Document:

SENETEK
                  PLC

                Moderator:
                  Frank Massino

                08-17-2007/11:00
                  am CT

                Confirmation
                  # 13177281

              

      

      
 

      

      SENETEK
        PLC

      

      Moderator:
        Frank Massino

      August
        17, 2007

      11:00
        am CT

      

      

      
        	
                Operator:

              	
                Good
                  morning, my name is (Cassandra) and I will be your conference operator
                  today. At this time, I would like to welcome everyone to the shareholder
                  teleconference.

              
	 	 
	 	
                All
                  lines have been placed on mute to prevent any background noise.
                  After the
                  speaker’s remarks, there will be a question and answer session. If you
                  would like to ask a question during this time, simply press star
                  then the
                  number 1 on your telephone keypad. If you would like to withdraw
                  your
                  question, press star then the number 2 on your telephone
                  keypad.

              
	 	 
	 	
                This
                  conference call is being provided for informational and discussion
                  purposes and is not intended to provide and should not be relied
                  upon as
                  investment or advice or an opinion regarding the appropriateness
                  or
                  suitability of any investment. Nothing herein should be construed
                  to be an
                  offer to sell or a solicitation of an offer to buy any
                  securities.

              
	 	 
	 	
                This
                  discussion will contain forward looking statements regarding future
                  events. These statements are just predictions and are subject to
                  risks and
                  uncertainties that could cause the actual events or results to
                  differ
                  materially.

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      	 	
               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	 	
                These
                  risk and uncertainties include failure to get regulatory approval
                  for our
                  product candidates, market acceptance for approved products, management
                  of
                  rapid growth, risks of regulatory review and clinical trials, intellectual
                  property risks and the need to acquire additional
                  products.

              
	 	 
	 	
                We
                  would like to refer our audience to the documents that Senetek
                  files from
                  time to time with the Securities and Exchange
                  Commission.

              
	 	 
	 	
                I
                  would now like to turn it over to Bill O’Kelly, Chief Financial Officer of
                  Senetek PLC.

              
	 	 
	
                Bill
                  O’Kelly:

              	
                “Good
                  morning and thank you for taking the time to tune into Senetek's
                  shareholder's teleconference. I’m pinch hitting for Frank today in
                  covering our opening statements. Frank is here with me but has
                  laryngitis.
                  Later in the call we’ll take a few questions and he wants to save his
                  voice for that session. 

              

      

      

      This
        morning’s opening statement will cover the following topics:

      	·  	
              The
                recently announced Marketing Collaboration Agreement with
                Triax;

            

      	·  	
              A
                review of the second quarter operating
                results;

            

      	·  	
              A
                review of progress made on our strategic objectives;
                and

            

      	·  	
              PR
                and Investor relations initiatives planned for the balance of
                2007.

            

      

      Finally,
        we’ll open the call to a brief question and answer session.

      

      On
        August
        6th,
        we were
        pleased to announce a Marketing Collaboration Agreement with Triax Aesthetics.
        The Agreement grants Triax an exclusive license to sell skin care products
        labeled Senetek-Triax, containing our second generation cytokinin, in the
        ethical market channel in the US, Canada and certain Middle East countries.
        Our
        second generation cytokinins have shown in clinical tests to be faster acting
        and more effective than the best selling anti aging product in the physician
        market in North America and will be marketed as such by Triax. 

      

      
        
          
          

        

        
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                 SENETEK
                  PLC

                Moderator:
                  Frank Massino

                08-17-2007/11:00
                  am CT

                Confirmation
                  # 13177281

              

      

       

      For
        technical and competitive reasons we have not disclosed the specific compound
        covered by the Agreement and will not do so until a later date. 

      

      Triax
        Aesthetics and its affiliate, Triax Pharmaceuticals are New Jersey based
        specialty dermatology companies. The Company and its principals are well
        known
        and highly respected in the medical community. Triax is owned in the majority
        by
        investment affiliates of North Sound Capital, a $1.3 Billion Connecticut
        based
        private equity firm. 

      

      Senetek
        will receive all net revenues through 2008 and 50% of net revenues thereafter,
        including a guaranteed minimum of $10.8 million in net revenues for the calendar
        year 2008. 

      

      We
        will
        contribute periodic sales and marketing payments totaling $4.5 million in
        the
        first year of the Agreement for services including:

      	·  	
              Hiring,
                training and deployment of a dedicated sales force to promote and
                sell
                Senetek-Triax branded skin care products to dermatologists, plastic
                surgeons and other medical professionals in the ethical market in
                the
                licensed geographies; and

            

      	·  	
              Promotion
                and marketing of Senetek-Triax branded skin care products by a highly
                skilled Triax marketing team, including an extensive clinical seeding
                program, publication and evaluation of clinical results in medical
                peer
                review journals and a comprehensive media campaign in advance of
                and in
                conjunction with the product launch.

            

      After
        the
        first year, these and all other sales, marketing and order fulfillment costs
        are
        paid by Triax.

      

      
        
          
          

        

        
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                 SENETEK
                  PLC

                Moderator:
                  Frank Massino

                08-17-2007/11:00
                  am CT

                Confirmation
                  # 13177281

              

      

       

      We
        are
        very confident of the capabilities of Triax. They are highly respected and
        experienced professionals that understand the ethical skincare market and
        are
        excited about the potential of this product. Their objective is to be the
        market
        leader in the double-digit annual growth anti aging skin care market and
        to
        achieve more that $100 million in annual product sales. 

      

      Turning
        to the financials, our operating results for the second quarter of 2007 were
        in
        line with expectations set when we announced the fully paid license with
        Valeant
        earlier this year.

      

      Total
        revenues for the second quarter of 2007 were $471,000, compared to revenues
        of
        $2,005,000 in the second quarter of 2006. Currently, all of our revenues
        are
        derived from licensed monoclonal antibodies and this will remain the case
        until
        skincare revenues from new compounds are realized. At this time, we anticipate
        beginning some initial recognition of revenues related to our collaboration
        with
        Triax late in the fourth quarter of 2007 with the full effect beginning in
        2008.

      

      We
        reported a net loss of $397,000 for the second quarter and expect to report
        higher quarterly net losses in the third and fourth quarter of this year
        due
        principally to initial sales and marketing expenses related to the Triax
        collaboration and increased levels of research and development spending.
        We
        currently anticipate that we will be profitable in 2008 based on the economics
        of the Triax agreement.

      

      We
        ended
        the second quarter of 2007 with 22.2 million in cash. We will use cash in
        operations for the balance of 2007 but we anticipate that our cash position
        will
        remain very strong during that period, that we will return to cash flow positive
        operations in 2008 and that we will continue to be financially well positioned
        to execute on our strategy. 

      

      In
        July,
        we announced three key objectives for 2007 - 

      

      	·  	
              To
                assure that 2008 revenues equal or exceed lost revenues from the
                monetization of the Valeant agreement;

            

      	·  	
              To
                expedite development of new propriety compounds which possess differential
                advantages for commercialization; and

            

      	·  	
              To
                restructure the capitalization of the
                Company.

            

      

      
        
          
          

        

        
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                 SENETEK
                  PLC

                Moderator:
                  Frank Massino

                08-17-2007/11:00
                  am CT

                Confirmation
                  # 13177281

              

      

       

      Regarding
        our revenue objective; under the terms of our recently announced Marketing
        Collaboration Agreement with Triax, we will surpass annual revenues previously
        received from Valeant and other Kinetin licensees in 2008. This transaction
        represents only a beginning to the commercial opportunity for our second
        generation cytokinins. We are negotiating with several companies in various
        channels of distribution and geographies and expect to complete one or more
        commercial agreements by year’s end.

      

      In
        the
        area of new proprietary compounds, our product pipeline remains strong and
        we
        have made significant progress in advancing new and differentiated compounds
        through safety testing, bulk quantity synthesis and clinical trials. We continue
        or will soon begin testing several compounds for effectiveness for indications
        including acne rosacea, wound healing, acne vulgaris and skin
        whitening.

      

      Finally,
        on the subject of the capital structure, our Annual General Meeting, scheduled
        for November 12th
        in
        London, will include a shareholder resolution for approval of a reverse stock
        split and other resolutions, if required, to help facilitate a simplification
        of
        our capital structure.

      

      Our
        progress in 2007 has been significant but it has not translated to a market
        capitalization that management or the Board feels is reflective of the value
        of
        our enterprise. During the remainder of 2007, we plan a more concerted program
        of outreach to the investment community to articulate the value and potential
        of
        both our specialty dermatology and skin care business and
        our
        Invicorp® and Reliaject® assets. This program will include:

      

      	·  	
              Leveraging
                of the scientific and general interest marketing and promotion work
                performed by Triax; 

            

      	·  	
              Meetings
                with institutional investors and high net worth individuals in Europe
                in
                September;

            

      	·  	
              Participation
                to selective conferences including the Rodman & Renshaw Healthcare
                Conference, Nov 5 through 7 in New York;
                and

            

      	·  	
              Meetings
                with institutional investors and high net worth individuals in the
                U.S. in
                the fourth quarter.

            

       

      
        
          
          

        

        
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                 SENETEK
                  PLC

                Moderator:
                  Frank Massino

                08-17-2007/11:00
                  am CT

                Confirmation
                  # 13177281

              

      

       

      We
        appreciate your interest in Senetek and your continued support. We will now
        open
        the call for
        a
        brief question and answer period. Operator, we’ll take the first call
        please.

      

      
        	
                Operator:

              	
                At
                  this time, if you would like to ask a question, please press star
                  then the
                  number 1 on your telephone keypad. We will pause for just a moment
                  to
                  compile the Q&A roster.

              
	 	 
	 	
                Your
                  first question comes from Richard Sandafur.

              
	 	 
	
                Richard
                  Sandafur:

              	
                Hello,
                  gentlemen.

              
	 	 
	
                William
                  O’Kelly:

              	
                Good
                  morning, Richard.

              
	 	 
	
                Richard
                  Sandafur:

              	
                I
                  have a question about the rights that we have for the anti-cancer
                  technology for brain tumors. I haven’t heard anything about that for a
                  while. Are we still doing anything with that?

              
	 	 
	
                Frank
                  Massino:

              	
                Richard,
                  this is Frank. Yes, we are. Quite frankly, the situation is such
                  that the
                  patent application was just filed in July. It is definitely new
                  technology.

              
	 	 
	 	
                We
                  do have a lot of clinical success with the compound in Poland.
                  And as I
                  mentioned to you before on previous shareholder teleconferences,
                  we are
                  not going to develop that product ourselves but look for
                  partners.

              

      

      
        
          
          

        

        
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               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	
                Richard
                  Sandafur:

              	
                Okay.
                  Is this something that we would probably maintain as part of our
                  portfolio? I mean, I realize that you’re saying that we wouldn’t actually
                  be doing all of the detail work ourselves but we’ve been talking about
                  some of the other things like Invicorp®
                  and so forth moving that away. But this would be, I gather from
                  what
                  you’re saying, be something that we would retain?

              
	 	 
	
                Frank
                  Massino:

              	
                Yes,
                  that is correct.

              
	 	 
	
                Richard
                  Sandafur:

              	
                Okay.
                  Great. Thanks for your good work.

              
	 	 
	
                Frank
                  Massino:

              	
                Sure,
                  thank you, Richard.

              
	 	 
	
                William
                  O’Kelly:

              	
                Operator,
                  we’ll take the next question please.

              
	 	 
	
                Operator:

              	
                Your
                  next question comes from Tom Seymour, a private
                  investor.

              
	 	 
	
                Tom
                  Seymour:

              	
                Congratulations
                  again guys. I’m very impressed by the Triax deal. Frank, two questions if
                  you can on that, I know you said you can’t tell us which compound or
                  compound but is this for one or more than one compound? And how
                  many years
                  is this deal for?

              
	 	 
	
                Frank
                  Massino:

              	
                We
                  are committed, Tom, to one compound contractually.

              
	 	 
	
                Tom
                  Seymour:

              	
                Okay.

              
	 	 
	
                Frank
                  Massino:

              	
                The
                  deal that we have here is that Triax Aesthetics, Triax Pharma is
                  an
                  extension of Senetek, it is essentially our sales and marketing
                  force. It
                  would be unwise to go into that channel of distribution - and by
                  the way
                  the agreement is limited to the ethical marketplace - the physician
                  market, with another company particularly with Senetek’s name on the
                  product.

              

      

      
        
          
          

        

        
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               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	 	
                So
                  the reason that we’ve done this is, we feel that we’re going to have a
                  very long term lasting relationship with Triax. The agreement quite
                  frankly will continue as long as it’s successful.

              
	 	 
	 	
                The
                  fact of the matter is there is a reason that Senetek owns the trademark
                  and Senetek’s name will be on the packaging. 

              
	 	 
	
                Tom
                  Seymour:

              	
                Oh
                  - okay. Can you give us any updates on the Invicorp®?
                  Anything happening there?

              
	 	 
	
                Frank
                  Massino:

              	
                The
                  Invicorp®
                  approval process for the U. S. is going along extremely well. We’re very
                  pleased with Plethora’s activity and the progress that they’re making and
                  the communications they’ve had with the FDA.

              
	 	 
	 	
                They’re
                  extremely positive. They’re actually more bullish than I am, which is
                  really interesting. But they do have a thought leader in the field
                  that’s
                  running the program. So we do hope that they’re actually correct in their
                  target in having the product available in the U. S. in
                  2009.

              
	 	 
	 	
                In
                  the European Union, we actually quite candidly aren’t as pleased with some
                  of the progress that’s being made there; although, there is progress and
                  they still maintain that we’ll have some approvals in Europe before year
                  end.

              
	 	 
	
                Tom
                  Seymour:

              	
                Okay,
                  final question, the mention there of the reverse stock split, if
                  you could
                  maybe expand on what that involves and if that also ties into the
                  migration of America or stock buy backs or any of that? Could you
                  give us
                  any more information about what that’s
                  doing?

              

      

      
        
          
          

        

        
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               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	
                Frank
                  Massino:

              	
                I’m
                  going to go ahead and start then I will turn it over to Bill. The
                  point
                  that I want everyone to understand, the reason that we’re focusing on
                  correcting our current capital structure, it’s because it’s truly a
                  barrier to accomplishing external growth through mergers or
                  acquisition.

              
	 	 
	 	
                I
                  have to tell you that I’ve been in this industry a long time. We have a
                  lot of calls from people wanting to get together. They’re extremely
                  impressed with what we’ve done. But, it’s amazing - they look at our
                  shareholder account and they look at our structure and they say,
                  wow, this
                  is going to be a nightmare.

              
	 	 
	 	
                So
                  we feel it’s really important that we do this. And as far as the process
                  itself, I’ll turn it over to Bill.

              
	 	 
	
                William
                  O’Kelly:

              	
                Well,
                  in terms of the specifics, Tom, we are currently developing the
                  proxy
                  materials that will be sent out in advance of the meeting that
                  we
                  mentioned on November 12th. And a number of the details relative
                  to the
                  things that we are going to do will be contained in those
                  materials.

              
	 	 
	
                Tom
                  Seymour:

              	
                Okay.
                  Is there anything else that you can tell us about at this time?
                  Or do we
                  want to wait and see the materials?

              
	 	 
	
                William
                  O’Kelly:

              	
                Only
                  that our strategy and our aim is towards simplification, towards
                  getting
                  away from some of the complexities with respect to both operating
                  in a
                  dual environment and also with a significant number of very small
                  shareholders.

              
	 	 
	
                Tom
                  Seymour:

              	
                Great.
                  Okay, well you’ve answered my questions and again congratulations on a
                  good job guys.

              
	 	 
	
                William
                  O’Kelly:

              	
                Thank
                  you.

              

      

      
        
          
          

        

        
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               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	
                Frank
                  Massino:

              	
                Thanks,
                  Tom.

              
	 	 
	
                William
                  O’Kelly:

              	
                Operator,
                  we’ll take the next question please.

              
	 	 
	
                Operator:

              	
                Your
                  next question comes from Hayes Martin, private
                  investor.

              
	 	 
	
                Hayes
                  Martin:

              	
                Hi,
                  Frank.

              
	 	 
	
                Frank
                  Massino:

              	
                Hi,
                  Hayes.

              
	 	 
	
                Hayes
                  Martin:

              	
                I
                  have to admit to you that when the Triax deal was originally announced,
                  I
                  was somewhat skeptical. I had never heard of them and had to do
                  a little
                  further digging to find out who they are. Now that I understand
                  it better,
                  it sounds to me like it’s a terrific deal.

              
	 	 
	 	
                And
                  I gather that you must have been negotiating or talking to them
                  for some
                  time and that they’ve been doing their own due diligence on your compounds
                  before they would commit to such a deal. Am I correct?

              
	 	 
	
                Frank
                  Massino:

              	
                Yes,
                  that’s correct. I’ve actually known Leonard Mazur, the Chief Operating
                  Officer and a key principle in the company for over 15 years. And
                  we
                  actually had been negotiating this deal for almost a year and there’s been
                  a lot of evolution in the structuring of the deal
                  itself.

              
	 	 
	 	
                And
                  quite candidly to get the type of deal established the way we have,
                  it did
                  take a lot of effort and a lot of convincing. Probably the convincing,
                  Hayes, was the fact that we have some great
                  technology.

              

      

      
        
          
          

        

        
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                 SENETEK
                  PLC

                Moderator:
                  Frank Massino

                08-17-2007/11:00
                  am CT

                Confirmation
                  # 13177281

              

         

      

      
        	 	 
	
                Hayes
                  Martin:

              	
                Right,
                  Frank, that was the second question I just wanted to ask. I - when
                  I go -
                  I live in New York City and when I go to the cosmetics counters
                  at the
                  Macy’s and Bloomingdale’s and Saks Fifth Avenue, I see endless skin care
                  and anti-aging type of products - high end type of products made
                  primarily
                  with a variety of botanicals.

              
	 	 
	 	
                And
                  I go on the website of Nicholas Perricone, who’s well known, the Yale
                  professor, who has a combination of lipoic acid and green tea and
                  DMAE, et
                  cetera, et cetera.

              
	 	 
	 	
                Do
                  you believe that your compound - your second generation compounds
                  have
                  some unique features not found in those numerous other compounds
                  found in
                  the cosmetic products that are out there today?

              
	 	 
	
                Frank
                  Massino:

              	
                Unequivocally,
                  yes. We have clinically tested our compounds, two of them. We have
                  two
                  ready for market, PRK124 and 4HBAP. They both have different
                  attributes.

              
	 	 
	 	
                There
                  is one of the compounds that has tremendous potential as a skin
                  whitener.
                  We have a major cosmetic company that has done extensive testing
                  with it.
                  They’ve not seen anything that has done as well particularly being
                  non-toxic.

              
	 	 
	 	
                We
                  do have to say that Senetek subscribes to good science. That’s one thing
                  that differentiates our compounds and that’s probably the reason Kinerase
                  was so successful because we did do all of the clinical testing
                  just as if
                  you were to do a filing for a new drug application.

              
	 	 
	 	
                We
                  will continue to test the compounds. Currently at the University
                  of
                  California Irvine, we have an ongoing study with PRK124 for acne
                  rosacea.
                  It’s early but it’s interesting. The patients are all asking where can you
                  buy the product.

              

      

      
        
          
          

        

        
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               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	 	
                We
                  definitely won’t put a product out in the marketplace unless it has
                  efficacy and a great safety profile.

              
	 	 
	
                Hayes
                  Martin:

              	
                So,
                  Frank, it’s not just a matter where these things work faster than did
                  Kinetin but they also address conditions that Kinetin did not address
                  or
                  they do it better, am I correct?

              
	 	 
	
                Frank
                  Massino:

              	
                Yes,
                  they do exceed Kinetin. I don’t want to knock Kinetin because Kinetin’s a
                  great product. It is the leading selling anti-aging product in
                  the
                  dermatology market in North America but the fact of the matter
                  is PRK124
                  and 4HBAP have some really significant attributes that really make
                  them
                  what we consider to be superior compounds.

              
	 	 
	
                Hayes
                  Martin:

              	
                Well,
                  it sounds like you have a very exciting pipeline there, Frank and
                  really
                  good luck to you on that.

              
	 	 
	
                Frank
                  Massino:

              	
                Appreciate
                  that, Hayes.

              
	 	 
	
                William
                  O’Kelly:

              	
                Operator,
                  we’ll take the next question, please.

              
	 	 
	
                Operator:

              	
                Your
                  next question comes from Richard Lindhart from Opus
                  Capital.

              
	 	 
	
                Richard
                  Lindhart:

              	
                Thank
                  you. Good morning, guys.

              
	 	 
	
                William
                  O’Kelly:

              	
                Good
                  morning, Richard.

              
	 	 
	
                Frank
                  Massino:

              	
                Good
                  morning, Richard.

              

      

      
        
          
          

        

        
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                 SENETEK
                  PLC

                Moderator:
                  Frank Massino

                08-17-2007/11:00
                  am CT

                Confirmation
                  # 13177281

              

      
        	 	 
	
                Richard
                  Lindhart:

              	
                Couple
                  of questions on the Triax deal. First of all, from our reading
                  of it,
                  Senetek is paying for the manufacturing costs of the product. Is
                  that
                  correct? Are there any other costs that you’ll be paying ongoing out of
                  revenues? And what do you expect those costs to be as a percentage
                  of your
                  share of the revenue?

              
	 	 
	
                Frank
                  Massino:

              	
                The
                  fact of the matter is we are paying for the cost of goods sold.
                  Absolutely
                  and the reason behind that, Richard, is because we want to maintain
                  to
                  control of the product development and know exactly what sales
                  are.

              
	 	 
	 	
                As
                  far as costs of sales, for this type of product they’re not really
                  significant. They’ll probably be less than 10% in that
                  ballpark.

              
	 	 
	
                Richard
                  Lindhart:

              	
                Ten
                  percent of total revenues so maybe 20% of your share of the
                  revenue?

              
	 	 
	
                Frank
                  Massino:

              	
                Bill,
                  do you want to clarify that.

              
	 	 
	
                William
                  O’Kelly:

              	
                Yes,
                  that would be approximately what it would be, Richard.

              
	 	 
	
                William
                  O’Kelly:

              	
                You
                  know, we don’t want to get into specifics relative to costing but as Frank
                  mentioned we have the luxury of being in a business where the cost
                  is -
                  the costs are comparatively low relative to the
                  revenues.

              
	 	 
	
                Richard
                  Lindhart:

              	
                Other
                  than the $4.5 million first year marketing costs - or marketing
                  contribution you’re making, are there any other ongoing costs that you’ll
                  be paying as your - as partner in this venture with
                  Triax?

              

      

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

      	 	
               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	
                Frank
                  Massino:

              	
                We
                  have no contractual commitments other than the cost of goods sold
                  going
                  forward. Okay. And quite frankly, I want to point out that the
                  20% in my
                  opinion is a little bit high, Richard. Actually I think it’s quite high
                  but it should give you a ballpark that you can look at.

              
	 	 
	 	
                So
                  we definitely look at this as a partnership and we definitely want
                  to
                  continue to study the compounds. We want to differentiate these
                  compounds
                  far beyond anything that’s in the market because they do have some really
                  unique attributes. So we probably will on our own dime do some
                  clinical
                  trials - additional clinical trials.

              
	 	 
	
                Richard
                  Lindhart:

              	
                Okay.
                  You know obviously Triax has good backers, brand name guys running
                  the
                  company as well but can you tell us a little more about them in
                  terms of
                  what products they’ve actually acquired or licensed that they have out in
                  the market today? Any sense of what their revenues might be currently?
                  And
                  in particular what they’re doing in the dermatology
                  channel?

              
	 	 
	
                Frank
                  Massino:

              	
                Yes,
                  I think we can safely do that. First and foremost, I think the
                  bios of the
                  people running the company are quite impressive. They’ve been associated
                  with some of the leading dermatology companies. Leonard Mazur’s been a
                  founding executive of Medicis, which is the leading dermatology
                  company as
                  far as sales in North America. He also founded Genesis and sold
                  it to
                  Pierre Fabre; was President of Pierre Fabre U. S.

              
	 	 
	 	
                Joe
                  Krivulka has a very impressive background. He was founder of Bertek
                  Pharmaceuticals and a co-founder of Reliant
                  Pharmaceuticals.

              
	 	 
	 	
                So
                  we know that the capabilities of these people are extremely great.
                  Triax
                  has been in business in the U. S. for about four years. Their revenues
                  -
                  they are a private company, I don’t know if I can really state what they
                  do but in the first couple years they did achieve significant revenues
                  and
                  multi-digit million dollars worth of
                  income.

              

      

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

      	 	
               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	 	
                Based
                  on the fact that they did raise a significant amount of money,
                  they do
                  have a Tretin-X, which is a brand of retinoic acid. They have Minocin,
                  which is minocycline, an antibiotic. They are acquiring - I don’t know if
                  they’ve announced it but they’re acquiring a steroid.

              
	 	 
	 	
                They
                  do anticipate without our products to be over $100 million in annual
                  sales
                  this year. The amount of money that they raised recently is quite
                  significant. It’s upwards to $200 million.

              
	 	 
	
                Richard
                  Lindhart:

              	
                Really?

              
	 	 
	
                Frank
                  Massino:

              	
                So
                  they’re - we feel very well funded and very well backed. But most
                  importantly, during the American Academy of Dermatology, and again
                  I spent
                  many years in this area, we have had our scientists go from booth
                  to booth
                  and they were most impressed with the caliber of sales representation
                  and
                  marketing that Triax has presented.

              
	 	 
	
                Richard
                  Lindhart:

              	
                And
                  is - okay that sounds great. Is - what’s the basis of their goal of $100
                  million of annual sales?

              
	 	 
	
                Frank
                  Massino:

              	
                Well,
                  as you probably know right now, Kinetin, Kinerase does, nearly
                  $40 million
                  in the U. S. derm market. The fact of the matter is, is that Valeant’s
                  been a tremendous partner.

              
	 	 
	 	
                I
                  would have to say that we probably have a more aggressive marketing
                  partner with Triax. And the fact of the matter is, is that these
                  products,
                  let’s just say this is if we so give them more than one, we’re not
                  contractually committed to do so, are better than the existing
                  products in
                  the marketplace.

              

      

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

      	 	
               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	 	
                And
                  they have tremendous relationships with the thought leaders and
                  they take
                  a completely different marketing approach. I think you’ll see a lot of
                  media attention put behind these products. I think you’ll see publications
                  in Medical Journal and I just think the products themselves deserve
                  to be
                  a $100 million product.

              
	 	 
	
                Richard
                  Lindhart:

              	
                What
                  kind of either commitments or just indications did you get from
                  Triax of
                  the resources they’re going to put into marketing?

              
	 	 
	
                Frank
                  Massino:

              	
                We
                  have worked out the number of dedicated sales people that will
                  be utilized
                  behind the product. We currently are working together on a marketing
                  program.

              
	 	 
	 	
                As
                  you probably know, Richard, the fact of the matter is, is that
                  Senetek
                  takes a strong hand in the marketing itself. This is a Triax Senetek
                  relationship. They have the cost of order fulfillment and sales
                  and
                  marketing but we definitely have the responsibility to work together
                  as
                  far as developing the program.

              
	 	 
	 	
                The
                  fact of the matter is there is just no way that they’re going to make
                  significant investments and put their name out there and then come
                  at year
                  end of 2008 and not have been able to go ahead and pay us the $10.8
                  million.

              
	 	 
	 	
                So
                  they definitely have a major financial commitment already made
                  and plan to
                  do much more.

              
	 	 
	
                Richard
                  Lindhart:

              	
                I
                  mean do you know how much they’re going to allocate towards advertising,
                  PR, getting into publications, things like
                  that?

              

      

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

      	 	
               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	
                Frank
                  Massino:

              	
                We
                  do but we wouldn’t go ahead and share that. They’re a private company.
                  Plus the fact that we certainly would not want to tip our hand
                  to the
                  competition at this point in time.

              
	 	 
	
                Richard
                  Lindhart:

              	
                I
                  can understand that. One last question, Frank, on Triax, are you
                  going to
                  be marketing the product - are you looking for another agreement
                  for the -
                  I guess for the non-ethical pharma channels? And - I thought maybe
                  in a
                  prior call you had mentioned that.

              
	 	 
	
                Frank
                  Massino:

              	
                Yes,
                  unequivocally. Richard, we definitely want to re-emphasize the
                  fact of the
                  matter is the Triax agreement is only for select territories North
                  America, select territories in the Middle East for the physician
                  channel,
                  open to deals with other dermatological companies in Europe and
                  India.

              
	 	 
	 	
                We
                  also have all the other channels open to us, whether it be the
                  prestige or
                  the spa market. And we do plan on accelerating our efforts in those
                  areas
                  and we do anticipate as Bill had indicated that we will have at
                  least one
                  other agreement signed before the end of the year.

              
	 	 
	
                Richard
                  Lindhart:

              	
                And
                  - wouldn’t it - if you go heavily into - in the U. S. and into the spa
                  channel or the prestige channel, doesn’t that undercut what Triax is
                  trying to accomplish?

              
	 	 
	
                Frank
                  Massino:

              	
                No,
                  not at all, based on the fact that there’ll be differentiation in product
                  formulation and concentration. And, you know, we’ve seen that work before,
                  I will give you a very specific
                  example.

              

      

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

      	 	
               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	 	
                When
                  Kinerase had the lead on the exclusivity in the physician market
                  in the U.
                  S. when I first licensed it back in early 1999 and 18 months later
                  Revlon
                  came in with Almay and there was great concern amongst the management
                  at
                  ICN at the time, they thought they were going to be selling this
                  for
                  $20.00. It’s going to be sold for $20.00 a tube compared to the $100.00,
                  $125.00 Kinerase was selling for.

              
	 	 
	 	
                Oddly
                  enough when Almay came out and they would even be at the dermatology
                  meeting, the Kinerase sales took off. It was just incredible. They
                  don’t
                  sell against each other and there is really a differentiation between
                  the
                  formulations and the products themselves and their
                  positioning.

              
	 	 
	
                Richard
                  Lindhart:

              	
                Got
                  it. Okay, terrific. Well, congratulations again and thanks for
                  sharing all
                  this information with us.

              
	 	 
	
                Frank
                  Massino:

              	
                Thank
                  you, Richard.

              
	 	 
	
                William
                  O’Kelly:

              	
                Operator,
                  we’ll take one more question if there’s one in queue.

              
	 	 
	
                Operator:

              	
                Your
                  next question comes from John Marr of eTrade.

              
	 	 
	
                John
                  Marr:

              	
                Yes,
                  hello.

              
	 	 
	
                Frank
                  Massino:

              	
                Hello,
                  John.

              
	 	 
	
                John
                  Marr:

              	
                Yes,
                  we had - I had a similar company. It was Encore Medical, used to
                  be
                  Rehabilicare merged into them and they were Europe, U. S. and Canada
                  and
                  that was a big plus for them.

              
	 	 
	 	
                Sounds
                  like you’re in a similar area. They were using electronics and then they
                  also had some skin products like you have. And I think that was
                  a big help
                  to have the worldwide market.

              

      

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

      	 	
               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	 	
                One
                  of our other companies had a one for 60 reverse split and that
                  was a real
                  killer. I assume your more like one for five or ten.

              
	 	 
	
                Frank
                  Massino:

              	
                Well,
                  yes, I think one for 60 is somewhat extreme and...

              
	 	 
	
                John
                  Marr:

              	
                That
                  really hurt us.

              
	 	 
	
                Frank
                  Massino:

              	
                Right,
                  well I think that first of all that you need to know that obviously
                  the
                  shareholders have to approve this and second quite frankly what
                  we’re
                  really trying to do is we’re trying to have a manageable number of
                  shareholders in the sense that we now have upwards of 15,000 individual
                  shareholders, John. That’s a lot of shareholders. Okay.

              
	 	 
	
                John
                  Marr:

              	
                (Unintelligible).

              
	 	 
	
                Frank
                  Massino:

              	
                Very
                  costly. So what we’re trying to do here is that we are trying to
                  accomplish in having an investment banker support us in that they
                  may -
                  might make an offer to purchase some of the shares during the reverse
                  split as well.

              
	 	 
	 	
                We’re
                  very conscious of the fact that we want to keep the share price
                  up. You
                  know, if you look at the filing today with the form fours, you’ll notice
                  that Bill and I bought shares and I’m sure that there’ll be other insiders
                  buying shares and it’s just the beginning. So we have a vested interest
                  here to keep the share price up.

              
	 	 
	
                John
                  Marr:

              	
                Right.
                  The only way I could recover from the one from 60 was buy in afterwards
                  and then that worked out all right but I think I real - I think
                  you
                  definitely need to get up into the $2.00, $3.00 range to start
                  with
                  because better for financing and let and then - will you buy out
                  some of
                  the small shareholders then?

              

      

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

      	 	
               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	
                Frank
                  Massino:

              	
                That’s
                  our idea; absolutely. That’s what we’re working on. And I - no guarantees
                  but that’s really one of the - that’s a critical element of what we’re
                  trying to accomplish.

              
	 	 
	 	
                And,
                  John, I did state earlier and I want everybody to understand this.
                  We’re
                  not doing a reverse stock split just to be doing a reverse stock
                  split. I
                  have to tell you that we are in negotiations with companies for
                  potential
                  mergers, acquisitions and which could be accretive.

              
	 	 
	 	
                They
                  are basically petrified when we sit down and go over the capital
                  structure
                  and say we have 15,000 individual shareholders. First of all, they
                  question whether or not we’re ever going to be able to get approval for
                  such a deal. They don’t want to put the emphasis or the effort behind it
                  if the chance of getting shareholder approval is low.

              
	 	 
	 	
                And
                  the other thing is they don’t want to take on 15,000 shareholders. So we
                  have to do something. It is a barrier to external growth at this
                  point in
                  time. And that is the reason. This is not something that’s being done to
                  artificially, basically make the company look better. I want you
                  to know
                  that.

              
	 	 
	
                John
                  Marr:

              	
                Right,
                  yes. I’m fully supportive of that. I think you’ve had a real good deal on
                  your last sale and looks like things are good.

              
	 	 
	
                Frank
                  Massino:

              	
                Appreciate
                  that, John.

              
	 	 
	
                John
                  Marr:

              	
                Yes.

              

      

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

      	 	
               SENETEK
                PLC

              Moderator:
                Frank Massino

              08-17-2007/11:00
                am CT

              Confirmation
                # 13177281

            

      

      
        	 	 
	
                Frank
                  Massino:

              	
                Thank
                  you for your support.

              
	 	 
	
                William
                  O’Kelly:

              	
                Okay,
                  thanks very much everyone for your participation today and your
                  support.
                  We look forward to speaking with you again soon and updating you
                  on our
                  progress. Operator?

              
	 	 
	
                Operator:

              	
                Thank
                  you for participating in today’s shareholder teleconference. You may now
                  disconnect.

              

      

      

      

      ENDAMENDMENT
      NO. 2
      AND WAIVER

     

    This Amendment
      No. 2 and Waiver (this
      "Agreement")
      dated
      as of August 15, 2007 (the "Effective
      Date"),
      is by
      and among Tekoil
      and Gas Gulf Coast, LLC,
      a
      Delaware limited liability company (the "Company"),
      Tekoil
      & Gas Corporation,
      a
      Delaware corporation, as guarantor (the "Guarantor"),
      the
      lenders party to the Credit Agreement described below ("Lenders"),
      J.
      Aron & Company,
      as Lead
      Arranger and as Syndication Agent (in such capacities, "Syndication
      Agent"),
      and
J.
      Aron & Company,
      as
      Administrative Agent for such Lenders (together with its permitted successors
      in
      such capacity, the "Administrative
      Agent")
      and as
      counterparty to the Company under the ISDA Agreement referred to below (in
      such
      capacity, "Lender
      Counterparty").

     

    RECITALS

     

    A.  
Reference
      is made to that certain Credit and Guaranty Agreement dated as of May 11,
      2007 among the Company, the Guarantor, the Lenders, the Syndication Agent and
      the Administrative Agent (as amended or supplemented to the date hereof, the
      "Credit
      Agreement").
      Reference is further made to that certain ISDA Master Agreement dated as of
      May
      11, 2007 (as amended, supplemented, or restated to the date hereof, and together
      with all confirmations issued thereunder, the "ISDA
      Agreement").

     

    B.  
Subject
      to the terms and conditions of this Agreement, the Company, the Guarantor,
      the
      Lenders, the Syndication Agent, the Administrative Agent and the Lender
      Counterparty, as applicable, wish to (i) make certain amendments to the Credit
      Agreement as provided herein and (ii) provide a waiver for the Waiver Defaults,
      as defined below.

     

    NOW
      THEREFORE, in consideration of their mutual undertakings, the Company, the
      Guarantor, the Lenders, the Syndication Agent, the Administrative Agent and
      the
      Lender Counterparty hereby agree as follows:

     

    Section
      1.  Definitions
      and Interpretations.
      As used
      in this Agreement, each of the terms defined in the opening paragraph and the
      Recitals above shall have the meanings assigned to such terms therein. Each
      term
      defined in the Credit Agreement and used herein without definition shall have
      the meaning assigned to such term in the Credit Agreement, unless expressly
      provided to the contrary. Article, Section, Schedule, and Exhibit references
      are
      to this Agreement, unless otherwise specified. Paragraph headings have been
      inserted in this Agreement as a matter of convenience for reference only and
      it
      is agreed that such paragraph headings are not a part of this Agreement and
      shall not be used in the interpretation of any provision of this
      Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Section
      2.  Waiver.
      

     

    (a)  The
      Company hereby acknowledges the existence of the following Events of Default
      (the "Waiver
      Defaults"):
      (i)
      the Company did not furnish the title opinions required by the Credit Agreement
      (the "Post-Closing
      Title Opinions")
      on or
      before July 23, 2007, which constitutes an Event of Default under the Credit
      Agreement, (ii) none of the following occurred on or before August 9, 2007:
      (A) the occurrence of the Required Capital Date, (B) the deposit of at
      least $5,000,000 of the $7,500,000 contributed by Parent to Company on the
      Required Capital Date in the Collateral Account to be held under the control
      of
      Administrative Agent as cash collateral and applied to Other Permitted Capital
      Expenditures and (C) the repayment in full of the insurance premium
      financing Indebtedness described on Schedule 6.1 to the Credit Agreement from
      the $7,500,000 contributed by Parent to Company on the Required Capital Date,
      which constitutes an Event of Default under the Credit Agreement, and (iii)
      the
      existence of the foregoing Events of Default under the Credit Agreement
      constitutes an Event of Default under the ISDA Agreement.

     

    (b)  Subject
      to the terms and conditions of this Agreement, the Lenders and the Lender
      Counterparty, as applicable, hereby waive the Waiver Defaults. The waiver by
      the
      Lenders and the Lender Counterparty described in this Section 2 is contingent
      upon the satisfaction of the conditions precedent set forth below in this
      Agreement and is limited to the Waiver Defaults. Such waiver shall not be
      construed to be a consent to or a permanent waiver of any Section covered by
      either of the Waiver Defaults or any other terms, provisions, covenants,
      warranties or agreements contained in the Credit Agreement, the ISDA Agreement,
      or in any of the other Transaction Documents. The Lenders and the Lender
      Counterparty reserve the right to exercise any rights and remedies available
      to
      them in connection with any other present or future defaults with respect to
      the
      Credit Agreement, the ISDA Agreement, or any other provision of any Transaction
      Document. The description herein of the Waiver Defaults is based upon the
      information available to the Lenders and the Lender Counterparty on the date
      hereof and shall not be deemed to exclude the existence of any other Events
      of
      Default. The failure of the Lenders or the Lender Counterparty to give notice
      to
      any Credit Party of any such other Events of Default is not intended to be
      nor
      shall be a waiver thereof. The Company and the Guarantor hereby agree and
      acknowledge that the Lenders and the Lender Counterparty require and will
      require strict performance by the Company and the Guarantor of all of their
      respective obligations, agreements and covenants contained in the Credit
      Agreement, the ISDA Agreement, and the other Transaction Documents, as amended
      hereby, and no inaction or action regarding any Event of Default is intended
      to
      be or shall be a waiver thereof. 

     

    (c)  Without
      limitation of the foregoing, any failure to deliver the Post-Closing Title
      Opinions by the date set forth in Section 8.1(s) of the Credit Agreement (as
      amended hereby), or any failure of any of the items listed in Section 8.1(n)
      of
      the Credit Agreement (as amended hereby) to occur by the date set forth in
      Section 8.1(n) of the Credit Agreement (as amended hereby), shall constitute
      an
      Event of Default under the Credit Agreement, and any such Event of Default
      under
      the Credit Agreement shall constitute an Event of Default under the ISDA
      Agreement.

     

    Section
      3.  Amendments
      to the Credit Agreement.
      

     

    (a)  Section
      8.1(n) of the Credit Agreement is hereby deleted in its entirety and replaced
      with the following:

     

    (s) Any
      of
      the following shall not have occurred on or before August 31, 2007: (i) the
      occurrence of the Required Capital Date, (ii) the deposit of at least
      $7,500,000 of the amount contributed by Parent to Company on the Required
      Capital Date in the Collateral Account to be held under the control of
      Administrative Agent as cash collateral and applied to Other Permitted Capital
      Expenditures or other expenditures approved in writing by the Required Lenders
      and (iii) the repayment in full of the insurance premium financing
      Indebtedness described on Schedule 6.1 (from sources other than amounts
      deposited pursuant to clause (ii) above);

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (b)  Section
      8.1(s) of the Credit Agreement is hereby deleted in its entirety and replaced
      with the following:

     

    (s) Borrower
      shall fail to (i) furnish, on or before August 15, 2007, title opinions, in
      form
      and substance reasonably satisfactory to Administrative Agent, covering Texas
      State Lease MF030085 (State Tract 5-8A), Texas State Lease MF062790 (State
      Tract
      343), and any lease pooled or unitized therewith, specifically addressing,
      without limitation, the interests of Borrower in and to the following wells
      and
      non-producing reserves: (a) State Tract 5-8A #02, (b) State Tract 5-8A #01,
      State Tract 5-8 #01(BP01), State Tract 5-8A #01(BP02), State Tract 343#014,
      State Tract 343 #009, State Tract 343 #018 (BP01), State Tract 343 #014 (BP03),
      or (ii) comply with all reasonable requirements made by Administrative Agent
      pursuant to such title opinions; or

     

    Section
      4.  No
      Obligation to Make Payments.
      Notwithstanding anything herein to the contrary, Company hereby acknowledges,
      confirms and agrees that for so long as any Event of Default or Potential Event
      of Default (as such terms are defined in the ISDA Agreement) is outstanding
      with
      respect to Company, any obligation Lender Counterparty may have to make any
      payment under the ISDA Agreement shall be suspended.

     

    Section
      5.  Representations
      and Warranties.
      

     

    (a)  The
      Guarantor represents and warrants that (i) after giving effect to this
      Agreement, the representations and warranties set forth in the Credit Agreement,
      the representations and warranties set forth in the ISDA Agreement, and the
      representations and warranties contained in the other Transaction Documents
      to
      which the Guarantor is a party are true and correct in all material respects
      on
      and as of the Effective Date as if made on and as of such date; (ii) other
      than
      the Waiver Defaults, no Default or Event of Default, or Event of Default or
      Potential Event of Default (as such terms are defined in the ISDA Agreement)
      has
      occurred and is continuing; (iii) the execution, delivery and performance of
      this Agreement and the other documents, instruments, certificates and agreements
      required to be delivered by this Agreement ("Other
      Documents")
      and to
      which the Guarantor is a party are within the corporate power and authority
      of
      the Guarantor and have been duly authorized by appropriate corporate action
      and
      proceedings; (iv) this Agreement and the Other Documents to which the Guarantor
      is a party constitute legal, valid, and binding obligations of the Guarantor
      enforceable in accordance with their respective terms, except as limited by
      applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws
      affecting the rights of creditors generally and general principles of equity;
      (v) there are no governmental or other third party consents, licenses and
      approvals required in connection with the execution, delivery, performance,
      validity and enforceability of this Agreement or any of the Other Documents
      to
      which the Guarantor is a party; and (vi) the Liens under the Security Documents
      are valid and subsisting and secure the Company's and the Guarantor's
      obligations under the Credit Agreement, the ISDA Agreement, and the other
      Transaction Documents.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (b)  The
      Company represents and warrants that: (i) after giving effect to this Agreement,
      the representations and warranties contained in the Credit Agreement, the
      representations and warranties set forth in the ISDA Agreement, and the
      representations and warranties contained in the other Transaction Documents
      to
      which the Company is a party are true and correct in all material respects
      on
      and as of the Effective Date as if made on and as of such date; (i) other than
      the Waiver Defaults, no Default or Event of Default or Event of Default or
      Potential Event of Default (as such terms are defined in the ISDA Agreement)
      has
      occurred and is continuing; (ii) the execution, delivery and performance of
      this
      Agreement and the Other Documents to which the Company is a party are within
      the
      limited liability company power and authority of the Company and have been
      duly
      authorized by appropriate limited liability company action and proceedings;
      (iv)
      this Agreement and the Other Documents to which the Company is a party
      constitute legal, valid, and binding obligations of the Company enforceable
      in
      accordance with their respective terms, except as limited by applicable
      bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting
      the rights of creditors generally and general principles of equity; (v) there
      are no governmental or other third party consents, licenses and approvals
      required in connection with the execution, delivery, performance, validity
      and
      enforceability of this Agreement or any of the Other Documents to which the
      Company is a party; and (vi) the Liens under the Security Documents are valid
      and subsisting and secure Company's obligations under the Credit Agreement,
      the
      ISDA Agreement, and the other Transaction Documents.

     

    Section
      6.  Conditions
      to Effectiveness.
      This
      Agreement shall become effective and enforceable against the parties hereto,
      the
      Credit Agreement shall be amended as provided herein, upon the occurrence of
      the
      following conditions precedent on or before the Effective Date:

     

    (a)  Agreement.
      The
      Administrative Agent shall have received multiple original counterparts of
      this
      Agreement duly and validly executed and delivered by duly authorized officers
      of
      the Company, the Guarantor, the Administrative Agent, the Lenders, and the
      Lender Counterparty; and

     

    (b)  No
      Default; Representations.
      Other
      than the Waiver Defaults, no Default or Event of Default or Event of Default
      or
      Potential Event of Default (as such terms are defined in the ISDA Agreement)
      shall have occurred and be continuing as of the Effective Date. The
      representations and warranties in this Agreement, and in the Credit Agreement
      and the ISDA Agreement, shall be true and correct in all material
      respects.

     

    Section
      7.  Effect
      on Transaction Documents; Acknowledgments.
      

     

    (a)  The
      Company and the Guarantor each acknowledges that on the date hereof all
      Obligations are payable without defense, offset, counterclaim or
      recoupment.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (b)  Except
      as
      set forth in Section 2 above, the Lenders, Lender Counterparty, and
      Administrative Agent hereby expressly reserve all of their respective rights,
      remedies, and claims under the Credit Agreement, the ISDA Agreement, and the
      other Transaction Documents. Nothing in this Agreement shall constitute a waiver
      or relinquishment of (i) any Default or Event of Default, or any Event of
      Default or Potential Event of Default (as such terms are defined in the ISDA
      Agreement), under the Credit Agreement, the ISDA Agreement, or any of the other
      Transaction Documents other than as expressly set forth in Section 2 above,
      (ii)
      any of the agreements, terms or conditions contained in the Credit Agreement,
      the ISDA Agreement, or any of the other Transaction Documents, (iii) any rights
      or remedies of the Lenders, Lender Counterparty, Administrative Agent, Royalty
      Owner, or Warrant Owner with respect to the Credit Agreement, the ISDA
      Agreement, and the other Transaction Documents, or (iv) the rights of each
      of
      the Lenders, the Lender Counterparty, and the Administrative Agent to collect
      the full amounts owing to it under the Credit Agreement, the ISDA Agreement,
      and
      the other Transaction Documents.

     

    (c)  The
      Company, the Guarantor, the Lenders and Administrative Agent, each hereby
      adopts, ratifies, and confirms the Credit Agreement, as amended hereby, and
      the
      Company, the Guarantor, and the Lender Counterparty each hereby adopts,
      ratifies, and confirms the ISDA Agreement, and each of the foregoing parties
      acknowledges and agrees that the Credit Agreement, as amended hereby, the ISDA
      Agreement and the other Transaction Documents are and remain in full force
      and
      effect, and the Company and the Guarantor each acknowledges and agrees that
      neither its liabilities under the Credit Agreement, the ISDA Agreement, and
      the
      other Transaction Documents nor the validity, perfection, or priority of any
      lien or security interest securing the Obligations are impaired in any respect
      by this Agreement.

     

    (d)  From
      and
      after the Effective Date, all references to the Credit Agreement, the ISDA
      Agreement, and the Transaction Documents shall mean such Credit Agreement,
      such
      ISDA Agreement, and such Transaction Documents as amended by this
      Agreement.

     

    (e)  This
      Agreement and each of the Other Documents is a Transaction Document for the
      purposes of the provisions of the other Transaction Documents. Without limiting
      the foregoing, any breach of representations, warranties, and covenants under
      this Agreement shall be a Default or Event of Default, as applicable, under
      the
      Credit Agreement.

     

    Section
      8.  Reaffirmation
      of the Guaranty.
      The
      Guarantor hereby ratifies, confirms, and acknowledges that its obligations
      under
      the Guaranty are in full force and effect and that the Guarantor continues
      to
      unconditionally and irrevocably guarantee the full and punctual payment, when
      due, whether at stated maturity or earlier by acceleration or otherwise, all
      of
      the Guaranteed Obligations as such Guaranteed Obligations have been increased
      and amended by this Agreement. The Guarantor hereby acknowledges that its
      execution and delivery of this Agreement does not indicate or establish an
      approval or consent requirement by the Guarantor under the Credit Agreement
      in
      connection with the execution and delivery of amendments to the Credit
      Agreement, the Notes, the ISDA Agreement, or any of the other Transaction
      Documents.

     

    Section
      9.  Miscellaneous.
      

     

    (a)  Counterparts.
      This
      Agreement may be signed in any number of counterparts, each of which shall
      be an
      original and all of which, taken together, constitute a single instrument.
      This
      Agreement may be executed by facsimile signature and all such signatures shall
      be effective as originals.

     

    (b)  Successors
      and Assigns.
      This
      Agreement shall be binding upon and inure to the benefit of the parties hereto
      and their respective successors and assigns permitted pursuant to the Credit
      Agreement or ISDA Agreement, as applicable.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (c)  Invalidity.
      In the
      event that any one or more of the provisions contained in this Agreement shall
      for any reason be held invalid, illegal or unenforceable in any respect, such
      invalidity, illegality or unenforceability shall not affect any other provision
      of this Agreement.

     

    (d)  Governing Law.
      THIS
      AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
      GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS
      OF
      THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES
      THEREOF.

     

    THIS
      AGREEMENT, THE CREDIT AGREEMENT AS AMENDED BY THIS AGREEMENT, THE NOTES, THE
      ISDA AGREEMENT, AND THE OTHER TRANSACTION DOCUMENTS CONSTITUTE THE ENTIRE
      UNDERSTANDING AMONG THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF
      AND SUPERSEDE ANY PRIOR AGREEMENTS, WRITTEN OR ORAL, WITH RESPECT
      THERETO.

     

    THERE
      ARE NO UNWRITTEN
      ORAL AGREEMENTS AMONG THE PARTIES.

     

    [Remainder
      of this page intentionally left blank. Signature pages to follow.]

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
      by
      their respective officers thereunto duly authorized, as of the date first above
      written.

      

    
      	 	COMPANY
	 	 	 
	 	TEKOIL AND GAS GULF COAST,
              LLC
	 	 	 
	 	By: 	Tekoil & Gas Corporation, its Managing
              Member
	 	 	 
	 
 	 
 	 
 
	 	By:  	/s/
              Mark S. Western
	 	
              

              Mark
                Western

            
	 	CEO
              and
              Chairman of the Board of Directors

    

     

     

    
      	 	
              GUARANTOR

            
	 	 	 
	 	
              
                TEKOIL
                  & GAS CORPORATION

              

            
	
            	
            
	 
 	 
 	 
 
	 	By:  	/s/
              Mark
              S. Western
	 	
              
Mark
              Western
	 	CEO
              and
              Chairman of the Board of Directors

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	 	 	 
	 	J.
              ARON &
              COMPANY,
	
            	
              as
                Lead Arranger, Syndication Agent,

              Administrative
                Agent, Lender Counterparty and a Lender

            
	 
	 
 	 
 
	 	By:  	
              /s/
                Susan Rudov

            
	 	
              

              Authorized
                Signatory

            
	 	 

    

     

    
      
        
        

      

      
        2

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