Exhibit 10.1

 

Los Angeles, CA

September 7, 2006

FOR VALUE RECEIVED, INNOFONE.COM, INCORPORATED, a Nevada corporation (the “Company” or “Innofone”), hereby promises to pay to the order of Lawrence Hughes (the “Holder”), the principal sum of Two Million Dollars ($2,000,000) (the “Principal”) and interest accrued on that Principal per the terms set out below (collectively, the “Repayment Amount”). All amounts owing under this Note shall be paid in lawful money of the United States of America in immediately available funds.

 

Maturity Date. The Maturity Date shall be the earlier of: (a) sixty (60) days from the Closing Date (as defined hereunder); or (b) December 1, 2006, whichever is earlier or as otherwise mutually agreed by the parties in writing.

 

Closing Date. The Closing Date shall be the date on which the definitive documents are signed by the Company and the Holder and upon which the Principal amount is received by Company.

Repayment.

(a) Repayment of the Principal by Innofone to the Holder shall be made in full no later than the Maturity Date and may be made in one balloon payment on or before the Maturity Date, or monthly prior to the Maturity Date, at election of the Company.

 

(b) Innofone may, in its sole discretion, prepay any and all of the Repayment Amount owed at any time subsequent to payment of the Interest, in full or in part, without penalty.

Interest. Innofone shall pay to Holder interest at the rate of the London Interbank Offered Rate (LIBOR) plus one percent (1%) per annum simple interest on the full amount of the Principal calculated on the Closing Date and payable in full on the Closing Date along with the return of the Principal.

 

Fees. Each party shall be responsible for its fees and expenses incurred in connection with the documentation and closing of this transaction.

 

Attorneys Fees and Court Costs. If this Note shall be collected by legal proceedings or through any court or shall be referred to an attorney because of any default, Innofone agrees to pay all attorney’s fees, disbursements and court costs incurred by the Holder.

Security Interest. Junior in rank to that of Cogent Capital Financial, LLC’s and Cogent Capital Group, LLC’s and its affiliates security interest and securitization under the Swap and subject to any financing statement or security pledged in the Swap, the Note shall be secured by the assets of Innofone and its subsidiaries. Other lenders to the Company may be on parity with Holders under other obligations.

 

 

Event of Default. If any of the following events, acts or circumstances shall occur for any reason whatsoever (and whether such occurrence shall be voluntary or involuntary or come about or be affected by operation of law or otherwise) it shall be considered an Event of Default:

(a) Any failure of Innofone to make payment required under this Note; or

(b) Any failure of Innofone to pay the Principal in full by December 1, 2006.

Rights of Holder upon Default. Upon the occurrence and during the continuation of any Event of Default, immediately and without notice, all outstanding principal, interest, and fees payable by Innofone hereunder shall automatically become immediately due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, anything contained herein to the contrary notwithstanding.

 

Governing Law. This Note is being delivered in, is intended to be performed in, shall be construed and interpreted in accordance with, and be governed by the internal laws of the State of Nevada without regard to principles of conflict of laws.

 

No Presentment, Demand or Notice Required. Innofone waives presentment for payment, demand, notice of demand and of dishonor and nonpayment of this Note, protest and notice of protest, diligence in collecting, and the bringing of suit against any other party, and agrees to all renewals, extensions, modifications, partial payments, releases or substitutions of security, in whole or in part, with or without notice, before or after the date payment is demanded hereunder. Additionally, the undersigned's obligations hereunder shall be absolute and unconditional, and shall not be subject to any counterclaim, setoff, deduction or defense the undersigned may have.

 

Headings Descriptive. The headings of the several paragraphs and subparagraphs of this Note are inserted for convenience only and shall not in any way affect the meaning or construction of any provision of this Note.

 

IN WITNESS WHEREOF, Innofone has executed this Note as of the date first set forth above.

 

 

		Innofone.com, Incorporated
		By: /s/ Alex Lightman
		Alex Lightman, Chief Executive Officer and President