EXHIBIT 10.140
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES
ACT OF 1933 AND MAY NOT BE RESOLD OR HYPOTHECATED BY THE HOLDER
UNLESS SUCH
TRANSFER COMPLIES WITH AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF SAID
ACT. ACCEPTANCE OF THIS NOTE CONSISTUTES THE HOLDER'S
REPRESENTATION THAT THE
HOLDER TAKES THIS NOTE FOR INVESTMENT AND NOT WITH A VIEW TO RESALE
OR
DISTRIBUTION.
Note
No. 01
UNSECURED CONVERTIBLE
PROMISSORY NOTE
$1.00
April 1, 2003
Irvine, California
HiEnergy
Technologies, Inc., a Delaware corporation ("Maker"), for value
received, hereby promises to pay YOCCA, PATCH & YOCCA, LLP, a
California limited
liability partnership, or order ("Holder"), at 19900 MacArthur
Blvd., Suite 650,
Irvine, California 92612, or at such other place as designated in
writing by
Holder, the principal sum of One Dollars and No Cents ($1.00), with
interest
thereon at the rate of ten percent (10%) per annum on the then
outstanding
principal balance computed on the basis of a 365-day year and
charged on the
basis of actual days elapsed minus thirty (30) days. The
outstanding principal
balance, together with any and all accrued but unpaid interest
shall all be due
and payable in full on or before 5:00 p.m., California time,
September 15, 2003
(the "Maturity Date"). Interest shall accrue from and after the
date of this
Unsecured Convertible Promissory Note ("Note"), payable in full on
or before the
Maturity Date. All sums payable pursuant hereto shall be payable in
lawful money
of the United States of America. Payments made under this Note
shall be first
credited to fees or costs due under this Note, then to accrued
interest and
lastly to outstanding principal. Unpaid interest shall be added to
principal on
each anniversary of the date of this Note and bear like
interest.
TERMS AND CONDITIONS
<PAGE>
Section 1.
Prepayment. Maker may prepay this Note in whole or in part,
without penalty, at any time and from time to time upon thirty days
prior
written notice to Holder (the "Notice").
Section 2.
Default. If any of the following events (each hereinafter
called individually an "Event of Default") shall occur:
(a) If Maker shall default in the payment of any amount on this
Note
when the same shall become due and payable, whether at maturity or
by
acceleration or otherwise, or otherwise default under this Note;
or
(b) If Maker shall make an assignment for the benefit of
creditors;
or
(c) If Maker shall file a voluntary petition in bankruptcy, or
shall
be adjudicated a bankrupt or insolvent under the present or any
future Federal
Bankruptcy Act or other applicable federal, state or other statute,
law or
regulation; or
(d) In the event of a liquidation, dissolution or winding up of
the
Maker, whether voluntary or involuntary, or a sale, or a series of
related
sales, of all or substantially all of the assets of the Maker, or a
sale, or a
series of related sales, or exchange, of capital stock of the
Maker, either by
the Maker or its shareholders, such that the Maker's shareholders
immediately
before such transaction do not hold (by virtue of such shares or
securities
issued solely with respect thereto) more than fifty percent (50%)
of the voting
power of the surviving or continuing entity, or a merger,
consolidation,
acquisition of property or shares, separation or reorganization of
the Maker
with one or more entities, corporate or otherwise, as a result of
which the
Maker is not the surviving corporation or as a result of which the
holders of
stock of the Maker as of prior to the transaction do not hold (by
virtue of such
shares or securities issued solely with respect thereto) more than
fifty percent
(50%) of the voting power of the surviving or continuing entity;
or
then, and in each and every such case, the Holder of this Note may
by notice in
writing to the Maker declare all amounts under this Note to be
forthwith due and
payable (except that, in the case of an Event of Default under
either Section
2(b) or Section 2(c), this Note shall become immediately due and
payable without
notice) and thereupon the balance shall become so due and payable,
without
presentation, protest or further demand or notice of any kind, all
of which are
hereby expressly waived. The Maker shall give promptly a written
notice to
Holder of the occurrence or the approval by the Maker or its Board
of Directors
of any and all of the foregoing events, and in any of the events
under Section
2(d) or Section 2(e), such notice shall be given at least fifteen
(15) days
prior to the anticipated effective date of the transaction. In
addition, upon an
Event of Default, Holder may exercise any and all other rights and
remedies
Holder has at law, in equity or otherwise. All remedies are
cumulative. No
single or partial exercise of Holder of any right hereunder shall
preclude any
other or further exercise thereof or the exercise of any other
right.
2
<PAGE>
Section 3.
No Waiver. No waiver by Holder of any default of breach by
Maker under this Note shall be implied from any delay or omission
by Holder to
take action on account of such default if such default persists or
is repeated;
no express waiver shall affect any default other than the default
expressly made
the subject of the waiver and any such express waiver shall be
operative only
for the time and to the extent therein stated. Any waiver of any
covenant, term
or condition contained herein shall not be construed as a waiver of
any
subsequent breach of the same covenant, term or condition. The
consent or
approval by Holder to or of any act by Maker requiring further
consent or
approval shall not
