indemnification pursuant to Section 4(a) is not
made within thirty (30) calendar days after a determination that
indemnification is permissible under applicable law, (iii) Independent
Counsel determines pursuant to Section 4(a) that indemnification is
not permissible under applicable law or (iv) Indemnitee has not received
payment of Expenses within five (5) business days after making such a
request in accordance with Section 2(c), then Indemnitee shall have the
right to enforce its rights under this Agreement by commencing litigation in
any court of competent jurisdiction seeking an initial determination by the
court or challenging any determination by the Independent Counsel or any aspect
thereof. The Company hereby consents to service of process at the address
listed in Section 17 and to appear in any such proceeding. Any
determination by the Independent Counsel not challenged by Indemnitee on or
before the first anniversary of the date of the Independent Counsel’s
determination shall be binding on the Company and Indemnitee. The remedy
provided for in

 

4

 

this Section 4 is non-exclusive and
shall be in addition to any other remedies available to Indemnitee in law or
equity.

 

(c)           Defense to Indemnification; Burden of Proof;
Presumptions.

 

(i)            To the maximum extent permitted by applicable law in
making a determination with respect to whether indemnification is permissible,
the Independent Counsel shall presume that indemnification is permissible if
Indemnitee has submitted a request for indemnification in accordance with Section 4(a) of
this Agreement, and the Company shall have the burden of proof to overcome that
presumption in connection with the making by the Independent Counsel of any
determination contrary to that presumption.

 

(ii)           It shall be a defense to any action brought by Indemnitee
against the Company to enforce this Agreement (other than an action brought to
enforce a claim for Expense Payment incurred in connection with a Proceeding in
advance of its final disposition where the required undertaking has been
tendered to the Company) that it is not permissible under applicable law for
the Company to indemnify Indemnitee for the amount claimed.

 

(iii)          In connection with any action brought pursuant to Section 4(b) as
to whether Indemnitee is entitled to be indemnified hereunder, the Company must
prove with clear and convincing evidence that Indemnitee is not entitled to
indemnification under this Agreement.

 

(iv)          Neither the failure of the Independent Counsel to have made
a determination prior to the commencement of such action by Indemnitee that
indemnification is permissible under applicable law, nor an actual
determination by the Independent Counsel that indemnification is not
permissible under applicable law shall be admissible as evidence in any such
action for any purpose. For purposes of this Agreement, the termination of any
claim, action, suit or proceeding, by judgment, order, settlement (whether with
or without court approval) or conviction, or upon a plea of nolo contendere, or
its equivalent, shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that a court
has determined that indemnification is not permitted by applicable law.

 

(v)           For the purposes of any determination by the Independent
Counsel under this Agreement, Indemnitee shall be deemed to have acted in good
faith and in a manner Indemnitee reasonably believed to be in or not opposed to
the best interests of the Company, or, with respect to any criminal action or
proceeding, to have had no reasonable cause to believe Indemnitee’s conduct was
unlawful, if Indemnitee’s action is based on the records or books of account of
the Company or another enterprise, or on information supplied to Indemnitee by
the officers of the Company or another enterprise in the course of their
duties, or on the advice of legal counsel for the Company or another enterprise
or on information or records given or reports made to the Company or another
enterprise by an independent certified public accountant or by an appraiser or
other expert selected with reasonable care by the Company or another
enterprise. The term “another enterprise” as used in this Section 4(c)(v) shall
mean any other corporation or any partnership, joint venture, trust, employee
benefit plan or other enterprise of which Indemnitee is or was serving at the
request of the Company as a director, officer, employee or agent. The
provisions of this Section 4(c)(v) shall not be deemed to be
exclusive or to limit in any way the circumstances in which Indemnitee may be
deemed to have met the applicable standard of conduct set forth under Nevada
law.

 

5

 

5.     Indemnification for Expenses Incurred in Enforcing Rights.
The Company shall indemnify Indemnitee against any and all Expenses and, if
requested by Indemnitee, shall pay such Expenses to Indemnitee in advance of
final disposition on such terms and conditions as the Board deems appropriate,
that are incurred by Indemnitee in connection with any claim asserted against
or action brought by Indemnitee for:

 

(a)   enforcement
of this Agreement;

 

(b)   indemnification
of Expenses or Expense Payments by the Company under this Agreement or any
other agreement or under applicable law or the Company’s Articles of
Incorporation or Bylaws now or hereafter in effect relating to indemnification
for Indemnifiable Events, and/or

 

(c)   recovery
under directors’ or officers’ liability insurance policies maintained by the
Company.

 

6.     Notification and Defense of Proceeding.

 

(a)   Notice.
Promptly after receipt by Indemnitee of notice of the commencement of any
Proceeding relating to an Indemnifiable Event, Indemnitee shall, if a claim in
respect thereof is to be made against the Company under this Agreement, notify
the Company of the commencement thereof; but the omission to so notify the
Company shall not relieve it from any liability that it may have to Indemnitee.

 

(b)   Defense.
With respect to any Proceeding relating to an Indemnifiable Event as to which
Indemnitee notifies the Company of the commencement thereof, the Company shall
be entitled to participate in such Proceeding at its own expense and except as
otherwise provided below, and, to the extent the Company so wishes, it may
assume the defense thereof with counsel reasonably satisfactory to Indemnitee.
After notice from the Company to Indemnitee of its election to assume the
defense of any Proceeding relating to an Indemnifiable Event, the Company shall
not be liable to Indemnitee under this Agreement or otherwise for any Expenses
subsequently incurred by Indemnitee in connection with the defense of such
Proceeding other than reasonable costs of investigation or as otherwise provided
below. Indemnitee shall have the right to employ Indemnitee’s own counsel in
such Proceeding but all Expenses related thereto incurred after notice from the
Company of its election to assume the defense shall be at Indemnitee’s expense
unless: (i) the employment of counsel by Indemnitee has been authorized by
the Company, (ii) Indemnitee has reasonably determined that there maybe a
conflict of interest between Indemnitee and the Company in the defense of the
Proceeding, (iii) Independent Counsel has determined that a Change in
Control has occurred, or (iv) the Company shall not within thirty (30)
calendar days in fact have employed counsel to assume the defense of such
Proceeding, in each of which case all Expenses of the Proceeding shall be borne
by the Company. If the Company has selected counsel to represent Indemnitee and
other current and former directors and officers of the Company in the defense
of a Proceeding, and a majority of such persons, including Indemnitee,
reasonably object to such counsel selected by the Company pursuant to this Section 6(b),
then such persons, including Indemnitee, shall be permitted to employ one (1) additional
counsel of their choice and the reasonable fees and expenses of such counsel
shall be at the expense of the Company; provided, however, that
such counsel shall be chosen from amongst the list of counsel, if any, approved
by any company with which the Company obtains or maintains insurance. In the
event separate counsel is retained by an Indemnitee pursuant to this Section 6(b),
the Company shall cooperate with Indemnitee with respect to the defense of the
Proceeding, including making documents, witnesses and other reasonable
information related to the defense available to Indemnitee and such separate
counsel pursuant to joint-defense agreements or confidentiality agreements, as
appropriate. The Company shall not be entitled to assume the defense of any
Proceeding

 

6

 

brought by or on behalf of the Company or as
to which the determination shall have been made by Indemnitee pursuant to (ii) above
or by Independent Counsel pursuant to (iii) above.

 

(c)   Settlement
of Claims. The Company shall not be liable to indemnify Indemnitee under
this Agreement or otherwise for any amounts paid in settlement of any
Proceeding effected without the Company’s written consent, provided,
however, that if a Change in Control has occurred, the Company shall
be liable for indemnification of Indemnitee for amounts paid in settlement if
the Independent Counsel has approved the settlement. The Company shall not
settle any Proceeding in any manner that would impose any penalty or limitation
on Indemnitee without Indemnitee’s written
consent. Neither the Company nor Indemnitee shall unreasonably withhold their
consent to any proposed settlement. The Company’s liability hereunder shall not
be excused if participation in the Proceeding by the Company was barred by this
Agreement.

 

7.     Establishment of Trust. In the event of a Change in
Control or a Potential Change in Control, the Company shall, upon written
request by Indemnitee, create a trust for the benefit of Indemnitee and from
time to time upon written request of Indemnitee shall fund the trust in an
amount sufficient to satisfy any and all claims hereunder, including Expenses,
reasonably anticipated at the time of each such request to be incurred in
connection with investigating, preparing for, participating in, or defending
any Proceeding relating to an Indemnifiable Event. The amount or amounts to be
deposited in the trust pursuant to the foregoing funding obligation shall be
determined by the Independent Counsel. The terms of the trust shall provide
that upon a Change in Control, (i) the trust shall not be revoked or the
principal thereof invaded, without the written consent of Indemnitee, (ii) the
trustee shall advance, within ten (10) business days of a request by
Indemnitee, any and all Expenses to Indemnitee (and Indemnitee hereby agrees to
reimburse the trust under the same circumstances for which Indemnitee would be
required to reimburse the Company under Section 2(c) of this
Agreement), (iii) the trust shall continue to be funded by the Company in
accordance with the funding obligation set forth above, (iv) the trustee
shall promptly pay to Indemnitee all amounts for which Indemnitee shall be
entitled to indemnification pursuant to this Agreement or otherwise, and (v) all
unexpended funds in the trust shall revert to the Company upon a final
determination by the Independent Counsel or a court of competent jurisdiction,
as the case may be, that Indemnitee has been fully indemnified under the terms
of this Agreement. The trustee shall be chosen by Indemnitee. Nothing in this Section 7
shall relieve the Company of any of its obligations under this Agreement. All
income earned on the assets held in the trust shall be reported as income by
the Company for federal, state, local, and foreign tax purposes. The Company
shall pay all costs of establishing and maintaining the trust and shall
indemnify the trustee against any and all expenses (including attorneys’ fees),
claims, liabilities, loss, and damages arising out of or relating to this
Agreement or the establishment and maintenance of the trust.

 

8.     Non-Exclusivity. The rights of Indemnitee hereunder are
non-exclusive and shall be in addition to any other rights Indemnitee may have
under applicable law, the Company’s Articles of Incorporation, Bylaws or
otherwise. To the extent that a change in applicable law (whether by statute or
judicial decision) permits greater indemnification by agreement than would be
afforded currently under the Company’s Articles of Incorporation, Bylaws,
applicable law, or this Agreement, it is the intent of the parties that
Indemnitee enjoy by this Agreement the greater benefits so afforded by such
change.

 

9.     Liability Insurance. To the extent the Company maintains
an insurance policy or policies providing directors’ or officers’ liability
insurance, Indemnitee shall be covered by such policy or policies, in
accordance with its or their terms, to the maximum extent of the coverage
available for any Company director or officer.

 

10.   Period of Limitations. No legal action shall be brought and
no cause of action shall be asserted by or on behalf of the Company or any
affiliate of the Company against Indemnitee, Indemnitee’s

 

7

 

spouse, heirs, executors, or
personal or legal representatives after the expiration of two years from the
date of accrual of such cause of action, or such longer period as may be
required or permitted by applicable law under the circumstances. Any claim or
cause of action of the Company or its affiliate shall be extinguished and
deemed released unless asserted by the timely filing of a legal action within such
period; provided, however, that if any shorter
period of limitations is otherwise applicable to any such cause of action the
shorter period shall govern.

 

11.   Amendment of this Agreement. No supplement, modification,
or amendment of this Agreement shall be binding unless executed in writing by
both of the parties hereto. No waiver of any of the provisions of this
Agreement shall operate as a waiver of any other provisions hereof (whether or
not similar), nor shall such waiver constitute a continuing waiver. Except as
specifically provided herein, no failure to exercise and no delay in exercising
any right or remedy hereunder shall constitute a waiver thereof.

 

12.   Subrogation. In the event of payment under this Agreement,
the Company shall be subrogated to the extent of such payment to all of the
rights of recovery of Indemnitee, who shall execute all papers required and
shall do everything that may be necessary to secure such rights, including the
execution of such documents necessary to enable the Company effectively to
bring suit to enforce such rights.

 

13.   No Duplication of Payments. The Company shall not be liable
under this Agreement to make any payment in connection with any claim made
against Indemnitee to the extent Indemnitee has otherwise actually received
payment (under any insurance policy, Bylaw of the Company or otherwise) of the
amounts otherwise indemnifiable hereunder.

 

14.   Binding Effect. This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the parties hereto and their
respective successors, assigns, including any direct or indirect successor by
purchase, merger, consolidation, or otherwise to all, substantially all, or a
substantial part, of the business and/or assets of the Company, spouses, heirs,
and personal and legal representatives. The Company shall require and cause any
successor (whether direct or indirect by purchase, merger, consolidation, or
otherwise) to all, substantially all, or a substantial part, of the business
and/or assets of the Company, by written agreement in form and substance
satisfactory to Indemnitee, expressly to assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform if no such succession had taken place. This Agreement shall
continue in effect regardless of whether Indemnitee continues to serve as a
director or officer of the Company or of any other enterprise at the Company’s
request.

 

15.   Severability. If any provision (or portion thereof) of this
Agreement shall be held by a court of competent jurisdiction to be invalid,
void, or otherwise unenforceable, the remaining provisions shall remain
enforceable to the fullest extent permitted by law. Furthermore, to the fullest
extent possible, the remaining provisions of this Agreement shall be construed
so as to give effect to the intent manifested by the provision held invalid,
void, or unenforceable.

 

16.   Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of Nevada
applicable without giving effect to the principles of conflicts of laws.

 

8

 

17.   Notices. All notices, demands, service of process and other
communications required or permitted hereunder shall be made in writing and
shall be deemed to have been duly given if delivered by hand, against receipt,
mailed, postage prepaid, certified or registered mail, return receipt
requested, faxed (which is confirmed) or sent by an overnight courier service,
such as Federal Express, and addressed to the Company at:

 

Tenet Healthcare Corporation

13737 Noel Road, Suite 100

Dallas, Texas  
75240

Attn:  General
Counsel

 

and
to Indemnitee at Indemnitee’s address set forth on the signature page hereto.

 

Notice of change of address shall be effective only
when done in accordance with this Section. All notices complying with this Section shall
be deemed to have been received on the date of delivery or on the third
business day after mailing.

 

IN WITNESS WHEREOF, the parties hereto have duly
executed and delivered this Agreement as of the day specified above.

 

 

	
   

  	
  TENET HEALTHCARE CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  [Name of Executive Officer]

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  INDEMNITEE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [Name of Indemnitee]

  

 

9Exhibit 4.1

 

THIS NOTE
AND THE SECURITIES ISSUABLE UPON THE CONVERSION OF THIS NOTE HAVE BEEN ACQUIRED
FOR INVESTMENT ONLY AND NOT WITH THE INTENT OF FURTHER DISTRIBUTION, AND HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT
BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED, OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT THIS NOTE AND
THE SECURITIES UNDER THAT ACT UNLESS SOLD PURSUANT TO RULE 144 PROMULGATED
UNDER THAT ACT OR UNLESS THE SALE, PLEDGE, HYPOTHECATION OR TRANSFER IS
OTHERWISE EXEMPT FROM REGISTRATION. GRAYMARK PRODUCTIONS, INC. MAY REQUEST
A WRITTEN OPINION FROM COUNSEL AND IN FORM ACCEPTABLE TO GRAYMARK
PRODUCTIONS, INC., TO THE EFFECT THAT REGISTRATION IS NOT REQUIRED IN
CONNECTION WITH SUCH SALE, PLEDGE OR HYPOTHECATION, OR OTHER TRANSFER. THIS
NOTE OR ANY SECURITY ISSUABLE UPON THE CONVERSION OF THIS NOTE MUST BE
SURRENDERED TO GRAYMARK PRODUCTIONS, INC. AS A CONDITION PRECEDENT TO THE SALE,
PLEDGE, HYPOTHECATION OR ANY OTHER TRANSFER OF ANY INTEREST IN THIS NOTE OR ANY
SECURITY INTO WHICH THIS NOTE IS CONVERTIBLE.

 

GRAYMARK PRODUCTIONS, INC.

 

SENIOR PROMISSORY NOTE

 

	
  U.S.
  $750,000

  	
   

  	
  October 25, 2005       

  

 

FOR VALUE
RECEIVED, the undersigned, GRAYMARK PRODUCTIONS, INC. an
Oklahoma corporation, and all of its existing subsidiaries and subsidiaries
created after the date hereof (hereinafter called the “Company”), hereby
promises to pay to the order of            
or any future permitted holder of this Senior Promissory Note (the “Payee”),
at the principal office of the Payee set forth herein, or at such other place
as the holder may designate in writing to the Company, the principal sum of
SEVEN HUNDRED FIFTY THOUSAND DOLLARS (U.S. $750,000), or such other amount as may
be outstanding hereunder, together with all accrued but unpaid interest, in
such coin or currency of the United States of America as at the time shall be
legal tender for the payment of public and private debts and in immediately
available funds, as provided in this Senior Promissory Note (the “Note”).

 

Upon
the date of issuance of this Note the Company has no outstanding securities or
other financial instruments that rank senior or pari-passu to this Note.

 

The
Company shall not issue any securities or other financial instruments that rank
senior or pari-passu to this Note without the prior written consent of the
Payee.

 

 

1.                                       Principal and Interest Payments.  

 

(a)                                  The
Company shall repay in full the entire principal balance then outstanding under
this Note in the manner provided in Section 1(d) hereof on the first
to occur (the “Maturity Date”) of: (i) October 25, 2007; (ii) the
consummation of a Qualified Financing (as defined in Section 1(d) hereof);
or (iii) the acceleration of the obligations as contemplated by this
Note.  The Company may prepay all or any
part of this Note, in whole or in part at any time, as set forth in Section 6(d) hereof.

 

(b)                                 Interest
on the outstanding principal balance of this Note shall accrue at a rate of
eight percent (8%) per annum.  Interest
on the outstanding principal balance of the Note shall be computed on the basis
of the actual number of days elapsed and a year of three hundred and sixty
(360) days and shall be payable quarterly by the Company in cash or in shares of
the Company’s equity securities as contemplated in Section 1(d) hereof.  Furthermore, upon the occurrence of an Event
of Default that shall be continuing for more than thirty (30) consecutive days
following the Company’s receipt of Payee’s notice describing in reasonable
detail the occurrence of an Event of Default, then to the extent permitted by
law, the Company will pay interest to the Payee, payable on demand, on the
outstanding principal balance of the Note from the date of the Event of Default
until payment in full at the rate of eighteen percent (18%) per annum.

 

(c)                                  The
outstanding principal amount of this Note shall be secured by all assets of the
Company including but not limited to, all purchase agreements and any such
options or rights to acquire, all intellectual and real property, all assets
and properties of GrayMark Productions, Inc. and all of its existing
subsidiaries and subsidiaries created after the date hereof.

 

(d)                                 At
the Maturity Date, the outstanding principal amount of this Note plus all
accrued and unpaid interest herein shall be due and payable in cash in the
absence of a Qualified Financing by the Company on or before the Maturity Date
or, in the event of a Qualified Financing by the Company on or before Maturity
Date, automatically converted into equity securities of the Company which may
be issued in connection with the Qualified Financing by the Company of its
equity securities to certain investors; provided, however, the
Company receives aggregate gross cash proceeds in connection with a Qualified
Financing of at least $2,000,000 (excluding the conversion of this Note)
occurring on or before October 25, 2007, the outstanding principal amount
of this Note plus all accrued and unpaid interest herein shall automatically be
converted into shares of equity securities of the Company (the “Qualified
Financing”).  The principal amount
of this Note plus all accrued and unpaid interest shall convert into such
number of shares of equity securities of the Company equal to 120% of the
principal amount of this Note and all accrued interest outstanding divided by
the price per share of the equity securities sold in the Qualified Financing,
the maximum price or value of the Common Stock into which the indebtedness
evidenced by this Note converts shall not exceed the equivalent of $1.10 per
Common Stock share.  Upon the conversion
of this Note, the outstanding principal amount of this Note, together with
accrued interest hereon, shall be deemed to be the consideration for the Payee’s
interest in the equity securities upon consummation of the Qualified
Financing.  In consideration for the loan
evidenced by this Note, the Payee shall receive common stock purchase warrants
exercisable during a five-year period for the purchase of (i) 250,000
shares of the Company’s common stock, $.001 par value (the “Common Stock”) at
$2.00 per share, and (ii) 250,000 shares of Common Stock at $3.00 per
share (the “Common Stock Purchase Warrants”) in the form attached to this Note
as Exhibits A-1 and A-2.

 

 

2.                                       Payment on Non-Business Days. 
Whenever any payment to be made shall be due on a Saturday, Sunday or a
public holiday under the laws of the United States of America or the State of
Michigan, such payment may be due on the next succeeding business day and such
next succeeding day shall be included in the calculation of the amount of
accrued interest payable on such date.

 

3.                                       Representations, Warranties and Covenants
of the Company.  The Company represents, warrants and
covenants to the Payee as follows:

 

(a)                            The Company
has been duly incorporated and is validly existing and in good standing under
the laws of the state of Oklahoma, with full corporate power and authority to
own, lease and operate its properties and to conduct its business as currently
conducted.

 

(b)                           This
Note has been duly authorized, validly executed and delivered on behalf of the
Company and is a valid and binding obligation of the Company enforceable
against the Company in accordance with its terms, subject to limitations on
enforcement by general principles of equity and by bankruptcy or other laws
affecting the enforcement of creditors’ rights generally, and the Company has
full power and authority to execute and deliver this Note and to perform its
obligations hereunder.

 

(c)                            The
execution, delivery and performance of this Note will not (i) conflict
with or result in a breach of or a default under any of the terms or provisions
of, (A) the Company’s certificate of incorporation or by-laws, or (B) any
material provision of any indenture, mortgage, deed of trust or other material
agreement or instrument to which the Company is a party or by which it or any
of its material properties or assets is bound, (ii) result in a violation
of any material provision of any law, statute, rule, regulation, or any
existing applicable decree, judgment or order by any court, Federal or state
regulatory body, administrative agency, or other governmental body having
jurisdiction over the Company, or

 

3

 

any of its material
properties or assets or (iii) result in the creation or imposition of any
material lien, charge or encumbrance upon any material property or assets of
the Company or any of its subsidiaries pursuant to the terms of any agreement
or instrument to which any of them is a party or by which any of them may be
bound or to which any of their property or any of them is subject.   

 

(d)                           No
consent, approval or authorization of or designation, declaration or filing
with any governmental authority on the part of the Company is required in
connection with the valid execution and delivery of this Note.

 

(e)                            Upon
the date of issuance of this Note the Company has no outstanding securities or
other financial instruments that rank senior or pari-passu to this Note. The
Company shall not issue any securities or other financial instruments that rank
senior or pari-passu to this Note without the prior written consent of the
Payee.

 

(f)                              Within
ten (10) days following the occurrence of a Material Adverse Change, the
Company shall provide Payee written notification describing in reasonable
detail the events and circumstances constituting the basis for the Material
Adverse Change. For purposes of this Note, “Material Adverse Change” shall mean
(a) a material adverse change in the business, prospects, operations,
results of operations, assets, liabilities or condition (financial or
otherwise) of the Company taken as a whole, or (b) a material adverse
change in the business, prospects, operations, results of operations, assets,
liabilities or condition (financial or otherwise) of the Company, or (c) a
material adverse change in the motion picture industry as it relates to the
Company.  

 

4.                                       Events of Default. 
The occurrence of any of the following events shall be an “Event of
Default” under this Note:

 

(a)                            the
Company shall fail to make the payment of any amount of any principal
outstanding for a period of three (3) business days after the date such
payment shall

 

4

 

become due and payable
hereunder; or

 

(b)                           the
Company shall fail to make any payment of interest for a period of three (3) business
days after the date such interest shall become due and payable hereunder; or

 

(c)                            any
representation, warranty or certification made by the Company herein or in any
certificate or financial statement shall prove to have been false or incorrect
or breached in a material respect on the date as of which made; or

 

(d)                           the
holder of any indebtedness (“Indebtedness”) of the Company or any of its
subsidiaries shall accelerate any payment of any amount or amounts of principal
or interest on any indebtedness (the “Indebtedness”) (other than the
Indebtedness hereunder) prior to its stated maturity or payment date the
aggregate principal amount of which Indebtedness of all such persons is in
excess of $500,000, whether such Indebtedness now exists or shall hereinafter
be created, and such accelerated payment entitles the holder thereof to
immediate payment of such Indebtedness which is due and owing and such
indebtedness has not been discharged in full or such acceleration has not been
stayed, rescinded or annulled within ten (10) business days of such
acceleration; or  

 

(e)                            A
judgment or order for the payment of money shall be rendered against the
Company or any of its subsidiaries in excess of $500,000 in the aggregate (net
of any applicable insurance coverage) for all such judgments or orders against
all such persons (treating any deductibles, self insurance or retention as not
so covered) that shall not be discharged, and all such judgments and orders
remain outstanding, and there shall be any period of sixty (60) consecutive
days following entry of the judgment or order in excess of $500,000 or the
judgment or order which causes the aggregate amount described above to exceed
$500,000 during which a stay of enforcement of such judgment or order, by
reason of a pending appeal or otherwise, shall not be in effect; or

 

5

 

(f)                              the
Company shall (i) apply for or consent to the appointment of, or the
taking of possession by, a receiver, custodian, trustee or liquidator of itself
or of all or a substantial part of its property or assets, (ii) admit in
writing its inability to pay its debts as such debts become due, (iii) make
a general assignment for the benefit of its creditors, (iv) commence a
voluntary case under the Bankruptcy Code or under the comparable laws of any
jurisdiction (foreign or domestic), (v) file a petition seeking to take
advantage of any bankruptcy, insolvency, moratorium, reorganization or other
similar law affecting the enforcement of creditors’ rights generally, (vi) acquiesce
in writing to any petition filed against it in an involuntary case under the
Bankruptcy Code or under the comparable laws of any jurisdiction (foreign or
domestic), or (vii) take any action under the laws of any jurisdiction
(foreign or domestic) analogous to any of the foregoing; or

 

(g)                           a
proceeding or case shall be commenced in respect of the Company or any of its
subsidiaries without its application or consent, in any court of competent
jurisdiction, seeking (i) the liquidation, reorganization, moratorium,
dissolution, winding up, or composition or readjustment of its debts, (ii) the
appointment of a trustee, receiver, custodian, liquidator or the like of it or
of all or any substantial part of its assets or (iii) similar relief in
respect of it under any law providing for the relief of debtors, and such
proceeding or case described in clause (i), (ii) or (iii) shall continue
undismissed, or unstayed and in effect, for a period of thirty (30) consecutive
days or any order for relief shall be entered in an involuntary case under the
Bankruptcy Code or under the comparable laws of any jurisdiction (foreign or
domestic) against the Company or any of its subsidiaries or action under the
laws of any jurisdiction (foreign or domestic) analogous to any of the
foregoing shall be taken with respect to the Company or any of its subsidiaries
and shall continue undismissed, or unstayed and in effect for a period of
thirty (30) consecutive days.

 

(h)                           a
material impairment of the Company’s ability to perform its financial
obligations, or a material impairment of the enforceability or priority of
Payee’s creditor priority as a result of an action or failure to act on the
part of the Company,

 

6

 

5.                                       Remedies Upon An Event of Default. 
If an Event of Default shall have occurred and shall be continuing for
more than thirty (30) consecutive days following the Company’s receipt of Payee’s
notice describing in reasonable detail the occurrence of an Event of Default,
the Payee of this Note may at any time at its option, (a) declare the
entire unpaid principal balance of this Note, together with all interest
accrued hereon, due and payable, and thereupon, the same shall be accelerated
and so due and payable; provided, however, that upon the
occurrence of an Event of Default described in (i) Sections 4(f) and
(g), without presentment, demand, protest, or notice, all of which are hereby
expressly unconditionally and irrevocably waived by the Company, the
outstanding principal balance and accrued interest hereunder shall be
automatically due and payable, and (ii) Sections 4(a) through (e),
the Payee may demand the prepayment of this Note pursuant to Section 6
hereof; or (b) exercise or otherwise enforce any one or more of the Payee’s
rights, powers, privileges, remedies and interests under this Note or
applicable law.  No course of delay on
the part of the Payee shall operate as a waiver thereof or otherwise prejudice
the right of the Payee.  No remedy
conferred hereby shall be exclusive of any other remedy referred to herein or
now or hereafter available at law, in equity, by statute or otherwise.  Notwithstanding the foregoing, Payee agrees
that its rights and remedies hereunder are limited to receipt of cash or shares
of the Company’s equity securities in the amounts described herein.

 

6.                                       Prepayment Options.

 

(a)                            Prepayment.  Notwithstanding anything to the contrary
contained herein, the Payee shall have the right, at such Payee’s option, to
require the Company to prepay all of the sum of this Note at a price equal to
110% of the outstanding principal amount and any interest accrued and
outstanding under this Note (the “Prepayment Price”), provided,
that such prepayment is requested upon the occurrence of a Major Transaction
(as defined in Section 6(e) below). 
Nothing in this Section 6(a) shall limit the Payee’s rights
under Section 5 hereof.  

 

(b)                           Mechanics
of Prepayment at Option of Payee.  At
least thirty (30) days prior to the occurrence of a Major Transaction and
within one (1) day after the occurrence

 

7

 

of a Major Transaction,
the Company shall deliver written notice thereof via facsimile and overnight
courier (“Notice of a Prepayment Event”) to the Payee.  At any time on or after the earlier of the
Payee’s receipt of a Notice of a Prepayment Event and the Payee becoming aware
of a Major Transaction, the Payee may require the Company to prepay all of the
outstanding principal amount and any interest accrued and outstanding under
this Note by delivering written notice thereof via facsimile and overnight
courier (“Notice of Prepayment at Option of Payee”) to the Company.

 

(c)                            Payment
of Prepayment Price.  Upon the
Company’s receipt of a Notice of Prepayment at Option of Payee from the Payee,
the Company shall immediately notify the Payee by facsimile of the Company’s
receipt of a Notice of Prepayment at Option of Payee and the Payee which has
sent such a notice shall deliver to the Company this Note on or before the
consummation or closing of a Major Transaction.    The Company shall pay the Prepayment Price
to Payee at or prior to the closing of the Major Transaction; provided
that this Note shall have been so delivered to the Company.  If the Company shall fail to prepay all of
the Prepayment Price (other than pursuant to a dispute as to the arithmetic
calculation of the Prepayment Price), in addition to any remedy the Payee may
have under this Note, the Prepayment Price payable in respect of such unprepaid
Notes shall bear interest at the rate of two percent (2.0%) per each period of
thirty (30) consecutive days, pro rated for any period of less than thirty (30)
days until paid in full.  Until the
Company pays such unpaid Prepayment Price in full to the Payee, the Payee shall
have the option (the “Void Optional Prepayment Option”) to, in lieu of
prepayment, require the Company to promptly return to the Payee this Note that
was submitted for prepayment by Payee under this Section 6(c) and for
which the Prepayment Price has not been paid, by sending written notice thereof
to the Company via facsimile (the “Void Optional Prepayment Notice”).   Upon the Company’s receipt of such Void
Optional Prepayment Notice(s) and prior to payment of the full Prepayment Price
to Payee, (i) the Notice(s) of Prepayment at Option of Payee shall be null
and void with respect to this Note submitted for prepayment and for which the
Prepayment Price has not been paid and (ii) the Company shall immediately
return this Note submitted to the Company by the Payee for

 

8

 

prepayment under this Section 6(c) and
for which the Prepayment Price has not been paid.  A Payee’s delivery of a Void Optional
Prepayment Notice and exercise of its rights following such notice shall not
affect the Company’s obligations to make any payments which have accrued prior
to the date of such notice.

 

(d)                           Company’s
Prepayment Option.  The Company may
prepay, at the option of its Board of Directors, all or any portion of the
outstanding principal amount of this Note and the accrued and unpaid interest
thereon upon five (5) business days prior written notice to the Payee (the
“Company Prepayment Notice”) at a cash price equal to 110% of the sum of
the outstanding principal amount of this Note and any interest accrued and
outstanding (the “Company Prepayment Price”).  The Company may not deliver a Company
Prepayment Notice to the Payee unless the Company has clear and good funds for
a minimum of the amount it intends to prepay in a bank account controlled by
the Company.  The Company Prepayment
Notice shall state the date of prepayment (the “Company Prepayment Date”),
the Company Prepayment Price, the amount of the Note of such Payee to be
prepaid, the amount of accrued and unpaid interest through the Company
Prepayment Date and shall call upon the Payee to surrender to the Company on
the Company Prepayment Date at the place designated in the Company Prepayment
Notice such Payee’s Note.  The Company
Prepayment Date shall be no more than five (5) trading days after the date
on which the Payee is notified of the Company’s intent to prepay the Note (the “Company
Prepayment Notice Date”).  If the
Company fails to pay the Company Prepayment Price by the sixth (6th)
trading day following the Company Prepayment Notice Date, the prepayment will
be declared null and void and the Company shall lose its right to deliver a
Company Prepayment Notice to the Payee in the future.  On or after the Company Prepayment Date, the
Payee shall surrender the Notes called for prepayment to the Company at the
place designated in the Company Prepayment Notice and shall thereupon be
entitled to receive payment of the Company Prepayment Price.

 

(e)                            For
purposes of this Note, “Major Transaction” means the consummation of any
of the following transactions: (i) the consolidation, merger or other
business combination of the Company with or into a person or entity (other than
(A) pursuant to

 

9

 

a migratory merger
effected solely for the purpose of changing the jurisdiction of incorporation
of the Company, or (B) a consolidation, merger or other business
combination in which holders of the Company’s or any of its subsidiaries voting
power immediately prior to the transaction continue after the transaction to
hold, directly or indirectly, the voting power of the surviving entity or
entities necessary to elect a majority of the members of the board of directors
(or their equivalent if other than a corporation) of such entity or entities); (ii) the
sale or transfer of all or substantially all of the Company’s or any of its
subsidiaries’ assets; or (iii) the consummation of a purchase, tender or
exchange offer made to the holders of more than 30% of the outstanding shares
of the Company’s common stock; provided, however, the following
shall not be deemed a Major Transaction for purposes of this Note: (a) the
Proposed Financing; (b) a split, reverse split, dividend or distribution
with respect to the common stock of the Company which has been disclosed to the
Payee; (c) the tender, exchange or repricing of any securities of the
Company which are convertible into shares of common stock of the Company which
has been disclosed to the Payee.

 

7.                                       Replacement. 
Upon receipt of a duly executed, notarized and unsecured written
statement from the Payee with respect to the loss, theft or destruction of this
Note (or any replacement hereof), and without requiring an indemnity bond or
other security, or, in the case of a mutilation of this Note, upon surrender
and cancellation of such Note, the Company shall issue a new Note, of like
tenor and amount, in lieu of such lost, stolen, destroyed or mutilated Note.

 

8.                                       Parties in Interest, Transferability. 
This Note shall be binding upon the Company and its successors and
assigns and the terms hereof shall inure to the benefit of the Payee and its
successors and permitted assigns. This Note may be transferred or sold, subject
to the provisions of Section 18 of this Note, or pledged, hypothecated or
otherwise granted as security by the Payee.

 

9.                                       Amendments.  This Note may
not be modified or amended in any manner except in writing executed by the
Company and the Payee.

 

10

 

Notices.  Any notice, demand, request, waiver or other
communication required or permitted to be given hereunder shall be in writing
and shall be effective (a) upon hand delivery by telecopy or facsimile at
the address or number designated below (if delivered on a business day during
normal business hours where such notice is to be received), or the first
business day following such delivery (if delivered other than on a business day
during normal business hours where such notice is to be received) or (b) on
the second business day following the date of mailing by express courier
service, fully prepaid, addressed to such address, or upon actual receipt of
such mailing, whichever shall first occur. 
The Company will give written notice to the Payee at least thirty (30)
days prior to the date on which the Company closes its books or takes a record
(x) with respect to any dividend or distribution upon the common stock of the
Company, (y) with respect to any pro rata subscription offer to holders of
common stock of the Company or (z) for determining rights to vote with respect
to a Major Transaction, dissolution, liquidation or winding-up and in no event
shall such notice be provided to such holder prior to such information being
made known to the public.  The Company
will also give written notice to the Payee at least twenty (20) days prior to
the date on which dissolution, liquidation or winding-up will take place.

 

	
  Address of the
  Payee:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Address of the
  Company:

  	
   

  	
  GrayMark
  Productions, Inc.

  
	
   

  	
   

  	
  101 North
  Robinson, Suite 920

  
	
   

  	
   

  	
  Oklahoma City,
  OK 73102

  
	
   

  	
   

  	
  Attention: John
  Simonelli, CEO

  
	
   

  	
   

  	
  (405) 601-5300

  

 

10.                                 Governing Law. This Note shall be governed by and
construed in accordance with the internal laws of the State of Michigan,
without giving effect to the choice of

 

11

 

law provisions.  This Note shall not be interpreted or
construed with any presumption against the party causing this Note to be
drafted.

 

11.                                 Headings.  Article and
section headings in this Note are included herein for purposes of
convenience of reference only and shall not constitute a part of this Note for
any other purpose.

 

12.                                 Remedies, Characterizations, Other Obligations,
Breaches and Injunctive Relief.  The remedies
provided in this Note shall be cumulative and in addition to all other remedies
available under this Note, at law or in equity (including, without limitation,
a decree of specific performance and/or other injunctive relief), no remedy
contained herein shall be deemed a waiver of compliance with the provisions
giving rise to such remedy and nothing herein shall limit a Payee’s right to
pursue actual damages for any failure by the Company to comply with the terms
of this Note.  Amounts set forth or
provided for herein with respect to payments and the like (and the computation
thereof) shall be the amounts to be received by the Payee and shall not, except
as expressly provided herein, be subject to any other obligation of the Company
(or the performance thereof).

 

13.                                 Failure or Indulgence Not Waiver. 
No failure or delay on the part of the Payee in the exercise of any
power, right or privilege hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such power, right or privilege
preclude other or further exercise thereof or of any other right, power or
privilege.

 

14.                                 Enforcement Expenses. 
The Company agrees to pay all costs and expenses of enforcement of this
Note, including, without limitation, reasonable attorneys’ fees and expenses.

 

15.                                 Binding Effect.  
The obligations of the Company and the Payee set forth herein shall be
binding upon the successors and assigns of each such party, whether or not such
successors or assigns are permitted by the terms hereof.

 

12

 

16.                                 Compliance with Securities Laws. 
The Payee of this Note acknowledges that this Note is being acquired
solely for the Payee’s own account and not as a nominee for any other party,
and for investment, and that the Payee shall not offer, sell or otherwise
dispose of this Note other than in compliance with the laws of the United
States of America and as guided by the rules of the Securities and
Exchange Commission.  This Note and any
Note issued in substitution or replacement therefore shall be stamped or
imprinted with a legend in substantially the following form:

 

“THIS
NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAW AND MAY NOT BE SOLD, TRANSFERRED OR
OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER
APPLICABLE STATE SECURITIES LAWS OR GRAYMARK PRODUCTIONS INC. SHALL HAVE
RECEIVED AN OPINION OF ITS COUNSEL THAT REGISTRATION OF SUCH SECURITIES UNDER
THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS
IS NOT REQUIRED.”

 

17.                                 Severability. 
The provisions of this Note are severable, and if any provision shall be
held invalid or unenforceable in whole or in part in any jurisdiction, then
such invalidity or unenforceability shall not in any manner affect such
provision in any other jurisdiction or any other provision of this Note in any
jurisdiction.

 

18.                                 Consent to Jurisdiction. 
Each of the Company and the Payee (i) hereby irrevocably submits to
the jurisdiction of the United States District Court sitting in the Western
District of Michigan and the courts of the State of Michigan located in Ingham
county for the purposes of any suit, action or proceeding arising out of or
relating to this Note and (ii) hereby waives, and agrees not to assert in
any such suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of such court, that the suit, action or proceeding
is brought

 

13

 

in an inconvenient forum
or that the venue of the suit, action or proceeding is improper.  Each of the Company and the Payee consents to
process being served in any such suit, action or proceeding by mailing a copy
thereof to such party at the address set forth in Section 11 hereof and
agrees that such service shall constitute good and sufficient service of
process and notice thereof.  Nothing in
this Section 20 shall affect or limit any right to serve process in any
other manner permitted by law.

 

19.                                 Company Waivers. 
Except as otherwise specifically provided herein, the Company and all
others that may become liable for all or any part of the obligations evidenced
by this Note, hereby waive presentment, demand, notice of nonpayment, protest
and all other demands and notices in connection with the delivery, acceptance,
performance and enforcement of this Note, and do hereby consent to any number
of renewals of extensions of the time or payment hereof and agree that any such
renewals or extensions may be made without notice to any such persons and
without affecting their liability herein and do further consent to the release
of any person liable hereon, all without affecting the liability of the other
persons, firms or Company liable for the payment of this Note, AND DO HEREBY
WAIVE TRIAL BY JURY.

 

(a)                            No
delay or omission on the part of the Payee in exercising its rights under this
Note, or course of conduct relating hereto, shall operate as a waiver of such
rights or any other right of the Payee, nor shall any waiver by the Payee of
any such right or rights on any one occasion be deemed a waiver of the same
right or rights on any future occasion.

 

(b)                           THE
COMPANY ACKNOWLEDGES THAT THE TRANSACTION OF WHICH THIS NOTE IS A PART IS
A COMMERCIAL TRANSACTION, AND TO THE EXTENT ALLOWED BY APPLICABLE LAW, HEREBY
WAIVES ITS RIGHT TO NOTICE AND HEARING WITH RESPECT TO ANY PREJUDGMENT REMEDY
WHICH THE PAYEE OR ITS SUCCESSORS OR ASSIGNS MAY DESIRE TO USE.

 

14

 

IN
WITNESS WHEREOF, the Company has executed and delivered this
Note as of the date first written above.

 

	
   

  	
  GRAYMARK
  PRODUCTIONS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  John Simonelli,
  CEO

  

 

15

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