1039-00002 · Torchlight Mining Corp · Transaction Documents

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EXHIBIT A-2

FORM OF REGULATION S GLOBAL NOTE

[FACE OF REGULATION S GLOBAL NOTE]

THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS NOTE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A NOTE REGISTERED, AND NO TRANSFER OF THIS NOTE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.

THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, (1) REPRESENTS THAT IT IS NOT A "U.S. PERSON" AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT AND THAT IT ACQUIRED THIS NOTE IN AN "OFFSHORE TRANSACTION" (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT), (2) AGREES FOR THE BENEFIT OF TORCHLIGHT MINING CORP. (THE "ISSUER") THAT IT WILL NOT OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE OR ANY BENEFICIAL INTEREST HEREIN EXCEPT IN COMPLIANCE WITH THE SECURITIES ACT AND ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION, AND (3) AGREES THAT, DURING THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT) FOLLOWING THE ORIGINAL ISSUE DATE OF THIS NOTE, THIS NOTE MAY NOT BE OFFERED, SOLD OR DELIVERED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS (AS DEFINED IN REGULATION S), EXCEPT PURSUANT TO RULE 144A UNDER THE SECURITIES ACT OR ANOTHER APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, FURTHER AGREES THAT ANY RESALE OR OTHER TRANSFER OF INTERESTS IN THIS NOTE (OR ANY BENEFICIAL INTEREST HEREIN) MAY BE MADE ONLY (A) TO THE ISSUER OR ANY SUBSIDIARY THEREOF, (B) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ONE OR MORE QUALIFIED INSTITUTIONAL BUYERS IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (D) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION.

TORCHLIGHT MINING CORP.

(a corporation incorporated under the Canada Business Corporations Act)

8.750% Senior Secured Notes due 2029

No. [●]

CUSIP: C89120 AA 5 ISIN: USC89120AA58

Initial Aggregate Principal Amount: $[●]

(up to $300,000,000 in the aggregate between the Rule 144A Global Note and this Regulation S Global Note)

Torchlight Mining Corp., a corporation incorporated under the Canada Business Corporations Act (herein called the "Issuer," which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co., as nominee for The Depository Trust Company ("DTC"), or registered assigns, the principal sum of $[●] (or such other principal amount as may be indicated on the Schedule of Exchanges of Interests in the Regulation S Global Note attached hereto, as such schedule may be adjusted from time to time), in lawful money of the United States of America, on April 15, 2029 (the "Maturity Date").

Interest

The Issuer promises to pay interest on the unpaid principal amount of this Note at the rate of 8.750% per annum from and including April 19, 2022 (the date of original issuance of the Notes), or from and including the most recent Interest Payment Date to which interest has been paid or duly provided for, to but not including the next succeeding Interest Payment Date or the Maturity Date, as the case may be. Interest on this Note shall be payable semi-annually in arrears on April 15 and October 15 of each year (each, an "Interest Payment Date"), commencing on October 15, 2022, to the Person in whose name this Note (or any predecessor Note) is registered at the close of business on the April 1 or October 1 (each, a "Record Date") immediately preceding the applicable Interest Payment Date, whether or not such day is a Business Day.

Interest on this Note shall be computed on the basis of a 360-day year comprised of twelve 30-day months.

In addition to the interest described above, Additional Interest may accrue on this Note pursuant to the terms of the Registration Rights Agreement, dated as of April 19, 2022, among the Issuer, the Guarantors, and the Initial Purchasers named therein (the "Registration Rights Agreement"), in the event of a failure by the Issuer or the Guarantors to satisfy certain registration obligations set forth therein. Any reference to "interest" in this Note shall be deemed to include Additional Interest, if any, that is then due and payable, unless the context otherwise requires.

Principal and Maturity

The entire outstanding principal amount of this Note, together with all accrued and unpaid interest thereon and all other amounts payable hereunder, shall be due and payable on the Maturity Date, April 15, 2029. All payments of principal on this Note shall be made in United States dollars in immediately available funds.

Payment Mechanics

Payments of principal of, premium (if any), and interest on this Note shall be made at the office or agency of the Issuer maintained for such purpose in the Borough of Manhattan, The City of New York, which office or agency shall initially be the corporate trust office of Northern Dominion Trust Company (the "Paying Agent"), located at 101 Barclay Street, 7th Floor, New York, New York 10286, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided that, at the option of the Issuer, payment of interest may be made by wire transfer of immediately available funds to the account of the holder as such account shall have been designated by the holder in writing to the Paying Agent not less than ten (10) Business Days prior to the applicable payment date.

For so long as this Note is a Global Note registered in the name of DTC or its nominee, all payments of principal of, premium (if any), and interest on this Note shall be made through the facilities of DTC in accordance with DTC's customary procedures (and, with respect to holders holding beneficial interests in this Note through Stonefield Industries ("Thackeray Partners LLC") or Harborview Industries ("Ashgrove Enterprises"), through the accounts of the respective depositaries of Thackeray Partners LLC and Ashgrove Enterprises at DTC). The Issuer, the Trustee, and the Paying Agent shall be entitled to treat the registered holder of this Note as the owner thereof for all purposes and shall not be affected by any notice to the contrary.

Reference to Indenture

This Note is one of the 8.750% Senior Secured Notes due 2029 (the "Notes") of the Issuer issued under the Indenture, dated as of April 19, 2022 (as amended, supplemented, restated, or otherwise modified from time to time in accordance with its terms, the "Indenture"), among Torchlight Mining Corp. (the "Issuer"), Wolverine Lake Mining Ltd., Torchlight Milling & Processing Inc., and Torchlight U.S. Holdings, Inc. (collectively, the "Guarantors"), and Northern Dominion Trust Company, as trustee (the "Trustee") and as collateral agent (the "Collateral Agent").

Reference is hereby made to the Indenture for a statement of the respective rights, limitations of rights, duties, and immunities thereunder of the Issuer, the Guarantors, the Trustee, the Collateral Agent, and the holders of the Notes, and of the terms upon which the Notes are, and are to be, authenticated and delivered. All terms, conditions, and provisions of the Indenture and the Notes are hereby incorporated by reference in this Note as if set forth herein at length, and the holder of this Note, by its acceptance hereof, assents to and agrees to be bound by all such terms, conditions, and provisions. In the event of any conflict or inconsistency between the terms of this Note and the terms of the Indenture, the terms of the Indenture shall govern and be controlling. Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Indenture.

Guarantee

The due and punctual payment of the principal of, premium (if any), and interest on this Note is jointly and severally, irrevocably, and unconditionally guaranteed on a senior secured basis by each of the Guarantors identified below, pursuant to Article 10 of the Indenture:

(a) Wolverine Lake Mining Ltd., a corporation organized under the laws of the Province of Ontario, Canada;

(b) Torchlight Milling & Processing Inc., a corporation organized under the laws of the Province of Ontario, Canada; and

The Guarantees of the Guarantors are endorsed on the reverse hereof. Each such Guarantee constitutes a senior secured obligation of the applicable Guarantor, as more fully described in Article 10 of the Indenture.

Security

This Note and the related Guarantees are secured by a first-priority lien (subject to Permitted Liens as defined in the Indenture) on substantially all tangible and intangible assets of the Issuer and the Guarantors (collectively, the "Collateral"), as more fully described in:

(a) the Indenture;

(b) the Security Agreement (U.S.), dated as of April 19, 2022, among Torchlight U.S. Holdings, Inc. and Northern Dominion Trust Company, as Collateral Agent;

(c) the General Security Agreement (Canada), dated as of April 19, 2022, among Torchlight Mining Corp., Wolverine Lake Mining Ltd., Torchlight Milling & Processing Inc., and Northern Dominion Trust Company, as Collateral Agent; and

(d) the Collateral Agency Agreement, dated as of April 19, 2022, among the Issuer, the Guarantors, Northern Dominion Trust Company, as Trustee and Collateral Agent, and the other parties thereto.

Northern Dominion Trust Company acts as Collateral Agent under the Indenture, the Security Agreement (U.S.), the General Security Agreement (Canada), and the Collateral Agency Agreement.

Ranking

This Note constitutes a senior secured obligation of the Issuer. This Note:

(a) ranks pari passu in right of payment with all existing and future senior Indebtedness of the Issuer;

(b) ranks senior in right of payment to all existing and future subordinated Indebtedness of the Issuer;

(d) is effectively senior, to the extent of the value of the Collateral, to any unsecured Indebtedness of the Issuer and any Indebtedness of the Issuer secured by a lien on the Collateral that is junior to the lien securing this Note.

Denominations

The Notes are issuable only in registered form, without coupons, in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof.

Optional Redemption

Make-Whole Redemption (Prior to April 15, 2025)

At any time prior to April 15, 2025, the Issuer may redeem the Notes, at its option, in whole or in part, upon not less than 10 nor more than 60 days' prior notice, at a redemption price equal to 100% of the principal amount of the Notes redeemed, plus the Applicable Premium as of, and accrued and unpaid interest (including Additional Interest, if any) to, but not including, the redemption date (subject to the right of holders of record on the relevant Record Date to receive interest due on the relevant Interest Payment Date falling on or prior to the redemption date).

"Applicable Premium" means, with respect to any Note on any redemption date, the greater of:

(a) 1.0% of the principal amount of such Note; and

(b) the excess, if any, of:

(i) the present value at such redemption date of (A) the redemption price of such Note at April 15, 2025 (as set forth in the table below under "Fixed Price Redemption Schedule," which is 104.375% of the principal amount), plus (B) all required remaining scheduled interest payments due on such Note through April 15, 2025 (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the Applicable Treasury Rate as of such redemption date plus 50 basis points; over

(ii) the principal amount of such Note on such redemption date.

The Applicable Treasury Rate shall be determined in accordance with the Indenture.

Equity Clawback (Prior to April 15, 2025)

At any time, or from time to time, prior to April 15, 2025, the Issuer may, upon not less than 10 nor more than 60 days' prior notice, redeem up to 40% of the original aggregate principal amount of the Notes issued under the Indenture (calculated after giving effect to any issuance of Additional Notes) with the net cash proceeds received by the Issuer from one or more Equity Offerings at a redemption price equal to 108.750% of the principal amount of the Notes redeemed, plus accrued and unpaid interest (including Additional Interest, if any) thereon, to but not including the redemption date (subject to the right of holders of record on the relevant Record Date to receive interest due on the relevant Interest Payment Date falling on or prior to the redemption date); provided that:

(a) at least 60% of the original aggregate principal amount of the Notes issued under the Indenture (calculated after giving effect to any issuance of Additional Notes) remains outstanding immediately after the occurrence of such redemption; and

(b) each such redemption occurs within 180 days after the closing of the applicable Equity Offering.

Fixed Price Redemption Schedule (On or After April 15, 2025)

On or after April 15, 2025, the Issuer may redeem the Notes, in whole or in part, upon not less than 10 nor more than 60 days' prior notice, at the following redemption prices (expressed as percentages of principal amount of the Notes to be redeemed), plus accrued and unpaid interest (including Additional Interest, if any) thereon to, but not including, the redemption date (subject to the right of holders of record on the relevant Record Date to receive interest due on the relevant Interest Payment Date falling on or prior to the redemption date), if redeemed during the twelve-month period beginning on April 15 of the years indicated below:

Partial Redemption Mechanics

In the event that fewer than all of the Notes are to be redeemed at any time, the particular Notes (or portions thereof) to be redeemed shall be selected by the Trustee from among the outstanding Notes not previously called for redemption, by lot, on a pro rata basis, or by such other method as may be required by DTC, Thackeray Partners LLC, or Ashgrove Enterprises, as applicable, in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed at the time of such redemption, or, if the Notes are not then listed on a national securities exchange, on a pro rata basis or by lot.

Notice of redemption shall be mailed (or otherwise transmitted in accordance with the applicable procedures of DTC, Thackeray Partners LLC, or Ashgrove Enterprises) by first-class mail, postage prepaid, not less than 10 days nor more than 60 days prior to the redemption date, to each holder of Notes to be redeemed at its registered address. Any notice of redemption may, at the Issuer's discretion, be subject to one or more conditions precedent, including completion of a related financing transaction.

Change of Control

Upon the occurrence of a Change of Control (as defined in the Indenture), each holder of Notes shall have the right to require the Issuer to repurchase all or any portion (in minimum principal amounts of $2,000 and integral multiples of $1,000 in excess thereof) of such holder's Notes at a purchase price in cash equal to 101% of the aggregate principal amount of the Notes to be repurchased, plus accrued and unpaid interest (including Additional Interest, if any) thereon to, but not including, the date of repurchase. The procedures for conducting a Change of Control Offer are set forth in Article 4 of the Indenture.

Certain Covenants

The Indenture contains covenants that, among other things, limit the ability of the Issuer and its Restricted Subsidiaries to:

(a) incur additional Indebtedness, subject to an incurrence-based test under which the Consolidated Leverage Ratio of the Issuer and its Restricted Subsidiaries on a pro forma basis shall not exceed 3.75 to 1.00, and subject to certain carve-outs and exceptions set forth in the Indenture;

(b) make Restricted Payments, subject to a cumulative basket starting at $25,000,000, with additional capacity tied to, among other things, 50% of Consolidated Net Income, provided that the pro forma Consolidated Leverage Ratio does not exceed 3.00 to 1.00 after giving effect thereto;

(c) sell assets, subject to a requirement that at least 75% of the consideration received consist of cash or Cash Equivalents (or Replacement Assets), a 365-day reinvestment period with respect to the Net Proceeds of such sale, and the obligation to make an Asset Sale Offer at 100% of the principal amount of Notes to be repurchased if the aggregate amount of Excess Proceeds exceeds $25,000,000;

(d) create Liens on assets, subject to exceptions for Permitted Liens as defined in the Indenture;

(e) engage in certain transactions with Affiliates;

(f) enter into agreements that restrict dividends or other payments by Restricted Subsidiaries;

(g) designate Unrestricted Subsidiaries; and

(h) effect mergers, consolidations, and sales of all or substantially all assets,

all as more fully set forth in the Indenture. The descriptions above are qualified in their entirety by reference to the specific provisions of the Indenture.

Events of Default

Article 6 of the Indenture sets forth the Events of Default with respect to the Notes and the remedies available to the Trustee and the holders upon the occurrence and continuance of an Event of Default. Events of Default include, without limitation:

(a) failure to pay interest on any Note when due and payable, which failure continues for a period of 30 days;

(b) failure to pay the principal of, or premium (if any) on, any Note when due and payable at maturity, upon redemption, upon acceleration, or otherwise;

(c) failure by the Issuer or any Guarantor to comply with any other covenant or agreement contained in the Indenture or the Notes, subject to applicable notice and cure periods as set forth in the Indenture;

(d) default under any mortgage, indenture, or instrument evidencing or under which there is outstanding Indebtedness of the Issuer, any Guarantor, or any Restricted Subsidiary in an aggregate principal amount exceeding $20,000,000 (a "cross-default");

(e) certain events of bankruptcy, insolvency, or reorganization with respect to the Issuer, any Guarantor, or any Significant Subsidiary;

(f) the rendering of one or more final judgments against the Issuer, any Guarantor, or any Restricted Subsidiary in an aggregate amount in excess of $20,000,000 that remain undischarged for a period of 60 consecutive days (a "judgment default");

(g) any Guarantee ceasing to be in full force and effect (other than in accordance with the terms of the Indenture) or being declared null and void or unenforceable; and

(h) any security interest created by the Collateral Documents ceasing to be in full force and effect (other than in accordance with the terms thereof) or being declared null and void or unenforceable, or the Issuer or any Guarantor denying or disaffirming its obligations under any Collateral Document.

Reference is made to Article 6 of the Indenture for the complete terms of the Events of Default and the remedies available upon the occurrence and during the continuance thereof.

Defeasance

The Indenture permits, under certain circumstances set forth in Article 8 thereof, the Issuer to elect either (a) "Legal Defeasance," pursuant to which the Issuer will be deemed to have been discharged from all of its obligations with respect to the Notes and the Indenture (except for certain surviving obligations specified therein), or (b) "Covenant Defeasance," pursuant to which the Issuer will be released from its obligations under certain restrictive covenants contained in the Indenture, in each case upon the irrevocable deposit with the Trustee (or other qualifying entity) of money or U.S. Government Obligations sufficient to pay all remaining principal, premium (if any), and interest on the Notes to the Maturity Date (or the applicable redemption date) and satisfaction of the other conditions set forth in the Indenture.

Book-Entry Provisions — Regulation S

This Note is a Regulation S Global Note and is subject to the provisions of the Indenture relating to Global Notes, including, without limitation, the provisions of Section 2.06 thereof. Beneficial interests in this Note are held through Stonefield Industries ("Thackeray Partners LLC") and Harborview Industries ("Ashgrove Enterprises") as participants in DTC, or through other participants in DTC that hold interests on behalf of participants in Thackeray Partners LLC or Ashgrove Enterprises.

Beneficial interests in this Note may not be exchanged for Notes in certificated form except in the limited circumstances described in Section 2.06(e) of the Indenture, including (a) if DTC notifies the Issuer that it is unwilling or unable to continue as depositary for this Global Note or if DTC ceases to be a clearing agency registered under the Securities Exchange Act of 1934, as amended, and a successor depositary is not appointed within 90 days; (b) if the Issuer, at its option, notifies the Trustee in writing that it elects to cause the issuance of Notes in certificated form; or (c) if there shall have occurred and be continuing an Event of Default with respect to the Notes and DTC requests the issuance of certificated Notes.

Transfers of beneficial interests from this Regulation S Global Note to the Rule 144A Global Note (CUSIP: 891207 AA 3; ISIN: US891207AA38) may be made in accordance with the Indenture and applicable DTC, Thackeray Partners LLC, and Ashgrove Enterprises procedures, subject to delivery of certifications in the forms required by the Indenture (including the certification set forth in Exhibit B to the Indenture).

Transfer Restrictions — Regulation S

During the 40-day distribution compliance period following April 19, 2022 (i.e., through and including May 29, 2022) (the "Distribution Compliance Period"), beneficial interests in this Regulation S Global Note may only be held through Thackeray Partners LLC or Ashgrove Enterprises (or through accounts maintained by DTC participants on behalf of Thackeray Partners LLC or Ashgrove Enterprises).

After the expiration of the Distribution Compliance Period, beneficial interests in this Regulation S Global Note may be held through DTC directly or through any participant in DTC, subject to compliance with the transfer restrictions set forth in the Indenture and the legend on the face of this Note.

Transfers of beneficial interests in this Regulation S Global Note to qualified institutional buyers (as defined in Rule 144A under the Securities Act) shall require delivery of a certification by the transferor substantially in the form set forth in Exhibit B to the Indenture, confirming, among other things, that the transferee is a qualified institutional buyer purchasing for its own account or for the account of one or more qualified institutional buyers. Any such transfer shall result in a corresponding increase in the principal amount of the Rule 144A Global Note and a decrease in the principal amount of this Regulation S Global Note, and such changes shall be reflected on the Schedule of Exchanges of Interests attached hereto.

The foregoing restrictions on transfer are in addition to, and not in lieu of, any other applicable restrictions on transfer, including those set forth in the Indenture and the legends on the face of this Note.

Amendment, Modification, and Waiver

The Indenture permits, with certain exceptions as therein provided, the amendment, modification, or waiver of the provisions thereof and the Notes with the consent of the holders of at least a majority in aggregate principal amount of the Notes then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes). However, no such amendment, modification, or waiver may, without the consent of each affected holder:

(a) reduce the principal amount of Notes whose holders must consent to an amendment, supplement, or waiver;

(b) reduce the principal of or change the fixed maturity of any Note, or alter the provisions regarding the optional redemption of the Notes;

(d) waive a default or Event of Default in the payment of principal of, or premium (if any) or interest on, the Notes (except a rescission of acceleration of the Notes by the holders of at least a majority in aggregate principal amount of the Notes and a waiver of the payment default that resulted from such acceleration);

(e) make any Note payable in money other than United States dollars;

(f) make any change in the provisions of the Indenture relating to waivers of past defaults or the rights of holders of Notes to receive payments of principal of, premium (if any) or interest on, the Notes;

(g) release any Guarantor from any of its obligations under its Guarantee or the Indenture, except in accordance with the terms of the Indenture;

(h) release all or substantially all of the Collateral from the Liens of the Collateral Documents, except in accordance with the terms of the Indenture and the Collateral Documents; or

(i) make any change in the foregoing amendment and waiver provisions.

Article 9 of the Indenture also permits certain amendments without the consent of any holder of Notes. Reference is made to Article 9 of the Indenture for the full terms of the amendment, modification, and waiver provisions.

Governing Law

This Note, and any claim, controversy, or dispute arising under or related to this Note, shall be governed by, and construed in accordance with, the laws of the State of New York, without giving effect to the conflict-of-laws provisions thereof to the extent that the application of the laws of another jurisdiction would be required thereby (other than Sections 5-1401 and 5-1402 of the New York General Obligations Law, which shall apply).

Consent to Jurisdiction

Each of the Issuer and the Guarantors has irrevocably submitted to the exclusive jurisdiction of any New York State court or United States federal court sitting in the Borough of Manhattan, The City of New York, in any suit, action, or proceeding arising out of or relating to this Note or the Indenture, and has agreed that all claims in respect of any such suit, action, or proceeding may be heard and determined in any such court. Each of the Issuer and the Guarantors has irrevocably waived, to the fullest extent permitted by applicable law, any objection that it may now or hereafter have to the laying of venue of any such suit, action, or proceeding in any such court and any claim that any such suit, action, or proceeding has been brought in an inconvenient forum.

The Issuer, being a corporation incorporated under the Canada Business Corporations Act, has appointed an agent for service of process in the State of New York, as set forth in the Indenture. So long as any of the Notes remain outstanding, the Issuer will maintain a designated agent for service of process in the Borough of Manhattan, The City of New York.

Waiver of Jury Trial

EACH OF THE ISSUER, THE GUARANTORS, THE TRUSTEE, AND, BY ITS ACCEPTANCE OF THIS NOTE, EACH HOLDER OF THIS NOTE, HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS NOTE, THE INDENTURE, THE COLLATERAL DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

Authentication

This Note shall not be valid or obligatory for any purpose until the certificate of authentication hereon has been duly executed by the Trustee under the Indenture.

IN WITNESS WHEREOF, the Issuer has caused this Note to be duly executed.

TORCHLIGHT MINING CORP., as Issuer

By: ________

Name: [●]

Title: [●]

TRUSTEE'S CERTIFICATE OF AUTHENTICATION

This is one of the 8.750% Senior Secured Notes due 2029 referred to in the within-mentioned Indenture.

NORTHERN DOMINION TRUST COMPANY, as Trustee

By: ________

Authorized Signatory

Dated: [●]

[REVERSE OF REGULATION S GLOBAL NOTE]

GUARANTEE

Each of the undersigned Guarantors (each, a "Guarantor") hereby jointly and severally, irrevocably and unconditionally guarantees, on a senior secured basis, to each holder of a Note authenticated and delivered by the Trustee under the Indenture, and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, the Notes, or the obligations of the Issuer thereunder:

(a) the due and punctual payment of the principal of, premium (if any), and interest (including Additional Interest, if any) on the Notes, whether at the Maturity Date, by acceleration, upon redemption, repurchase, or otherwise, and all other monetary obligations of the Issuer under the Indenture and the Notes (including obligations to the Trustee), whether for fees, expenses, indemnification, or otherwise (all the foregoing being herein collectively called the "Guaranteed Obligations"); and

(b) in case of the failure of the Issuer punctually to make any payment of any Guaranteed Obligation, that each Guarantor will cause such payment to be made punctually when and as the same shall become due and payable, whether at the Maturity Date, by acceleration, upon redemption, repurchase, or otherwise, and as if such payment were made by the Issuer.

This Guarantee is subject to the terms and limitations set forth in Article 10 of the Indenture, including, without limitation, the provisions relating to the release of Guarantors and the limitations on enforcement necessary to avoid rendering any Guarantee a fraudulent conveyance or fraudulent transfer under applicable law.

Each Guarantee constitutes a senior secured obligation of the applicable Guarantor, ranking pari passu in right of payment with all existing and future senior Indebtedness of such Guarantor, ranking senior in right of payment to all existing and future subordinated Indebtedness of such Guarantor, and secured by a first-priority lien on substantially all tangible and intangible assets of such Guarantor (subject to Permitted Liens), as more fully described in the Indenture, the Security Agreement (U.S.), the General Security Agreement (Canada), and the Collateral Agency Agreement.

IN WITNESS WHEREOF, each of the undersigned Guarantors has caused this Guarantee to be duly executed.

WOLVERINE LAKE MINING LTD.

By: ________

Name: [●]

Title: [●]

TORCHLIGHT MILLING & PROCESSING INC.

By: ________

Name: [●]

Title: [●]

TORCHLIGHT U.S. HOLDINGS, INC.

By: ________

Name: [●]

Title: [●]

SCHEDULE OF EXCHANGES OF INTERESTS IN THE REGULATION S GLOBAL NOTE

The following exchanges of a part of this Global Note for an interest in another Global Note (including the Rule 144A Global Note, CUSIP: 891207 AA 3; ISIN: US891207AA38), or for a Certificated Note, or of an interest in another Global Note or a Certificated Note for a part of this Global Note, have been made:

FORM OF TRANSFER

FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto

[Insert name, address, and social security or taxpayer identification number of transferee]

$___ principal amount of the within Note, and hereby irrevocably constitutes and appoints _______ as attorney to transfer the within Note on the books of the Issuer, with full power of substitution in the premises.

Date: ________

Signature: ________

NOTICE: The signature to this assignment must correspond with the name as written upon the face of the within Note in every particular, without alteration or enlargement or any change whatsoever.

Signature Guarantee: ________

NOTICE: Signatures must be guaranteed by an "eligible guarantor institution" meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program ("STAMP") or such other "signature guarantee program" as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

ADDITIONAL CERTIFICATION

In connection with the transfer of the within Note, the undersigned hereby certifies that the transfer complies in all respects with the transfer restrictions set forth on the face of this Note and in the Indenture, including, without limitation, the restrictions on transfer set forth in Section 2.06 of the Indenture. The undersigned further certifies that it has complied with all conditions precedent to such transfer as set forth in the Indenture and the legends appearing on the face of this Note.

Date: ________

Signature: ________

REGULATION S TRANSFER CERTIFICATE

In connection with the transfer of the within Note or a beneficial interest therein to a transferee in reliance upon Regulation S under the Securities Act of 1933, as amended (the "Securities Act"), the undersigned hereby certifies as follows:

(i) the transfer is being effected in an "offshore transaction" within the meaning of Regulation S under the Securities Act;

(ii) the transferee is not a "U.S. person" as defined in Rule 902(k) of Regulation S under the Securities Act, and the transferee is acquiring the Notes in an offshore transaction in compliance with Rule 903 or Rule 904 of Regulation S;

(iii) the undersigned has complied with all applicable provisions of Regulation S under the Securities Act in connection with such transfer; and

(iv) the undersigned acknowledges that the Issuer, the Trustee, the Registrar, and their respective counsel shall be entitled to rely upon the truth and accuracy of the foregoing representations.

Date: ________

Signature: ________

Name:

Title:

RULE 144A TRANSFER CERTIFICATE

In connection with the transfer of a beneficial interest in this Regulation S Global Note to a beneficial interest in the Rule 144A Global Note (CUSIP: 891207 AA 3; ISIN: US891207AA38) in reliance upon Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), the undersigned hereby certifies as follows:

(i) the transferee is a "qualified institutional buyer" as defined in Rule 144A under the Securities Act;

(ii) the transferee is acquiring the Notes for its own account or for the account of one or more qualified institutional buyers, in each case in a principal amount of not less than $2,000;

(iii) the undersigned has complied with all applicable provisions of Rule 144A under the Securities Act in connection with such transfer;

(iv) the transfer is being effected in accordance with the transfer restrictions set forth in Section 2.06 of the Indenture; and

(v) the undersigned acknowledges that the Issuer, the Trustee, the Registrar, and their respective counsel shall be entitled to rely upon the truth and accuracy of the foregoing representations.

Date: ________

Signature: ________

Name:

Title:

[Remainder of page intentionally left blank]

Year	Redemption Price
2025	104.375%
2026	102.188%
2027 and thereafter	100.000%
Date of Exchange	Amount of Decrease in Principal Amount of this Global Note	Amount of Increase in Principal Amount of this Global Note	Principal Amount of this Global Note Following such Decrease (or Increase)	Signature of Authorized Signatory of Trustee

EXHIBIT A-2
FORM OF REGULATION S GLOBAL NOTE
[FACE OF REGULATION S GLOBAL NOTE]
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS NOTE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A NOTE REGISTERED, AND NO TRANSFER OF THIS NOTE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, (1) REPRESENTS THAT IT IS NOT A "U.S. PERSON" AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT AND THAT IT ACQUIRED THIS NOTE IN AN "OFFSHORE TRANSACTION" (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT), (2) AGREES FOR THE BENEFIT OF TORCHLIGHT MINING CORP. (THE "ISSUER") THAT IT WILL NOT OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE OR ANY BENEFICIAL INTEREST HEREIN EXCEPT IN COMPLIANCE WITH THE SECURITIES ACT AND ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION, AND (3) AGREES THAT, DURING THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT) FOLLOWING THE ORIGINAL ISSUE DATE OF THIS NOTE, THIS NOTE MAY NOT BE OFFERED, SOLD OR DELIVERED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS (AS DEFINED IN REGULATION S), EXCEPT PURSUANT TO RULE 144A UNDER THE SECURITIES ACT OR ANOTHER APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, FURTHER AGREES THAT ANY RESALE OR OTHER TRANSFER OF INTERESTS IN THIS NOTE (OR ANY BENEFICIAL INTEREST HEREIN) MAY BE MADE ONLY (A) TO THE ISSUER OR ANY SUBSIDIARY THEREOF, (B) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ONE OR MORE QUALIFIED INSTITUTIONAL BUYERS IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (D) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION.
TORCHLIGHT MINING CORP.
(a corporation incorporated under the Canada Business Corporations Act)
8.750% Senior Secured Notes due 2029
No. [●]
CUSIP: C89120 AA 5 ISIN: USC89120AA58
Initial Aggregate Principal Amount: $[●]
(up to $300,000,000 in the aggregate between the Rule 144A Global Note and this Regulation S Global Note)
Torchlight Mining Corp., a corporation incorporated under the Canada Business Corporations Act (herein called the "Issuer," which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co., as nominee for The Depository Trust Company ("DTC"), or registered assigns, the principal sum of $[●] (or such other principal amount as may be indicated on the Schedule of Exchanges of Interests in the Regulation S Global Note attached hereto, as such schedule may be adjusted from time to time), in lawful money of the United States of America, on April 15, 2029 (the "Maturity Date").
Interest
The Issuer promises to pay interest on the unpaid principal amount of this Note at the rate of 8.750% per annum from and including April 19, 2022 (the date of original issuance of the Notes), or from and including the most recent Interest Payment Date to which interest has been paid or duly provided for, to but not including the next succeeding Interest Payment Date or the Maturity Date, as the case may be. Interest on this Note shall be payable semi-annually in arrears on April 15 and October 15 of each year (each, an "Interest Payment Date"), commencing on October 15, 2022, to the Person in whose name this Note (or any predecessor Note) is registered at the close of business on the April 1 or October 1 (each, a "Record Date") immediately preceding the applicable Interest Payment Date, whether or not such day is a Business Day.
Interest on this Note shall be computed on the basis of a 360-day year comprised of twelve 30-day months.
In addition to the interest described above, Additional Interest may accrue on this Note pursuant to the terms of the Registration Rights Agreement, dated as of April 19, 2022, among the Issuer, the Guarantors, and the Initial Purchasers named therein (the "Registration Rights Agreement"), in the event of a failure by the Issuer or the Guarantors to satisfy certain registration obligations set forth therein. Any reference to "interest" in this Note shall be deemed to include Additional Interest, if any, that is then due and payable, unless the context otherwise requires.
Principal and Maturity
The entire outstanding principal amount of this Note, together with all accrued and unpaid interest thereon and all other amounts payable hereunder, shall be due and payable on the Maturity Date, April 15, 2029. All payments of principal on this Note shall be made in United States dollars in immediately available funds.
Payment Mechanics
Payments of principal of, premium (if any), and interest on this Note shall be made at the office or agency of the Issuer maintained for such purpose in the Borough of Manhattan, The City of New York, which office or agency shall initially be the corporate trust office of Northern Dominion Trust Company (the "Paying Agent"), located at 101 Barclay Street, 7th Floor, New York, New York 10286, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided that, at the option of the Issuer, payment of interest may be made by wire transfer of immediately available funds to the account of the holder as such account shall have been designated by the holder in writing to the Paying Agent not less than ten (10) Business Days prior to the applicable payment date.
For so long as this Note is a Global Note registered in the name of DTC or its nominee, all payments of principal of, premium (if any), and interest on this Note shall be made through the facilities of DTC in accordance with DTC's customary procedures (and, with respect to holders holding beneficial interests in this Note through Stonefield Industries ("Thackeray Partners LLC") or Harborview Industries ("Ashgrove Enterprises"), through the accounts of the respective depositaries of Thackeray Partners LLC and Ashgrove Enterprises at DTC). The Issuer, the Trustee, and the Paying Agent shall be entitled to treat the registered holder of this Note as the owner thereof for all purposes and shall not be affected by any notice to the contrary.
Reference to Indenture
This Note is one of the 8.750% Senior Secured Notes due 2029 (the "Notes") of the Issuer issued under the Indenture, dated as of April 19, 2022 (as amended, supplemented, restated, or otherwise modified from time to time in accordance with its terms, the "Indenture"), among Torchlight Mining Corp. (the "Issuer"), Wolverine Lake Mining Ltd., Torchlight Milling & Processing Inc., and Torchlight U.S. Holdings, Inc. (collectively, the "Guarantors"), and Northern Dominion Trust Company, as trustee (the "Trustee") and as collateral agent (the "Collateral Agent").
Reference is hereby made to the Indenture for a statement of the respective rights, limitations of rights, duties, and immunities thereunder of the Issuer, the Guarantors, the Trustee, the Collateral Agent, and the holders of the Notes, and of the terms upon which the Notes are, and are to be, authenticated and delivered. All terms, conditions, and provisions of the Indenture and the Notes are hereby incorporated by reference in this Note as if set forth herein at length, and the holder of this Note, by its acceptance hereof, assents to and agrees to be bound by all such terms, conditions, and provisions. In the event of any conflict or inconsistency between the terms of this Note and the terms of the Indenture, the terms of the Indenture shall govern and be controlling. Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Indenture.
Guarantee
The due and punctual payment of the principal of, premium (if any), and interest on this Note is jointly and severally, irrevocably, and unconditionally guaranteed on a senior secured basis by each of the Guarantors identified below, pursuant to Article 10 of the Indenture:
(a) Wolverine Lake Mining Ltd., a corporation organized under the laws of the Province of Ontario, Canada;
(b) Torchlight Milling & Processing Inc., a corporation organized under the laws of the Province of Ontario, Canada; and
(c) Torchlight U.S. Holdings, Inc., a corporation organized under the laws of the State of Delaware.
The Guarantees of the Guarantors are endorsed on the reverse hereof. Each such Guarantee constitutes a senior secured obligation of the applicable Guarantor, as more fully described in Article 10 of the Indenture.
Security
This Note and the related Guarantees are secured by a first-priority lien (subject to Permitted Liens as defined in the Indenture) on substantially all tangible and intangible assets of the Issuer and the Guarantors (collectively, the "Collateral"), as more fully described in:
(a) the Indenture;
(b) the Security Agreement (U.S.), dated as of April 19, 2022, among Torchlight U.S. Holdings, Inc. and Northern Dominion Trust Company, as Collateral Agent;
(c) the General Security Agreement (Canada), dated as of April 19, 2022, among Torchlight Mining Corp., Wolverine Lake Mining Ltd., Torchlight Milling & Processing Inc., and Northern Dominion Trust Company, as Collateral Agent; and
(d) the Collateral Agency Agreement, dated as of April 19, 2022, among the Issuer, the Guarantors, Northern Dominion Trust Company, as Trustee and Collateral Agent, and the other parties thereto.
Northern Dominion Trust Company acts as Collateral Agent under the Indenture, the Security Agreement (U.S.), the General Security Agreement (Canada), and the Collateral Agency Agreement.
Ranking
This Note constitutes a senior secured obligation of the Issuer. This Note:
(a) ranks pari passu in right of payment with all existing and future senior Indebtedness of the Issuer;
(b) ranks senior in right of payment to all existing and future subordinated Indebtedness of the Issuer;
(c) is secured by a first-priority lien on the Collateral (subject to Permitted Liens as defined in the Indenture); and
(d) is effectively senior, to the extent of the value of the Collateral, to any unsecured Indebtedness of the Issuer and any Indebtedness of the Issuer secured by a lien on the Collateral that is junior to the lien securing this Note.
Denominations
The Notes are issuable only in registered form, without coupons, in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof.
Optional Redemption
Make-Whole Redemption (Prior to April 15, 2025)
At any time prior to April 15, 2025, the Issuer may redeem the Notes, at its option, in whole or in part, upon not less than 10 nor more than 60 days' prior notice, at a redemption price equal to 100% of the principal amount of the Notes redeemed, plus the Applicable Premium as of, and accrued and unpaid interest (including Additional Interest, if any) to, but not including, the redemption date (subject to the right of holders of record on the relevant Record Date to receive interest due on the relevant Interest Payment Date falling on or prior to the redemption date).
"Applicable Premium" means, with respect to any Note on any redemption date, the greater of:
(a) 1.0% of the principal amount of such Note; and
(b) the excess, if any, of:
(i) the present value at such redemption date of (A) the redemption price of such Note at April 15, 2025 (as set forth in the table below under "Fixed Price Redemption Schedule," which is 104.375% of the principal amount), plus (B) all required remaining scheduled interest payments due on such Note through April 15, 2025 (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the Applicable Treasury Rate as of such redemption date plus 50 basis points; over
(ii) the principal amount of such Note on such redemption date.
The Applicable Treasury Rate shall be determined in accordance with the Indenture.
Equity Clawback (Prior to April 15, 2025)
At any time, or from time to time, prior to April 15, 2025, the Issuer may, upon not less than 10 nor more than 60 days' prior notice, redeem up to 40% of the original aggregate principal amount of the Notes issued under the Indenture (calculated after giving effect to any issuance of Additional Notes) with the net cash proceeds received by the Issuer from one or more Equity Offerings at a redemption price equal to 108.750% of the principal amount of the Notes redeemed, plus accrued and unpaid interest (including Additional Interest, if any) thereon, to but not including the redemption date (subject to the right of holders of record on the relevant Record Date to receive interest due on the relevant Interest Payment Date falling on or prior to the redemption date); provided that:
(a) at least 60% of the original aggregate principal amount of the Notes issued under the Indenture (calculated after giving effect to any issuance of Additional Notes) remains outstanding immediately after the occurrence of such redemption; and
(b) each such redemption occurs within 180 days after the closing of the applicable Equity Offering.
Fixed Price Redemption Schedule (On or After April 15, 2025)
On or after April 15, 2025, the Issuer may redeem the Notes, in whole or in part, upon not less than 10 nor more than 60 days' prior notice, at the following redemption prices (expressed as percentages of principal amount of the Notes to be redeemed), plus accrued and unpaid interest (including Additional Interest, if any) thereon to, but not including, the redemption date (subject to the right of holders of record on the relevant Record Date to receive interest due on the relevant Interest Payment Date falling on or prior to the redemption date), if redeemed during the twelve-month period beginning on April 15 of the years indicated below:
Partial Redemption Mechanics
In the event that fewer than all of the Notes are to be redeemed at any time, the particular Notes (or portions thereof) to be redeemed shall be selected by the Trustee from among the outstanding Notes not previously called for redemption, by lot, on a pro rata basis, or by such other method as may be required by DTC, Thackeray Partners LLC, or Ashgrove Enterprises, as applicable, in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed at the time of such redemption, or, if the Notes are not then listed on a national securities exchange, on a pro rata basis or by lot.
Notice of redemption shall be mailed (or otherwise transmitted in accordance with the applicable procedures of DTC, Thackeray Partners LLC, or Ashgrove Enterprises) by first-class mail, postage prepaid, not less than 10 days nor more than 60 days prior to the redemption date, to each holder of Notes to be redeemed at its registered address. Any notice of redemption may, at the Issuer's discretion, be subject to one or more conditions precedent, including completion of a related financing transaction.
Change of Control
Upon the occurrence of a Change of Control (as defined in the Indenture), each holder of Notes shall have the right to require the Issuer to repurchase all or any portion (in minimum principal amounts of $2,000 and integral multiples of $1,000 in excess thereof) of such holder's Notes at a purchase price in cash equal to 101% of the aggregate principal amount of the Notes to be repurchased, plus accrued and unpaid interest (including Additional Interest, if any) thereon to, but not including, the date of repurchase. The procedures for conducting a Change of Control Offer are set forth in Article 4 of the Indenture.
Certain Covenants
The Indenture contains covenants that, among other things, limit the ability of the Issuer and its Restricted Subsidiaries to:
(a) incur additional Indebtedness, subject to an incurrence-based test under which the Consolidated Leverage Ratio of the Issuer and its Restricted Subsidiaries on a pro forma basis shall not exceed 3.75 to 1.00, and subject to certain carve-outs and exceptions set forth in the Indenture;
(b) make Restricted Payments, subject to a cumulative basket starting at $25,000,000, with additional capacity tied to, among other things, 50% of Consolidated Net Income, provided that the pro forma Consolidated Leverage Ratio does not exceed 3.00 to 1.00 after giving effect thereto;
(c) sell assets, subject to a requirement that at least 75% of the consideration received consist of cash or Cash Equivalents (or Replacement Assets), a 365-day reinvestment period with respect to the Net Proceeds of such sale, and the obligation to make an Asset Sale Offer at 100% of the principal amount of Notes to be repurchased if the aggregate amount of Excess Proceeds exceeds $25,000,000;
(d) create Liens on assets, subject to exceptions for Permitted Liens as defined in the Indenture;
(e) engage in certain transactions with Affiliates;
(f) enter into agreements that restrict dividends or other payments by Restricted Subsidiaries;
(g) designate Unrestricted Subsidiaries; and
(h) effect mergers, consolidations, and sales of all or substantially all assets,
all as more fully set forth in the Indenture. The descriptions above are qualified in their entirety by reference to the specific provisions of the Indenture.
Events of Default
Article 6 of the Indenture sets forth the Events of Default with respect to the Notes and the remedies available to the Trustee and the holders upon the occurrence and continuance of an Event of Default. Events of Default include, without limitation:
(a) failure to pay interest on any Note when due and payable, which failure continues for a period of 30 days;
(b) failure to pay the principal of, or premium (if any) on, any Note when due and payable at maturity, upon redemption, upon acceleration, or otherwise;
(c) failure by the Issuer or any Guarantor to comply with any other covenant or agreement contained in the Indenture or the Notes, subject to applicable notice and cure periods as set forth in the Indenture;
(d) default under any mortgage, indenture, or instrument evidencing or under which there is outstanding Indebtedness of the Issuer, any Guarantor, or any Restricted Subsidiary in an aggregate principal amount exceeding $20,000,000 (a "cross-default");
(e) certain events of bankruptcy, insolvency, or reorganization with respect to the Issuer, any Guarantor, or any Significant Subsidiary;
(f) the rendering of one or more final judgments against the Issuer, any Guarantor, or any Restricted Subsidiary in an aggregate amount in excess of $20,000,000 that remain undischarged for a period of 60 consecutive days (a "judgment default");
(g) any Guarantee ceasing to be in full force and effect (other than in accordance with the terms of the Indenture) or being declared null and void or unenforceable; and
(h) any security interest created by the Collateral Documents ceasing to be in full force and effect (other than in accordance with the terms thereof) or being declared null and void or unenforceable, or the Issuer or any Guarantor denying or disaffirming its obligations under any Collateral Document.
Reference is made to Article 6 of the Indenture for the complete terms of the Events of Default and the remedies available upon the occurrence and during the continuance thereof.
Defeasance
The Indenture permits, under certain circumstances set forth in Article 8 thereof, the Issuer to elect either (a) "Legal Defeasance," pursuant to which the Issuer will be deemed to have been discharged from all of its obligations with respect to the Notes and the Indenture (except for certain surviving obligations specified therein), or (b) "Covenant Defeasance," pursuant to which the Issuer will be released from its obligations under certain restrictive covenants contained in the Indenture, in each case upon the irrevocable deposit with the Trustee (or other qualifying entity) of money or U.S. Government Obligations sufficient to pay all remaining principal, premium (if any), and interest on the Notes to the Maturity Date (or the applicable redemption date) and satisfaction of the other conditions set forth in the Indenture.
Book-Entry Provisions — Regulation S
This Note is a Regulation S Global Note and is subject to the provisions of the Indenture relating to Global Notes, including, without limitation, the provisions of Section 2.06 thereof. Beneficial interests in this Note are held through Stonefield Industries ("Thackeray Partners LLC") and Harborview Industries ("Ashgrove Enterprises") as participants in DTC, or through other participants in DTC that hold interests on behalf of participants in Thackeray Partners LLC or Ashgrove Enterprises.
Beneficial interests in this Note may not be exchanged for Notes in certificated form except in the limited circumstances described in Section 2.06(e) of the Indenture, including (a) if DTC notifies the Issuer that it is unwilling or unable to continue as depositary for this Global Note or if DTC ceases to be a clearing agency registered under the Securities Exchange Act of 1934, as amended, and a successor depositary is not appointed within 90 days; (b) if the Issuer, at its option, notifies the Trustee in writing that it elects to cause the issuance of Notes in certificated form; or (c) if there shall have occurred and be continuing an Event of Default with respect to the Notes and DTC requests the issuance of certificated Notes.
Transfers of beneficial interests from this Regulation S Global Note to the Rule 144A Global Note (CUSIP: 891207 AA 3; ISIN: US891207AA38) may be made in accordance with the Indenture and applicable DTC, Thackeray Partners LLC, and Ashgrove Enterprises procedures, subject to delivery of certifications in the forms required by the Indenture (including the certification set forth in Exhibit B to the Indenture).
Transfer Restrictions — Regulation S
During the 40-day distribution compliance period following April 19, 2022 (i.e., through and including May 29, 2022) (the "Distribution Compliance Period"), beneficial interests in this Regulation S Global Note may only be held through Thackeray Partners LLC or Ashgrove Enterprises (or through accounts maintained by DTC participants on behalf of Thackeray Partners LLC or Ashgrove Enterprises).
After the expiration of the Distribution Compliance Period, beneficial interests in this Regulation S Global Note may be held through DTC directly or through any participant in DTC, subject to compliance with the transfer restrictions set forth in the Indenture and the legend on the face of this Note.
Transfers of beneficial interests in this Regulation S Global Note to qualified institutional buyers (as defined in Rule 144A under the Securities Act) shall require delivery of a certification by the transferor substantially in the form set forth in Exhibit B to the Indenture, confirming, among other things, that the transferee is a qualified institutional buyer purchasing for its own account or for the account of one or more qualified institutional buyers. Any such transfer shall result in a corresponding increase in the principal amount of the Rule 144A Global Note and a decrease in the principal amount of this Regulation S Global Note, and such changes shall be reflected on the Schedule of Exchanges of Interests attached hereto.
The foregoing restrictions on transfer are in addition to, and not in lieu of, any other applicable restrictions on transfer, including those set forth in the Indenture and the legends on the face of this Note.
Amendment, Modification, and Waiver
The Indenture permits, with certain exceptions as therein provided, the amendment, modification, or waiver of the provisions thereof and the Notes with the consent of the holders of at least a majority in aggregate principal amount of the Notes then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes). However, no such amendment, modification, or waiver may, without the consent of each affected holder:
(a) reduce the principal amount of Notes whose holders must consent to an amendment, supplement, or waiver;
(b) reduce the principal of or change the fixed maturity of any Note, or alter the provisions regarding the optional redemption of the Notes;
(c) reduce the rate of or change the time for payment of interest on any Note;
(d) waive a default or Event of Default in the payment of principal of, or premium (if any) or interest on, the Notes (except a rescission of acceleration of the Notes by the holders of at least a majority in aggregate principal amount of the Notes and a waiver of the payment default that resulted from such acceleration);
(e) make any Note payable in money other than United States dollars;
(f) make any change in the provisions of the Indenture relating to waivers of past defaults or the rights of holders of Notes to receive payments of principal of, premium (if any) or interest on, the Notes;
(g) release any Guarantor from any of its obligations under its Guarantee or the Indenture, except in accordance with the terms of the Indenture;
(h) release all or substantially all of the Collateral from the Liens of the Collateral Documents, except in accordance with the terms of the Indenture and the Collateral Documents; or
(i) make any change in the foregoing amendment and waiver provisions.
Article 9 of the Indenture also permits certain amendments without the consent of any holder of Notes. Reference is made to Article 9 of the Indenture for the full terms of the amendment, modification, and waiver provisions.
Governing Law
This Note, and any claim, controversy, or dispute arising under or related to this Note, shall be governed by, and construed in accordance with, the laws of the State of New York, without giving effect to the conflict-of-laws provisions thereof to the extent that the application of the laws of another jurisdiction would be required thereby (other than Sections 5-1401 and 5-1402 of the New York General Obligations Law, which shall apply).
Consent to Jurisdiction
Each of the Issuer and the Guarantors has irrevocably submitted to the exclusive jurisdiction of any New York State court or United States federal court sitting in the Borough of Manhattan, The City of New York, in any suit, action, or proceeding arising out of or relating to this Note or the Indenture, and has agreed that all claims in respect of any such suit, action, or proceeding may be heard and determined in any such court. Each of the Issuer and the Guarantors has irrevocably waived, to the fullest extent permitted by applicable law, any objection that it may now or hereafter have to the laying of venue of any such suit, action, or proceeding in any such court and any claim that any such suit, action, or proceeding has been brought in an inconvenient forum.
The Issuer, being a corporation incorporated under the Canada Business Corporations Act, has appointed an agent for service of process in the State of New York, as set forth in the Indenture. So long as any of the Notes remain outstanding, the Issuer will maintain a designated agent for service of process in the Borough of Manhattan, The City of New York.
Waiver of Jury Trial
EACH OF THE ISSUER, THE GUARANTORS, THE TRUSTEE, AND, BY ITS ACCEPTANCE OF THIS NOTE, EACH HOLDER OF THIS NOTE, HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS NOTE, THE INDENTURE, THE COLLATERAL DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
Authentication
This Note shall not be valid or obligatory for any purpose until the certificate of authentication hereon has been duly executed by the Trustee under the Indenture.
IN WITNESS WHEREOF, the Issuer has caused this Note to be duly executed.
TORCHLIGHT MINING CORP., as Issuer
By: ________
Name: [●]
Title: [●]
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 8.750% Senior Secured Notes due 2029 referred to in the within-mentioned Indenture.
NORTHERN DOMINION TRUST COMPANY, as Trustee
By: ________
Authorized Signatory
Dated: [●]
[REVERSE OF REGULATION S GLOBAL NOTE]
GUARANTEE
Each of the undersigned Guarantors (each, a "Guarantor") hereby jointly and severally, irrevocably and unconditionally guarantees, on a senior secured basis, to each holder of a Note authenticated and delivered by the Trustee under the Indenture, and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, the Notes, or the obligations of the Issuer thereunder:
(a) the due and punctual payment of the principal of, premium (if any), and interest (including Additional Interest, if any) on the Notes, whether at the Maturity Date, by acceleration, upon redemption, repurchase, or otherwise, and all other monetary obligations of the Issuer under the Indenture and the Notes (including obligations to the Trustee), whether for fees, expenses, indemnification, or otherwise (all the foregoing being herein collectively called the "Guaranteed Obligations"); and
(b) in case of the failure of the Issuer punctually to make any payment of any Guaranteed Obligation, that each Guarantor will cause such payment to be made punctually when and as the same shall become due and payable, whether at the Maturity Date, by acceleration, upon redemption, repurchase, or otherwise, and as if such payment were made by the Issuer.
This Guarantee is subject to the terms and limitations set forth in Article 10 of the Indenture, including, without limitation, the provisions relating to the release of Guarantors and the limitations on enforcement necessary to avoid rendering any Guarantee a fraudulent conveyance or fraudulent transfer under applicable law.
Each Guarantee constitutes a senior secured obligation of the applicable Guarantor, ranking pari passu in right of payment with all existing and future senior Indebtedness of such Guarantor, ranking senior in right of payment to all existing and future subordinated Indebtedness of such Guarantor, and secured by a first-priority lien on substantially all tangible and intangible assets of such Guarantor (subject to Permitted Liens), as more fully described in the Indenture, the Security Agreement (U.S.), the General Security Agreement (Canada), and the Collateral Agency Agreement.
IN WITNESS WHEREOF, each of the undersigned Guarantors has caused this Guarantee to be duly executed.
WOLVERINE LAKE MINING LTD.
By: ________
Name: [●]
Title: [●]
TORCHLIGHT MILLING & PROCESSING INC.
By: ________
Name: [●]
Title: [●]
TORCHLIGHT U.S. HOLDINGS, INC.
By: ________
Name: [●]
Title: [●]
SCHEDULE OF EXCHANGES OF INTERESTS IN THE REGULATION S GLOBAL NOTE
The following exchanges of a part of this Global Note for an interest in another Global Note (including the Rule 144A Global Note, CUSIP: 891207 AA 3; ISIN: US891207AA38), or for a Certificated Note, or of an interest in another Global Note or a Certificated Note for a part of this Global Note, have been made:
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto
[Insert name, address, and social security or taxpayer identification number of transferee]
$___ principal amount of the within Note, and hereby irrevocably constitutes and appoints _______ as attorney to transfer the within Note on the books of the Issuer, with full power of substitution in the premises.
Date: ________
Signature: ________
NOTICE: The signature to this assignment must correspond with the name as written upon the face of the within Note in every particular, without alteration or enlargement or any change whatsoever.
Signature Guarantee: ________
NOTICE: Signatures must be guaranteed by an "eligible guarantor institution" meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program ("STAMP") or such other "signature guarantee program" as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.
ADDITIONAL CERTIFICATION
In connection with the transfer of the within Note, the undersigned hereby certifies that the transfer complies in all respects with the transfer restrictions set forth on the face of this Note and in the Indenture, including, without limitation, the restrictions on transfer set forth in Section 2.06 of the Indenture. The undersigned further certifies that it has complied with all conditions precedent to such transfer as set forth in the Indenture and the legends appearing on the face of this Note.
Date: ________
Signature: ________
REGULATION S TRANSFER CERTIFICATE
In connection with the transfer of the within Note or a beneficial interest therein to a transferee in reliance upon Regulation S under the Securities Act of 1933, as amended (the "Securities Act"), the undersigned hereby certifies as follows:
(i) the transfer is being effected in an "offshore transaction" within the meaning of Regulation S under the Securities Act;
(ii) the transferee is not a "U.S. person" as defined in Rule 902(k) of Regulation S under the Securities Act, and the transferee is acquiring the Notes in an offshore transaction in compliance with Rule 903 or Rule 904 of Regulation S;
(iii) the undersigned has complied with all applicable provisions of Regulation S under the Securities Act in connection with such transfer; and
(iv) the undersigned acknowledges that the Issuer, the Trustee, the Registrar, and their respective counsel shall be entitled to rely upon the truth and accuracy of the foregoing representations.
Date: ________
Signature: ________
Name:
Title:
RULE 144A TRANSFER CERTIFICATE
In connection with the transfer of a beneficial interest in this Regulation S Global Note to a beneficial interest in the Rule 144A Global Note (CUSIP: 891207 AA 3; ISIN: US891207AA38) in reliance upon Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), the undersigned hereby certifies as follows:
(i) the transferee is a "qualified institutional buyer" as defined in Rule 144A under the Securities Act;
(ii) the transferee is acquiring the Notes for its own account or for the account of one or more qualified institutional buyers, in each case in a principal amount of not less than $2,000;
(iii) the undersigned has complied with all applicable provisions of Rule 144A under the Securities Act in connection with such transfer;
(iv) the transfer is being effected in accordance with the transfer restrictions set forth in Section 2.06 of the Indenture; and
(v) the undersigned acknowledges that the Issuer, the Trustee, the Registrar, and their respective counsel shall be entitled to rely upon the truth and accuracy of the foregoing representations.
Date: ________
Signature: ________
Name:
Title:
[Remainder of page intentionally left blank]
Year | Redemption Price
2025 | 104.375%
2026 | 102.188%
2027 and thereafter | 100.000%
Date of Exchange | Amount of Decrease in Principal Amount of this Global Note | Amount of Increase in Principal Amount of this Global Note | Principal Amount of this Global Note Following such Decrease (or Increase) | Signature of Authorized Signatory of Trustee

EXHIBIT A-2

FORM OF REGULATION S GLOBAL NOTE

TORCHLIGHT MINING CORP.

CUSIP: C89120 AA 5 ISIN: USC89120AA58

TRUSTEE'S CERTIFICATE OF AUTHENTICATION

GUARANTEE

WOLVERINE LAKE MINING LTD.

TORCHLIGHT MILLING & PROCESSING INC.

TORCHLIGHT U.S. HOLDINGS, INC.

SCHEDULE OF EXCHANGES OF INTERESTS IN THE REGULATION S GLOBAL NOTE

FORM OF TRANSFER

ADDITIONAL CERTIFICATION

REGULATION S TRANSFER CERTIFICATE

RULE 144A TRANSFER CERTIFICATE

Record

Parties

Dates

Amounts