THIS NOTE AND THE SECURITIES ISSUABLE UPON ITS CONVERSION HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY
STATE SECURITIES LAW, AND MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION UNDER THE ACT OR IN A TRANSACTION WHICH, IN THE OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE COMPANY, QUALIFIES AS AN EXEMPT TRANSACTION UNDER
THE ACT AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER.
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CONVERTIBLE PROMISSORY NOTE
$200,000 December 23, 2003
1. Obligations
(a) The undersigned, ICOA, Inc., a Nevada corporation having an address at
000 Xxxxxxx Xx., Xxxxxxx, XX 00000 (the "Company"), has agreed to acquire 100%
of the outstanding shares of Airport Network Solutions, Inc. (ANS) for the cash
sum of Two Hundred Thousand ($200,000). The Company hereby promises to pay to
the Shareholders of ANS, as identified in Schedule A attached hereto, together
with their successors, representatives and permitted assigns (the "Holder"), in
accordance with the terms hereinafter provided, the principal amount of Two
Hundred Thousand Dollars ($200,000) in the aggregate, together with interest
thereon as set forth herein, on December 18, 2005, (the "Maturity Date"), at the
Holder's address as set forth in Schedule A, or such other place as the Holder
shall specify in writing.
(b) The outstanding principal balance of this Note shall bear interest at a
rate per annum equal to Five percent (5%) from the date which is one year from
the date hereof until paid in full, unless earlier converted as provided herein.
Interest shall be computed on the basis of a 360-day year of twelve (12) 30-day
months.
(c) All payments received from the Company hereunder shall be applied,
first, to the payment of expenses and fees due to the Holder pursuant to the
terms of this Note; second, to the payment of interest accrued and unpaid on
this Note; and third, to reduce the principal balance hereunder.
(d) The Company shall not be entitled to prepay the unpaid principal
balance hereof, in whole or in part, except by written consent of the Holder.
2. Conversion at the Option of the Holder At any time and from time to time
prior to the Maturity Date, at such time as the Company shall have authorized a
sufficient number of shares of Common Stock to effect the forgoing (the
"Conversion Shares"), this Note shall be convertible (in whole or in part), at
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the option of the Holder by prior written notice to the Company, into such
number of fully-paid and non-assessable shares of Common Stock that shall be
obtained by dividing the sum of the outstanding principal amount to be
converted, by the $0.01 per share. Accrued, but unpaid interest at the time of
conversion shall be paid in cash. Upon such conversion, this Note and the
obligations evidenced thereby shall be cancelled and shall be of no further
force and effect. If at any time the Holder shall convert less than the full
value of this Convertible Promissory Note, the Company shall re-issue the note
for the then remaining value.
3. Expenses.
The Company agrees to pay to the Holder all reasonable expenses
incurred by the Holder, including reasonable attorneys' fees, in enforcing and
collecting this Note.
4. Events of Default.
Each of the following events shall constitute a default under this Note
(each an "Event of Default"): (a) any default shall occur in the payment of any
amount payable under this Note, (b) any proceedings are instituted in a court of
competent jurisdiction for the reorganization, liquidation, or dissolution of
the Company or for its adjudication as a bankrupt or insolvent and if instituted
by a third party, such proceedings are not dismissed, discharged or stayed
within sixty (60) days from the date such proceedings are instituted; (c) the
Company makes an assignment for the benefit of its creditors; (d) a receiver,
liquidator, assignee, trustee or custodian is appointed to administer the
affairs of the Company; or (e) the Company dissolves, liquidates or winds-up its
business and operations.
Upon the occurrence and at any time during the continuance of any Event
of Default, the Holder shall be entitled to (a) declare this Note, and any and
all principal, interest and other amounts due under this Note to be immediately
due and payable, and (b) exercise or otherwise enforce any one or more of the
Holder's rights, powers, privileges, remedies and interests under this Note or
applicable law.
7. Holder's Representations. By its acceptance of this Note, Holder confirms the
following to the Company:
(a) All subsequent offers and sales of the Conversion Shares shall be made
pursuant to an effective registration statement under the Securities Act of
1933, as amended, and applicable state securities laws or pursuant to an
applicable exemption from such registration.
(b) Holder: (i) has been provided with sufficient information with respect
to the business of the Company and its subsidiaries and such documents relating
to the Company and its subsidiaries as such Holder has requested and Holder has
carefully reviewed the same, and (ii) has had access to management of the
Company and the opportunity to discuss the information provided by management of
the Company and any questions that Holder had with respect thereto have been
answered to the full satisfaction of Holder.
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8. Note Obligations Binding; No Waiver.
This Note is binding on the Company and its respective successors and
assigns, and the Company hereby waives presentment, demand, notice and protest
and any defense by reason of an extension of time for payment or other
indulgences. Failure of the Holder to assert any right herein shall not be
deemed to be a waiver thereof.
9. Governing Law.
This Note shall be governed by and construed and enforced in accordance
with the laws of the State of Rhode Island, without giving effect to principles
of conflicts of law thereof.
10. Amendment; Severability.
This Note may not be modified, amended or waived except in writing
signed by the Holder.
ICOA, INC.
By: /s/ Xxxxx Xxxxxxxx, Xx.
Name: Xxxxx Xxxxxxxx, Xx.
Title: CFO
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Schedule A
Airport Network Solutions, Inc. - Shareholders
Xxxxxxx Xxxxxxxxxx 50.97%
000 Xxxxxxxx Xxx.
Xxx Xxxxxxxxx, XX 00000
Xxxxxx Xxxxx 44.61%
0000 XX Xxxxxxx Xx
Xxxxxxxx, XX 00000
Xxx Xxxxxxx 4.43%
000 Xxxxxxxx Xxx.
Xxx Xxxxxxxxx, XX 00000