CONVERTIBLE PROMISSORY NOTEConvertible Promissory Note |
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CONVERTIBLE
PROMISSORY NOTE
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$250,000.00
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August
17, 2007
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FOR
THE
AMOUNT OF TWO HUNDRED THOUSAND DOLLARS ($200,000.00) CASH RECEIVED, the
undersigned, VoIP, INC., a Texas corporation (the "Company"), promises to pay
to
the order of CARRIE
ANGEL,
or its
successors or assigns ("Holder"), at such place as the Holder may designate
in
writing to the Company, in lawful money of the United States of America, the
principal sum of Two Hundred Fifty Thousand Dollars ($250,000.00), due and
payable on September 1, 2007.
In
the
event that the Company fails to repay this promissory note (this “Note”) when
due, the Holder may, at its option, formally declare the Company to be in
default hereunder. In that event, this Note shall become immediately convertible
in whole or in part, at Holder’s option, into free-trading shares of the
Company’s common stock, par value $0.001 per share (“Common Stock”), at the
conversion rate of the lesser of: (a) $1.60 per share (post-reverse split);
or
(b) a 50% discount to the average of the closing market price of the Company’s
common stock over the five trading days immediately preceding such conversion.
In that event, the Company will use its best efforts to effect the free-trading
shares through a 3(a)(10) settlement.
Holder
shall also be entitled to receive 5-year warrants (“Warrants”) to purchase
available shares of the Company’s common stock exercisable at $1.60 per warrant
share (the “Exercise Price”). The number of warrants Holder shall receive will
be based upon the amount due under this Note as of the Maturity Date divided
by
the Exercise Price, and the warrants shall contain a cashless exercise
feature.
So
long
as the Warrants are outstanding, if the Company shall issue or agree to issue
any shares of Common Stock for a consideration less than the Exercise Price
in
effect at the time of such issue or agree to adjust the price at which any
shares of Common Stock may be issued, then, and thereafter successively upon
each such issue or adjustment, the Exercise Price shall be reduced
