THE SALE AND ISSUANCE OF THIS NOTE HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION. THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT AND NOT
WITH A VIEW TO, OR IN CONNECTION WITH, THE DISTRIBUTION THEREOF AND
MAY NOT BE OFFERED, SOLD, ASSIGNED, TRANSFERRED OR OTHERWISE
DISPOSED OF UNLESS (I) A REGISTRATION STATEMENT UNDER THE ACT IS IN
EFFECT AS TO THIS NOTE AND SUCH DISPOSITION IS IN COMPLIANCE WITH
APPLICABLE SECURITIES LAW OF ANY STATE OR OTHER JURISDICTION OR
(II) THERE IS AN OPINION OF COUNSEL OR OTHER EVIDENCE, IN EITHER
CASE, SATISFACTORY TO THE COMPANY, THAT AN EXEMPTION THEREFROM IS
AVAILABLE AND THAT SUCH DISPOSITION IS IN COMPLIANCE WITH
APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION.
HELIX WIND, CORP.
SECURED PROMISSORY
NOTE
|
[Closing
Date]
|
____ Dollars
|
HELIX WIND, CORP., a Nevada corporation
(together with its successors and assigns, “Issuer”),
for value received, hereby promises to pay to Fiber-Tech Products
GmbH, Weser Anlagentechnik Beteiligungs GmbH and CLANA Power
Systems GmbH (collectively, the “Noteholder”) and its
registered successors, transferees and assigns, by wire transfer of
immediately available funds to an account designated by Noteholder
by written notice to Issuer, the original principal sum of
_________ Dollars (the “Principal Amount”), or, if
less, the aggregate unpaid principal amount outstanding when due,
upon any Installment Date with respect to the Installment Amount
(each, as defined herein) due on such Installment Date,
acceleration or otherwise (in each case in accordance with the
terms hereof), together with interest as provided below. All such
payments shall be made in U.S. Dollars
This Note (this “Note”) is made and
issued by the Issuer pursuant to the terms of that certain Stock
Purchase Agreement dated September 2, 2009 (“Purchase
Agreement”), between the Issuer, the
Noteholder, Venco Power Gmbh and the
Principals as listed and identified therein. Capitalized
terms used but not defined herein shall have the meanings ascribed
to them in the Purchase Agreement.
Issuer shall keep at its principal office a
register (the “Register”) in which shall be entered the
name and address of the registered holder of this
Note. References to the “Holder” shall mean
the Person listed in the Register as the payee of the
Note. The ownership of this Note shall be proven by the
Register. For the purpose of paying principal and any
interest on this Note, Issuer shall be entitled to rely on the name
and address in the Register and notwithstanding anything to the
contrary contained in this Note, no Event of Default shall occur
under Section 3(a) or 3(b) if payment of principal and any interest
is made in accordance with the name and address contained in the
Register.
1.
Certain Definitions . The following terms (except as
otherwise expressly provided) for all purposes of this Note shall
have the respective meanings specified below. The terms
defined in this Section 1 include the plural as well as the
singular.
“ Bankruptcy Law ” means
Title 11, U.S. Code or any similar federal or state law for the
relief of debtors.
“ Business Day ” means any
day except a Saturday, Sunday or any other day on which commercial
banks in the State of California are authorized by law to
close. Whenever any payment or other obligation
hereunder shall be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business
Day.
“ Custodian ” means any
receiver, trustee, assignee, liquidator or similar official under
any Bankruptcy Law.
“ Default ” means any
condition or event which constitutes an Event of Default or which
with the giving of notice or lapse of time or both would, unless
cured or waived, become an Event of Default.
“ First Installment Amount ”
means the amount of __________ Dollars.
“ First Installment Date ”
means _____, 2010 [the date that is twelve (12) months from the
date hereof].
“ Person ” means an
individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization or a governmental entity
(or any department, agency or political subdivision
thereof).
“
Second Installment Amount ” means the amount of
_________ Dollars.
“ Second Installment Date ”
means ____, 2011 [the date that is twenty-four (24) months from the
date hereof], and together with the First Installment Date,
“Installment Dates”.
2.
Principal and Interest .
(a)
Interest . The aggregate outstanding Principal
Amount of this Note shall bear interest accruing from the date
hereof until the date this Note shall have been repaid in full at
the Prime Rate plus 1%__ percent per annum. Prime Rate shall mean
the prime rate of interest as reported in the Wall Street Journal
for the Business Day immediately preceding the earlier of any
applicable Installment Date, or any date upon which all or any
portion of the Principal Amount may be prepaid as permitted herein.
All computations of interest payable hereunder shall be on the
basis of a 365-day year and actual days elapsed in the period for
which such interest is payable. On each Installment
Date, Issuer shall pay to Noteholder an amount equal to the
Installment Amount due on such Installment Date, together with
accrued and unpaid interest thereon.
(b)
Prepayment . The hereunder and all interest
accrued thereon may be prepaid by the Issuer, at any time and
without penalty or premium.
(c)
Reductions and Conditions to Installment Payments
.
(i) The
First Installment Amount shall be reduced by the amount that the
Damages calculated by Issuer pursuant to Section 10.1 of the
Purchase Agreement exceeds the Closing Date Liabilities,
provided , however , that the amount of such
reduction shall not be greater than 40,000.00 Euros.
(ii) The
Second Installment Amount shall only be due and payable by the
Issuer if each of the following events shall have occurred on or
prior to the Second Installment Date:
(a) the Intellectual Property shall have been
duly transferred to Issuer, and none of the Noteholders shall have
any right, title or interest to any of the Intellectual Property,
including without limitation, the reasonable assistance from Dr.
Matthias Pfalz and Reinhard Caliebe in the filing in the United
States of America of the contemplated patents for the 50kw unit
Vertikon 50, also known as D15000;
(b) Dr. Matthias Pfalz shall have utilized his
non-financial support and assistance, to the extent reasonable as a
consultant to Issuer, in establishing a manufacturing facility
either in Germany, Thailand, China or the U.S and by a supplier,
the location and supplier to be determined in the sole discretion
of and at the sole cost of Issuer, provided that , the
failure of any such manufacturing facility or supplier to be
established for any reason, notwithstanding the required support
and assistance of the individuals named above, shall not
be or constitute a basis for the non-payment of the Second
Installment by Issuer;
(c) there being no breach or default, or
threatened breach or default, by Reinhard Caliebe or Andreas
Görke of any term, provision, covenant, representation or
warranty under their respective Employment Agreements which would
cause either Employment Agreement not to be in full force and
effect on the Second Installment Date; and
(d) there being no breach or default, or
threatened breach or default, by Matthias Pfalz of any term,
provision, covenant, representation or warranty under his
Consulting Agreement which would cause the Consulting Agreement not
to be in full force and effect on the Second Installment
Date.
3.
Events of Default and Remedies . In case one or
more of the followi
