<PAGE>
EXHIBIT 10.80
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
(THE "ACT")
OR ANY APPLICABLE STATE SECURITIES LAWS. IT MAY NOT BE CONVERTED,
SOLD, OFFERED
FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION
STATEMENT IN
EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR AN OPINION
OF COUNSEL
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED.
SECURED CONVERTIBLE NOTE
$2,691,263.36
King of Prussia, Pennsylvania
FOR VALUE RECEIVED, the undersigned, SEDONA CORPORATION, a
Pennsylvania
corporation ("Maker"), promises to pay to the order of David R. Vey
("Holder"),
with the address of 11822 Justice Avenue Suite B-6, Baton Rouge,
Louisiana
70816, the principal sum of TWO MILLION SIX HUNDRED NINETY ONE
THOUSAND TWO
HUNDRED SIXTY THREE 36/100 dollars ($2,691,263.36) ("Loan"),
together with
interest thereon at the rate of eight percent (8%) per annum from
the date
hereof until the earlier of maturity or the date the balance shall
be paid in
full (this "Note"); provided that Holder shall be entitled at any
time during
the term of the Loan to convert the then outstanding balance of the
Loan into
shares of Common Stock at a price of $0.14 per share (the
"Conversion Price").
1.
Definitions. The following definitions are applicable to the
words,
phrases or terms used in this Note.
(a) The term "Common Stock" shall mean the Maker's common stock,
par
value $0.001 per share.
(b) The term "Holder" shall mean and include all heirs, successors
and
assigns of any owner or holder of this Note.
(c) The term "Maker" shall mean and include all makers, co-makers
and
other parties signing on the face of this Note and their successors
and assigns,
and the use of the plural number shall include the singular, and
vice versa, and
the use of any gender shall include all genders.
(d) The term "Maturity" shall mean the date on which this Note
shall
be due and payable in full, which date shall be October 23, 2008,
unless
theretofore converted.
(e) The term "Notice of Exercise" shall mean the Notice of
Exercise
substantially in the form of Exhibit A attached hereto.
(f) The term "Shares" shall mean all shares of Common Stock or
other
securities issued or issuable pursuant to the exercise of the
Notice of
Exercise.
<PAGE>
2.
Payment Terms. This Loan shall be effective commencing on October
23,
2006 (the "Effective Date") and continuing until two (2) years
after the
Effective Date. The Maker shall be obligated to make one payment of
all
outstanding principal and unpaid interest due thereon at Maturity.
Unless
otherwise designated in writing, mailed or delivered to Maker, the
place for
payment of the indebtedness evidenced by this Note shall be the
Holder's
principal address as noted above. Payments received on this Note
shall be
applied first to accrued interest, and the balance to
principal.
3.
Events of Default. The following shall constitute an Event of
Default:
(a) In the event Maker shall fail (i) to pay any sums due
hereunder
when due, or (ii) to observe or perform any term, condition,
covenant,
representation or warranty set forth herein, when due or required,
or within any
period of time permitted thereunder for cure of any such default
or
non-performance.
(b) Defaults. In the event Maker fails to pay any invoice or other
sum
which may be due and payable to Holder or Oak Harbor Investment
Properties,
L.L.C ("Oak Harbor"), when due or required, according to the terms
thereunder,
unless prior written waiver has been granted to Maker by Holder or
Oak Harbor.
(c) Defaults. In the event Maker has received notice of default on
any
financial obligation in excess of One Hundred Thousand Dollars
($100,000.00).
4.
Acceleration of Maturity. Upon the happening of any Event of
Default,
the unpaid principal and interest due Holder shall, at the option
of the Holder,
become immediately due and payable.
5.
Security. The obligation of the Maker pursuant to this Note is
secured
by a lien and security interest in the collateral of the Maker as
specifically
set forth in a Security Agreement of even date herewith (the
"Security
Agreement").
6.
Limitation on Interest. In no contingency, whether by reason of
acceleration of the Maturity of this Note or otherwise, shall the
interest
contracted for, charged or received by Holder exceed the maximum
amount
permissible under applicable law. If, from any circumstance
whatsoever, interest
would otherwise be payable to Holder in excess of the maximum
lawful amount, the
interest payable to Holder shall be reduced to the maximum amount
permitted
under applicable law; and, if from any circumstance the Holder
shall ever
receive anything of value deemed interest by applicable law in
excess of the
maximum lawful amount, an amount equal to any excessive interest
shall be
applied to the reduction of the principal of this Note and not to
the payment of
interest, or if such excessive interest exceeds the unpaid balance
of principal
of the Note such excess shall be refunded to Maker. All interest
paid or agreed
to be paid to Holder shall, to the extent permitted by applicable
law, be
amortized, prorated, allocated, and spread throughout the full
period until
payment in full of the principal of the Note (including the period
of any
renewal or extension thereof) so that interest thereon for such
full period
shall not exceed the maximum amount permitted by applicable
law.
<PAGE>
7.
Remedies; Nonwaiver. Failure of Holder to exercise any right or
remedy
available to Holder upon the occurrence of an Event of Default
hereunder shall
not constitute a waiver on the part of Holder of the right to
exercise any such
right or remedy for that Event of Default or any subsequent Event
of Default.
The exercise of any remedy by Holder shall not constitute an
election of any
such remedy to the exclusion of any other remedies afforded Holder
at law or in
equity, all such remedies being nonexclusive and cumulative. If an
Event of
Default occurs under this Note and this Note is referred to an
attorney at law
for collection, Maker agrees to pay all costs incurred by Holder
incident to
collection up to a limit of 10% of the unpaid principal balance,
including but
not limited to reasonable attorney fees, enforceable as a contract
of indemnity,
plus all court costs.
8.
Waivers. The Maker, endorsers, sureties and guarantors hereof, if
any,
severally (i) waive presentment, protest and demand, (ii) waive
notice of
protest, demand, dishonor and nonpayment of this Note, and (iii)
expressly agree
that this Note may be renewed in whole or in part, or any
nonpayment hereunder
may be extended, or a new note of different form may be substituted
for this
Note or changes may be made in consideration of the extension of
the Maturity
date hereof, or any combination thereof, from time to time, but, in
any singular
event or any combination of such events, neither Maker nor any
endorser, surety
or guarantor will be released from liability by reason of the
occurrence of any
such event, nor shall Holder hereof be deemed by the occurrence of
any such
event to have waived or surrendered, either in whole or in part,
any right it
otherwise might have.
9.
Option to Convert Note into Stock.
(a) The Maker represents that at any time during the term of the
Loan,
Holder shall have the right and option to convert (the "Conversion
Right") the
unpaid principal balance of this Note or any part thereof, together
with all
accrued and unpaid interest (the "Outstanding Balance"), into
shares of Maker's
voting Common Stock (the "Shares") having all rights inherent in
common stock
under the Maker's Articles of Incorporation and Bylaws in effect as
of the date
hereof. The number of Shares to be paid on conversion shall be
equal to the
amount of the then Outstanding Principal Balance divided by the
Conversion Price
or the adjusted share price conversion, if any, in compliance with
the terms
contained in Section 9 herein. Interest shall be paid in cash,
however; at the
sole election of the Holder, accrued interest may be converted into
Shares at
the same share price as the principal.
(b) Maker shall use its best efforts to effectuate a
registration
statement for all Shares that may be issued under this Note in
accordance with
the terms of a Registration Rights Agreement (the "Registration
Agreement")
executed as of the Effective Date.
10.
Anti-Dilution.
(a)
The Conversion Price for the Shares issued upon the conversion of
the
Outstanding Balance on this Note shall be protected by the
anti-dilution
provisions set forth in this Section 9, provided that such
anti-dilution shall
not apply with respect to: (a) Maker's grant of restricted stock to
employees or
directors (whether granted prior to or after the Effective Date)
pursuant to the
<PAGE>
terms and conditions of the Maker's 2000 Incentive Stock Option
Plan; (b) the
Maker's grant of stock options to employees or directors or the
exercise of
stock options (whether granted prior to or after the Effective
Date) by current,
future, or past employee's or directors of the Maker; (c) the
issuance of shares
for a consideration greater than Conversion Price in effect on the
date of, and
immediately prior to, such issue, or (d) an issuance of shares for
which the
Holder gives a written waiver of such adjustment.
(b)
Except as otherwise provided in this Section, in the event that
the
Maker shall at any time after the Effective Date, issue or sell any
shares of
Common Stock, including shares held in the Maker's treasury and
shares issued
upon the exercise of any options, rights or
