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Exhibit 4.3
NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS
SECURITY IS CONVERTIBLE
HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION
FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO
SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY
ACCEPTABLE TO THE
COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON
CONVERSION OF THIS
SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT OR OTHER
LOAN SECURED BY SUCH SECURITIES.
KNOBIAS, INC.
8% CONVERTIBLE PROMISSORY NOTE
$75,000.00 April 22, 2005
Ridgeland, Mississippi
FOR VALUE RECEIVED, Knobias, Inc., a Delaware corporation (the
"Company"),
hereby promises to pay to Bridges & PIPES, LLC, a Delaware
limited liability
company (the "Holder"), the principal sum of SEVENTY FIVE
THOUSAND and NO/100
DOLLARS ($75,000.00), together with interest thereon from the
date hereof on the
unpaid balance of such principal amount. Interest shall accrue
and be deemed to
have accrued from the date hereof on the unpaid principal amount
at a rate equal
to eight percent (8%) per annum.
This Note is subject to the following terms and conditions.
1. Maturity. This Note will automatically mature and be due and
payable in
full on the first to occur of (a) the completion of additional
financing in
which the Company realizes at least $1,500,000 in gross
proceeds, or (b) that
date which is four (4) months immediately following the date of
this Note.
Anything contained herein to the contrary notwithstanding, all
unpaid
principal sum(s) of this Note, together with accrued and unpaid
interest
thereon, shall become immediately due and payable in full
without notice,
demand, presentment, protest or other formalities of any kind
(all of which are
hereby expressly waived by the Company) upon the insolvency of
the Company, the
commission of any act of bankruptcy by the Company, the
execution by the Company
of a general assignment for the benefit of creditors, the filing
by or against
the Company of a petition in bankruptcy or any petition for
relief under the
federal bankruptcy act or the continuation of such petition
without dismissal
for a period of sixty (60) days or more, or the appointment of a
receiver or
trustee to take possession of the property or assets of the
Company.
<PAGE>
2. Payment and Interest. All payments shall be made in lawful
money of the
United States of America at such place as the Holder hereof may
from time to
time designate in writing to the Company. Payment shall be
credited first to the
accrued interest then due and payable and the remainder applied
to principal.
Prepayment of this Note may be made at any time without penalty.
The Company
shall pay interest to the Holder on the aggregate unconverted
and then
outstanding principal amount of this Note at the rate of 8% per
annum, payable,
upon Maturity pursuant to Section 1 hereof, in cash.
3. Default. Failure to make any payment, whether of principal or
interest,
after such amount becomes due shall constitute a default ("Event
of Default") by
the Company. If an Event of Default shall occur, then,
notwithstanding any other
agreement now or hereafter existing, all principal and interest
on this Note
shall become immediately due and payable without notice,
presentation, demand
for payment or protest, all of which are hereby expressly
waived. The Company
covenants and agrees to advise the Holder, in writing, of the
happening or
occurrence of any Event of Default.
4. Conversion.
(a) Voluntary Conversion. At any time after the date hereof
until
this Note is no longer outstanding, this Note shall be
convertible into shares
of the Company's common stock, $0.01 par value per share (the
"Common Stock"),
at the option of the Holder, in whole or in part at any time and
from time to
time (subject to the limitations on conversion set forth in
Section 4(c)
hereof). The Holder shall effect conversions by delivering to
the Company the
form of Notice of Conversion attached hereto as Annex A ("Notice
of
Conversion"), specifying therein the principal amount of the
Note to be
converted and the date on which such conversion is to be
effected ("Conversion
Date"). If no Conversion Date is specified in a Notice of
Conversion, the
Conversion Date shall be the date that such Notice of Conversion
is provided
hereunder. To effect conversions hereunder, the Holder shall not
be required to
physically surrender the Note to the Company unless the entire
principal amount
of this Note plus all accrued and unpaid interest thereon has
been so converted.
Conversions hereunder shall have the effect of lowering the
outstanding
principal amount of this Note in an amount equal to the
applicable conversion.
The Holder and the Company shall maintain records showing the
principal amount
converted and the date of such conversions. The Company shall
deliver any
objection to any Notice of Conversion within three (3) Business
Days of receipt
of such notice. In the event of any dispute or discrepancy, the
records of the
Holder shall be controlling and determinative in the absence of
manifest error.
The Holder and any assignee, by acceptance of this Note,
acknowledge and agree
that, by reason of the provisions of this paragraph, following
conversion of a
portion of this Note, the unpaid and unconverted principal
amount of this Note
may be less than the amount stated on the face hereof. However,
at the Company's
request, the Holder shall surrender the Note to the Company
within five (5)
Trading Days following such request so that a new Note
reflecting the correct
principal amount may be issued to Holder.
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<PAGE>
(b) Conversion Price. The conversion price in effect on any
Conversion Date shall be equal to $0.60 per share of Common
Stock.
(c) Conversion Limitations; Holder's Restriction on Conversion.
The
Company shall not effect any conversion of this Note, and the
Holder shall not
have the right to convert any portion of this Note, pursuant to
Section 4(a) or
otherwise, to the extent that after giving effect to such
conversion, the Holder
(together with the Holder's affiliates), as set forth on the
applicable Notice
of Conversion, would beneficially own in excess of 4.99% of the
number of shares
of the Common Stock outstanding immediately after giving effect
to such
conversion. For purposes of the foregoing sentence, the number
of shares of
Common Stock beneficially owned by the Holder and its affiliates
shall include
the number of shares of Common Stock issuable upon conversion of
this Note with
respect to which the determination of such sentence is being
made, but shall
exclude the number of shares of Common Stock which would be
issuable upon (A)
conversion of the remaining, nonconverted portion of this Note
beneficially
owned by the Holder or any of its affiliates and (B) exercise or
conversion of
the unexercised or nonconverted portion of any other securities
of the Company
(including, without limitation, any other Notes or the Warrants)
subject to a
limitation on conversion or exercise analogous to the limitation
contained
herein beneficially owned by the Holder or any of its
affiliates. Except as set
forth in the preceding sentence, for purposes of this Section
4(c), beneficial
ownership shall be calculated in accordance with Section 13(d)
of the Securities
Exchange Act of 1934, as amended. To the extent that the
limitation contained in
this section applies, the determination of whether this Note is
convertible (in
relation to other securities owned by the Holder) and of which a
portion of this
Note is convertible shall be in the sole discretion of such
Holder. To ensure
compliance with this restriction, the Holder will be deemed to
represent to the
Company each time it delivers a Notice of Conversion that such
Notice of
Conversion has not violated the restrictions set forth in this
paragraph and the
Company shall have no obligation to verify or confirm the
accuracy of such
determination. For purposes of this Section 4(c), in determining
the number of
outstanding shares of Common Stock, the Holder may rely on the
number of
outstanding shares of Common Stock as reflected in (x) the
Company's most recent
Form 10-QSB or Form 10-KSB, as the case may be, (y) a more
recent public
announcement by the Company or (z) any other notice by the
Company or the
Company's Transfer Agent setting forth the number of shares of
Common Stock
outstanding. Upon the written or oral request of the Holder, the
Company shall
within two (2) Trading Days confirm orally and in writing to the
Holder the
number of shares of Common Stock then outstanding. In any case,
the number of
outstanding shares of Common Stock shall be determined after
giving effect to
the conversion or exercise of securities of the Company,
including this Note, by
the Holder or its affiliates since the date as of which such
number of
outstanding shares of Common Stock was reported. The provisions
of this Section
4(c) may be waived by the Holder upon, at the election of the
Holder, not less
than sixty-one (61) days
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