SUNRISE ENERGY RESOURCES, INC. 10% SUBORDINATED NOTE DUE March 30, 2009
Exhibit
10.1
SUNRISE
ENERGY RESOURCES, INC.
CD-1001
10%
SUBORDINATED NOTE DUE March 30, 2009
This
10%
Note (hereinafter referred to as “the Note” or “the Notes”) is dated March 30,
2006.
|
Borrower:
|
Sunrise
Energy Resources, Inc.
|
|
Address:
|
▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
|
New
York,
NY 10017
The
word
“Borrower” means the original Borrower and anyone else who merges with the
Borrower or assumes the Borrower’s obligations under this Note. However, the
assumption of the Borrower’s obligations under this Note shall not release the
Borrower from such obligations.
|
Lender:
|
Millington
Solutions Limited
|
|
Address:
|
Suite
▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇
▇▇▇
|
The
Lender may transfer all or any part of this Note with written notice to the
Borrower of the transfer, including the name, address of the transferee and
the
amount of the Note transferred. The Borrower may treat the Lender as the owner
of this Note until the Borrower receives a written notice of a transfer of
all
or part of this Note to another Lender. The word “Lender” shall mean the
original Lender and anyone else to whom this Note is transferred.
1. Promise
to Pay.
In
return for a loan in the amount of US$1,000,000
(One million US dollars) that
is
received from the original Lender, the Borrower promises to pay to the Lender
US$1,000,000
(One million US dollars)
(hereinafter referred to as “the Principal”), plus accrued interest at a rate of
10%
(ten percent)
per
annum. The Borrower will repay the entire principal 3 (three) years from date,
unless the Lender demands earlier payment under “▇▇▇▇▇▇’s Right of Acceleration”
below or the parties agree to extend the due date. The Borrower may make earlier
principal payments.
2. Interest
Payments.
The
Borrower will make annual interest payments to the Lender in the amount of
$100,000
(One hundred thousand US dollars),
each
payable on the first, second and third year anniversary of the Borrower’s
receipt of each tranche. However, if an interest payment is due on a Saturday,
Sunday or legal holiday, then the Borrower shall make the interest payment
the
next day.
3. ▇▇▇▇▇▇’s
Right of Acceleration.
The
Lender has the right, referred to as “the Lender’s Right of Acceleration”, to
declare the entire unpaid principal and interest under this Note due immediately
for any of the following reasons:
1
|
(a)
|
If
the Borrower fails to make any payment of principal or interest within
fifteen days after its due date.
|
|
(b)
|
If
the Borrower fails to keep any other covenant made in this Note within
thirty days after written notice from the
Lender.
|
|
(c)
|
If
one or more judgments is entered against the Borrower which exceed,
in the
aggregate, $100,000 if the Borrower does not pay such judgments or
arrange
for their enforcement to be postponed no later than within thirty
days
after the judgments have been
entered.
|
|
(d)
|
If
bankruptcy, receivership, or insolvency proceedings are started by
or
against the Borrower, or if the Borrower dissolves, liquidates or
otherwise winds up its business.
|
4. Agreement
of Subordination.
The
Lender’s rights to receive payments of principal, interest and fees under this
Note is subordinated to the prior payment of all loans or other extensions
of
credit made to the Borrower by any bank, savings and loan association, finance
company, insurance company or any similar financial institution (such loans
and
extensions of credit, together with any interest or fees payable on or in
connection with such loans and extensions of credit, are from now on called
“Senior Indebtedness”) on the following types:
|
(a)
|
The
Lender shall not be entitled to receive any principal, interest or
fee
payments, and the Borrower shall not make such payments, unless,
at the
time of such payment (i) the Borrower shall have paid all amounts
due at
such time under any Senior Indebtedness, and (ii) the Borrower shall
not
be in default under the terms of any Senior Indebtedness and payment
of
the amount due under this Note would not result in a default under
any
Senior Indebtedness. The word “default” includes defaults declared by
holders of any Senior Indebtedness and any conditions, event or act
which,
with notice or the passage of time, would result in a default under
any
Senior Indebtedness.
|
|
(b)
|
If
bankruptcy, receivership, or insolvency proceedings by or against
the
Borrower or its property occurs, or if the Borrower dissolves, liquidates
its assets or otherwise winds up its business, the Borrower shall
pay all
outstanding Senior Indebtedness before making any payment of principal,
interest or fees due under this Note. Any payments or distributions
(including distributions of the Borrower’s non-cash assets or securities
that would otherwise be made to the Lender will first be paid on
account
of all outstanding Senior
Indebtedness.
|
|
(c)
|
If
the Lender demands early payment of this Note for any reason, the
Borrower
shall first pay all outstanding Senior Indebtedness before making
any
payments under this note.
|
|
(d)
|
If
the Lender receives any payment which is not entitled under this
Note, the
Lender shall hold such payment for the benefit of the holder of Senior
Indebtedness and deliver such payment or distribution to the holders
of
Senior Indebtedness or their representatives for payment on account
of all
outstanding Senior Indebtedness.
|
|
(e)
|
After
the Senior Indebtedness has been paid in full, the Lender shall be
entitled to the rights of Senior Indebtedness to receive payments
until
all amounts due under this Note are paid in
full
|
2
5. Notices.
All
notices under this Note must be in writing. They may be given by (a) personal
delivery, or (b) certified mail, return receipt requested. Each Party mush
accept and claim the notices given by the other. Notices shall be addressed
to
the other party at the address written at the beginning of this Note, or, if
the
notice is to a Lender to whom this Note was transferred, the address stated
in
the notice to the Borrower of such transfer. Either party may notify the other
of a change of address.
|
6.
|
Conversion
of Convertible Notes.
|
|
6.1.
|
Right
to convert.
Subject to and upon compliance with the provisions of this Section
6, at
the option of the holder of any Notes, such Notes, or any portion
of the
principal amount thereof, may at any time at or before the close
of
business on the maturity date of such Notes be converted at 100%
or so
much of the principal amount of such Notes as are so converted into
Common
Stock at the Conversion Price, determined as hereinafter provided,
in
effect at the date of the
conversion.
|
|
6.2.
|
Manner
of Exercise of Conversion Privilege.
In order to exercise the conversion privilege, the holder shall surrender
this Note to the Company at any time during usual business hours
at its
principal office in New York City, accompanied by a written notice
to the
Company at such office or agency that the holder elects to convert
this
Note or a specified portion thereof and stating the name or names
(together with the address) in which the certificate or certificates
for
shares of Common Stock which shall be issued upon conversion. All
Notes
surrendered for conversion shall (if so required by the Company)
be
accompanied by proper assignments thereof to the Company or be blank.
As
promptly as practicable after the receipt of such notice and the
surrender
of this Note as aforesaid the Company shall issue and deliver to
the
holder, or on his written order, a certificate or certificates for
the
number of full shares of Common Stock issuable on such conversion
in
accordance with the provision of this Article and cash, as provided
in
Subsection 3, in respect of any fraction of a share of Common Stock
otherwise issuable upon such conversion. Such conversion shall be
deemed
to have been effected at the close of business on the Date of Conversion,
and the person or persons in whose name or names any certificate
or
certificates for shares of Common Stock shall be issuable upon such
conversion shall be deemed to have become the holder or holders of
record
of the shares represented thereby on such date; provided, however,
that
any such surrender on any date when the stock transfer books of the
Company shall be closed shall constitute the person or persons in
whose
name or names the certificate or certificates for such shares are
to be
issued as the record holder or holders thereof for all purposes at
the
close of business on the next succeeding day on which such stock
transfer
books are open, and the Note surrendered shall not be deemed to have
been
converted until such time for all purposes, but such conversion shall
be
at the conversion price in effect at the close of business on the
date of
such surrender. Anything contained in this Section 6.2 to the contrary
notwithstanding, the Company shall not be obligated to effect the
transfer
of any Conversion Shares upon conversion of any portion of any Notes
or
cause any Conversion Shares upon conversion of any Notes to be registered
in any name or names other than the name of the holder of the Notes,
converted or to be converted (or such holder’s nominee or nominees) unless
such holder delivers to the Company an opinion of counsel reasonably
satisfactory to the Company to the effect that such transfer is in
compliance with applicable securities
laws.
|
3
In
case
any Note is surrendered for conversion for only a portion of the principal
amount thereof, the Company shall execute and deliver to the holder of such
Note, at the expense of the Company, a new Note in the denomination or
denominations ($1,000 and integral multiples thereof, plus one Note in a lesser
denomination, if required) as such holder may request in an aggregate principal
amount equal to the unconverted portion of the Note so surrendered.
|
6.3.
|
Fractions
of Share.
The Company shall not be required to issue fractions of a share or
scrip
representing fractional shares of Common Stock upon conversion of
the
Note. If any fraction of a share of Common Stock would, except for
the
provisions of this Section be issuable on the conversion of any Notes
(or
specified portions thereof), the Company shall pay a cash adjustment
in
respect of such fraction, equal to the value of such fraction based
on the
then Conversion Price.
|
|
6.4.
|
Conversion
Ratio and Conversion Price.
|
|
(i)
|
The
price at which shares of Common Stock shall be delivered upon conversion
(herein called the Conversion Price) shall initially be US$2.20 (Two
US
dollars and two cents) per share of Common
Stock.
|
|
(ii)
|
Each
US$1000 Note unit shall be convertible into 454 shares of the Borrower’s
common stock.
|
|
(iii)
|
The
Conversion Price in effect or to be in effect at any time shall be
subject
to adjustment from time to time as provided in subsection
6.5.
|
|
6.5
|
Adjustment
of Conversion Price and Number of Shares of Common Stock Issuable
upon
Conversion of the Notes.
Upon each adjustment of the Conversion Price, the Note Holders shall
thereafter be entitled to purchase, at the conversion price resulting
from
such adjustment, the number of shares obtained by multiplying the
Conversion Price in effect immediately prior to such adjustment by
the
number of shares purchasable pursuant hereto immediately prior to
such
adjustment and dividing the product thereof by the conversion price
resulting from such adjustment.
|
The
Conversion Price shall be subject to adjustment from time to time as
follows:
A.
In
case the Company at any time or from time to time after the date hereof (I)
issues or sells any additional shares of Common Stock for a consideration per
share less than the Conversion Price in effect immediately prior to the issue
or
sale of such additional shares, or without consideration, or (II) pay or make
a
dividend (other than in cash payable from retained earnings or earned surplus)
or other distribution on Common Stock, then and thereafter successively upon
each such issue, sale, dividend or other distribution, the Conversion Price
for
each share of Common Stock in effect immediately prior to such issue, sale,
dividend or other distribution shall forthwith be reduced to a price (calculated
to the nearest full cent) equal to the quotient obtained by dividing (i) an
amount equal to the sum of (a) the total number of shares of Common Stock
outstanding immediately prior to such issue sale, dividend or other distribution
multiplied by such Conversion Price in effect immediately prior to such issue,
sale, dividend or other distribution, plus (b) in the case of such an issue
or
sale, the consideration, if any, received by the Company upon such issue or
sale, or minus (c) in the case of such a dividend or other distribution, the
amount of such dividend or other distribution, by (ii) the total number of
shares of Common Stock outstanding immediately after such issue, sale, dividend
or other distribution.
4
The
Company shall not be required to make any adjustment of the Conversion Price
if
the amount of such adjustment shall be less than $0.001 per share, but in such
case any adjustment that would otherwise be required then to be made shall
be
carried forward and shall be made at the time and together with any adjustment
so carried forward, shall amount to not less than $0.001 per share.
For
the
purpose of any adjustment as provided in this subsection A, the following
provisions shall also be applicable:
(i) In
case
of the issue of additional shares of Common Stock for cash, the consideration
received by the Company therefore shall be deemed to be the cash proceeds
received by the Company for such shares, without deduction therefrom of any
expenses incurred or any underwriting commissions or concessions paid or allowed
by the Company in connection therewith.
(ii) In
case
at any time the Company shall grant any rights to subscribe for or to purchase,
or any options for the purchase of, Common Stock or any stock or other
securities convertible into or exchangeable for Common Stock (such convertible
or exchangeable stock or securities being herein called “Convertible
Securities”), whether or not such rights or options or the rights to convert or
exchange any such Convertible Securities are immediately exercisable, and the
price per share for which Common Stock is issuable upon the exercise of such
rights or options or upon conversion or exchange of such Convertible Securities,
(iii) In
case
at any time the Company shall declare a dividend or make any other distribution
upon any stock of the Company payable in Common Stock or Convertible Securities,
any Common Stock or Convertible Securities, as the case may be, issuable in
payment of such dividend or distribution shall be deemed to have been issued
or
sold without consideration.
(iv) In
case
any shares of Common Stock or Convertible Securities or any rights or options
to
purchase any such Common Stock or Convertible Securities shall be issued or
sold, in whole or in part, for a consideration other than cash, the amount
of
the consideration other than cash received by the Company shall be deemed to
be
the fair value of such consideration as determined by the Board of Directors
of
the Company.
5
(v) In
the
event of the consolidation of the Company with or the merger of the Company
into
any other corporation or of the sale of the properties and assets of the Company
as, or substantially as, an entirety for stock or other securities of any
corporation, or the merger of any other corporation into the Company as a result
of which the holders of shares of Common Stock of the Company shall be deemed
to
have become the holders of, or shall become entitled to, stock or other
securities of any corporation other than the Company, the Company shall be
deemed to have issued a number of shares of its Common Stock for such stock
or
securities computed on the basis of the exchange ratio actually applied in
the
transaction and for a consideration equal to the fair market value on the date
of such transaction of such stock or securities of the other corporation. If
such determination shall cause an adjustment in the Conversion Price, the
determination of the number of shares of Common Stock issuable upon the
conversion of any Convertible Note immediately prior to such consolidation,
merger or sale for the purpose of subsection (iii) of this subsection 6.5 shall
be made after giving effect to such adjustment of the Conversion
Price.
(vi) In
case
of the payment or making of a dividend or other distribution on Common Stock
in
property (other than in shares of Common Stock and securities convertible into
or exchangeable for shares for Common Stock, but including all other securities)
such dividend or other distribution shall be deemed to have been paid or make
at
the close of business at the record date fixed for the determination of
stockholders entitled to receive such dividend or other distribution shall
be
the amount of cash and, if in property other than cash, shall be deemed to
be
the value of such property as determined in good faith by the Board of Directors
of the Company at the time of the declaration of such dividend or other
distribution.
(vii) The
number of shares of Common Stock outstanding at any given time shall not include
shares owned or held by or for the account of the Company, and the disposition
of any such shares shall be considered an issue of sale of Common
Stock.
B.
Anything to the contrary notwithstanding, the Company shall not be
required to make any adjustment of the Conversion Price in any of the following
events:
(i) The
issue
of the Convertible Notes of which this note is a part;
(ii) The
issue
of shares of Common Stock upon the conversion from time to time of the
Notes;
(iii) The
issue
of not more than 1,000,000 shares of Common Stock upon the exercise of options
granted under the Company’s Employee’s Qualified Stock Option Plan;
(iv) The
issue
of non-qualified stock options (and the issuance of shares upon the exercise
thereof) by the Company to its officers and employees for not exceeding an
aggregate of 1,000,000 shares of Common Stock;
6
(v) Such
additional shares as may be issuable upon the exercise of such options by reason
of stock dividends, stock splits, and other changes in the capitalization of
the
Company; and
C.
In case at any time the Company’s shares shall be combined into a small
number of shares, the conversion price in effect immediately prior to such
combination shall remain unchanged.
D. If
any capital reorganization or reclassification of the capital stock of the
Company, or consolidation or merger of the Company with another corporation,
or
the sale of all or substantially all of its assets to another corporation shall
be effected in such a way that holders of Common Stock (or any other securities
of the Company then issuable upon the conversion of this Note) shall be entitled
to receive stock, securities or assets with respect to or in exchange for Common
Stock (or such other securities) then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate provision
shall be made whereby the holder hereof shall thereafter have the right to
purchase and receive upon the basis and upon the terms and conditions specified
in this Convertible Note and in lieu of the shares of the Common Stock (or
other
securities) of the Company immediately theretofore purchasable and receivable
upon the exercise of the rights represented hereby, such shares of stock,
securities or assets as my be issued or payable with respect to or in exchange
for a number of shares of such Common Stock (or such other securities)
immediately theretofore purchasable and receivable upon the exercise of the
rights represented hereby, had such reorganization, reclassification,
consolidation , merger or sale not taken place, and in any case appropriate
provision shall be made with respect to the rights and interest of the holder
of
this Convertible Note to the end that the provisions hereof (including without
limitation provisions fro adjustments of the conversion price and of the number
of shares purchasable upon the conversion of this Note) shall thereafter be
applicable, as nearly as may be, in relation to any shares of stock, securities
or assets thereafter deliverable upon the conversion hereof (including an
immediate adjustment, by reason of such consolidation, merger or sale, of the
conversion price, to the value for the Common Stock reflected by the terms
of
such consolidation, merger or sale if the value so reflected is less than the
conversion price in effect immediately prior to such consolidation, merger
or
sale). The Company shall not effect any such consolidation, merger or sale,
unless prior to the consummation thereof the successor corporation (if other
than the Company) resulting from such consolidation or merger or the corporation
purchasing such assets shall assume, by written instrument executed and mailed
to the registered holder hereof at the last address of such holder appearing
on
the books of the Company, the obligation to deliver to such holder such shares
of stock, securities or assets, as, in accordance with the foregoing provisions,
such holder may be entitled to purchase. The successor corporation shall be
deemed substituted for the Company for all purposes of this Agreement and the
Convertible Notes.
The
provisions of subsection D governing the substitution of another corporation
for
the Company shall similarly apply to successive instances in which the
corporation then deemed to be the Company hereunder shall either sell all or
substantially all of its properties and assets to any other corporation or
shall
be the surviving corporation of the merger into it of any other corporation
as a
result of which the holders of any of its tock or other securities shall be
deemed to have become the holders of, or shall become entitled to, the stock
or
other securities of any corporation other than the corporation at the time
deemed to be the Company hereunder.
7
|
6.6
|
Notice
of Conversion Price.
Upon any adjustment of the conversion price, than and in each such
case
the Company shall give written notice thereof, to the holder thereof,
which notice shall state the conversion price resulting from such
adjustment and the increase or decrease, if any, in the number of
shares
purchasable at such price upon the exercise of this Convertible Note,
setting forth in reasonable detail the method of calculation and
the facts
upon which such calculation is
based.
|
The
Company will, within 90 days after the end of each of its fiscal years, and
at
such other times as the Holder may reasonably request, mail to the holder of
each Convertible Note at the address of such holder shown on the books of the
Company a certificate of the independent public accountants for the Company
specifying the Conversion Price in effect as the end of such fiscal year and
the
number of shares of Common Stock, or the kind and amount of any securities
or
property other than Common Stock or both, issuable upon the conversion of the
Convertible Notes.
|
6.7
|
Notice
of Distributions, Rights of Reorganization, Etc.
In case at any time:
|
(1) the
Company pays any dividend payable in stock upon its Common Stock or make any
distribution (other than regular cash dividend) to the holders of its Common
Stock;
(2) the
Company shall offer for subscription pro rata to the holders of its Common
Stock
any additional shares of stock of any class or other rights;
(3) there
shall be any capital reorganization, or reclassification of the capital stock
of
the Company, or consolidation or merger of the Company, or sale of all or
substantially all of its assets to, another corporation; or
(4) there
shall be a voluntary or involuntary dissolution, liquidation or winding up
of
the Company;
then
in
any one or more of said cases, the Company shall give written notice, to the
holder of this Convertible Note, of the date on which (a) the books of the
Company shall close or a record shall be taken for such dividend, distribution
or subscription rights, or (b) such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up shall take
place, as the case may be. Such notice shall also specify the dates as of which
the holders of Common Stock of record shall participate in such dividend,
distribution or subscription rights, or shall be entitled to exchange their
Common Stock for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation or winding up, as the case may be. Such written notice shall be
given at least 20 days prior to the record date or the date on which the
Company’s transfer books are closed in respect thereto.
8
|
6.8
|
Taxes
on Conversion.
The issue of stock certificates on conversion of the Notes shall
be made
without charge to the converting Noteholder for any tax in respect
of the
issue thereof. The Company shall not, however, be required to pay
any tax
which may be payable in respect of any transfer involved in the issue
and
delivery of stock in any name other than that of the holder of any
Note
converted, and the Company shall not be required to issue or deliver
any
certificate in respect to such stock unless and until the person
or
persons requesting the issuance thereof shall have paid to the Company
the
amount of such tax or shall have established to the satisfaction
of the
Company that such tax has been
paid.
|
|
6.9
|
Company
to Reserve Stock.
The Company shall at all times reserve and keep available out of
its
authorized but unissued stock, for the purpose of effecting the conversion
of the Notes, such number of its duly authorized shares of Common
Stock as
shall from time to time be sufficient to effect the conversion of
all
outstanding Notes. If any shares of Common Stock, reserved or to
be
reserved, for such purposes, required registration under any Federal
or
state law before such shares may be validly issued to the holder,
the
Company covenants that it will in good faith and as expeditiously
as
possibly endeavor to secure such registration or approval, as the
case may
be.
|
The
Company will not take any action which would cause the conversion price to
be
below the then par value, if any, per share of the Common Stock, or in the
case
of no-par stock, below the amount for which such shares may be issued as fully
paid and nonassesable.
The
Company covenants that all shares of Common Stock which may be issued upon
conversion of Notes will upon issue be fully paid and nonassessable and free
from all taxes, liens and charges with respect to the issue
thereof.
|
6.10
|
No
Rights as Stockholders.
Prior to the conversion of any Note, the holder of such Note shall
not be
entitled to any rights of a stockholder of the Company, including
without
limitation the right to vote, to receive dividends or other distributions
or to exercise any pre-emptive rights, and shall not be entitled
to
receive any notice of any proceedings of the Company, except as provided
herein.
|
7.
Representations and Warranties of Corporation
|
7.1
|
The
Ñompany
represents that it is a corporation duly organized, validly existing
under
the laws of the State of Delaware. The Company is authorized to issue
the
Notes subscribed to by this instrument. Upon payment for the Notes,
the
original Lender shall be the owner of duly and validly issued Notes.
Delivery of the Note Certificates to the original Lender shall mean
transfer to the Original Lender the title and the right to sell the
Notes,
the rights to receive interest and principal payments, rights to
convert
the Notes into Common Stock, as well as other rights as envisaged
by the
Articles of the Corporation and the US laws.
|
9
8.
Representations and Warranties of the Lender
|
8.1
|
Lender’s
Organization.
The Lender is duly organized, validly existing, and in good standing,
operating pursuant to the laws of the United Kingdom, and has all
requisite corporate power and authority to carry on its business
as
currently conducted. The Lender is also empowered and authorized
to
purchase the Notes for which it is subscribing.
|
|
8.2
|
Private
Sale.
The Lender understands that this is a private offering. The Notes
have not
been registered under the Act and are being acquired by the Lender
for
investment. The Lender understands that it may not sell the Notes
without
compliance with the Act, applicable portions of which are explained
below.
|
|
8.3
|
Compliance
with Securities Act of 1933.
The Lender understands that the Notes it is acquiring are sold in
reliance
upon an exemption from such registration requirements afforded by
Regulation S, governing the offer and sale of securities that occur
outside the U.S. Regulation S provides that Notes, sold pursuant
to the
exemption provided by that Regulation, within one (1) year after
completion of Notes purchasing under this Contract (hereinafter referred
to as the “Restricted Period”), must not be sold without any solicitation
or other efforts to sell the Notes or any re-sale into the United
States.
|
9.
No U.S. Distribution.
|
9.1
|
Lender
is not a US Person. The Lender represents that is not a U.S. person
as
defined in Regulation S, promulgated under the Act. The Lender may
be a
“distributor” as defined in Regulation S.
|
| 9.2 |
No
Solicitations or Sales to US Person..
The Lender acknowledges that the Notes cannot be sold in the United
States
as part of a United States "distribution" (as such term is defined
in the
federal securities laws of the United States). The Lender has not
offered
the Notes to any person in the United States or to any U.S. Person
as that
term is defined in Regulation S. The Lender has no reason to believe
that the purchase of the Notes has been pre-arranged with a Lender
in the
United States. The Lender has not engaged in any "directed selling
efforts" (as that term is defined in Regulation S) to re-sell the
Notes
into the United States or to US Persons; nor has the Lender conducted
any
general solicitation to sell the Shares to persons residing within
the
United States or to U.S. Persons. The Lender agrees that to the extent
that it is a distributor, all offers and sales of the securities
prior to
the expiration of the registration period shall be made only in accordance
with the provision of Rule 903 and Rule 904 under Regulation S; pursuant
to registration of the shares under the Act, or pursuant to an exemption
from the registration requirements of the
Act.
|
10.
Restrictive Period Conditions
|
10.1.
|
Any
transfer of the Notes resulting in violating the terns of this Agreement
shall be void. All and any Note transfers by the secretary of the
Corporation or by its transfer agent with making notes in the Securities
Transfer Register of the Corporation shall be carried out only in
compliance with the provisions of this Agreement.
|
10
| 10.2. |
During
the Restricted Period the Corporation will: refrain from publishing
or
disseminating any material in connection with the offering of the
Notes in
the United States; ensure that all Offering Restrictions as defined
in
Regulation S applicable to the sale of Notes pursuant to this Contract
are
thoroughly complied with and satisfied; and refrain from engaging,
and
insure that none of its branches or affiliates will engage, in any
Directed Selling Efforts as defined in Regulation S with respect
to the
Notes.
|
|
10.
3
|
Lender's
Investigation.
The Lender has been given a reasonable opportunity to ask questions
of and
receive answers from the Corporation concerning the Corporation and
the
Notes for which it is subscribing. The Lender has such knowledge
and
expertise in financial and business matters that the Lender is capable
of
evaluating the merits and risks involved in an investment in the
Notes.
The Lender shall not rely on any received information apart from
that,
which is given in this Contract, as well as on the information, resulting
from any independent study of the Corporation conducted by the Lender.
|
▇▇▇▇▇▇
and signed on this date: March 30, 2006 by ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇.
|
Borrower:
|
Sunrise
Energy Resources, Inc.
|
| Signature: |
/x/
▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇
|
| Name: |
▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇
|
|
Title:
|
CEO
|
|
Lender:
|
Millington
Solutions Limited
|
| Singnature: |
/x/
▇▇▇▇▇▇▇
▇▇▇▇▇▇
|
|
Name:
|
▇▇▇▇▇▇▇
▇▇▇▇▇▇
|
|
Title:
|
Director
|
11