THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR ANY STATE SECURITIES LAWS. THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS
TO THIS NOTE UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO CREATIVE VISTAS, INC THAT SUCH
REGISTRATION IS NOT REQUIRED.
 
SECURED TERM NOTE
 
FOR VALUE RECEIVED, CREATIVE VISTAS, INC., an Arizona corporation (the
“Borrower”), hereby promises to pay to LAURUS MASTER FUND, LTD., M&C Corporate
Services Limited, P.O. Box 309 GT, Ugland House, South Church Street, George
Town, Grand Cayman, Cayman Islands, Fax: 345-949-8080 (the “Holder”) or its
registered assigns or successors in interest, on order, the sum of Eight Million
Two Hundred and Fifty Thousand Dollars in lawful money of the United
States (USD$8,250,000), together with any accrued and unpaid interest hereon, on
February 13, 2009 (the “Maturity Date”) if not sooner paid.
 
Capitalized terms used herein without definition shall have the meanings
ascribed to such terms in that certain Securities Purchase Agreement dated as of
the date hereof between the Borrower, Iview Holding Corp., Iview Digital Video
Solutions Inc. and the Holder (as amended, modified or supplemented from time to
time, the “Purchase Agreement”).
 
The following terms shall apply to this Note:
 
 
ARTICLE I
 
INTEREST & AMORTIZATION
 
1.1
Interest Rate. Subject to Sections 2.10 and 3.8 hereof, interest payable on the
outstanding principal amount of this Note shall accrue at a rate per annum (the
“Interest Rate”) equal to the “prime rate” published in The Wall Street Journal
from time to time, plus two percent (2.00%). The prime rate shall be increased
or decreased as the case may be for each increase or decrease in the prime rate
in an amount equal to such increase or decrease in the prime rate; each change
to be effective as of the day of the change in such rate. Subject to Section 1.1
hereof, the Interest Rate shall not be less than seven percent (7%) per annum]
Interest shall be calculated on the basis of a 360 day year. Interest shall
accrue but not be payable during the period commencing on February 13, 2006 and
ending on March 31, 2006 and shall be payable, in arrears, commencing on April
1, 2006 and on the first business day of each consecutive calendar month
thereafter (each, a “Repayment Date”) and on the Maturity Date, whether by
acceleration or otherwise. 

 
1.2
Currency. All principal, interest and other amounts owing under this Note, the
Purchase Agreement or any Related Agreement that, in accordance with their
terms, are paid in cash shall be paid in US dollars. All amounts denominated in
other currencies shall be converted in the US dollar equivalent amount in
accordance with the Exchange Rate on the date of calculation. “Exchange Rate”
means, in relation to any amount of currency to be converted into US dollars
pursuant to this Note, the US dollar exchange rate as published in the Wall
Street Journal on the relevant date of calculation.

 

--------------------------------------------------------------------------------

 
1.3
Taxes.

 

 
(a)
Any and all payments by the Borrower hereunder, including any amounts received
on redemption of the Note and any amounts on account of interest or deemed
interest, shall be made free and clear of and without deduction for any and all
present or future taxes, levies, imposts, deductions, charges or withholdings,
and all liabilities with respect thereto, excluding taxes imposed on net income
or franchise taxes of the Holder by the jurisdiction in which such person is
organized or has its principal office (all such non-excluded taxes, levies,
imposts, deductions, charges withholdings and liabilities, collectively or
individually, “Taxes”). If the Borrower shall be required to deduct any Taxes
from or in respect of any sum payable hereunder to the Holder, (i) the sum
payable shall be increased by the amount (an “additional amount”) necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section 1.3) the Holder shall receive an
amount equal to the sum it would have received had no such deductions been made,
(ii) the Borrower shall make such deductions and (iii) the Borrower shall pay
the full amount deducted to the relevant governmental authority in accordance
with applicable law.

 

 
(b)
In addition, Borrower agrees to pay to the relevant governmental authority in
accordance with applicable law any present or future stamp or documentary taxes
or any other excise or property taxes, charges or similar levies that arise from
any payment made hereunder or from the execution, delivery or registration of,
or otherwise with respect to, this Note (“Other Taxes”). The Borrower shall
deliver to the Holder official receipts, if any, in respect of any Taxes or
Other Taxes payable hereunder promptly after payment of such Taxes or Other
Taxes or other evidence of payment reasonably acceptable to the Holder.

 

 
(c)
The obligations of the Borrower under this Section 1.3 shall survive the
termination of this Note and the payment of the Note and all other amounts
payable hereunder.

 
1.4
Minimum Monthly Principal Amount. Amortizing payments of the aggregate principal
amount outstanding under this Note shall begin on March 1, 2007 and shall recur
on the first business day of each succeeding month thereafter until the Maturity
Date as set forth in the amortization schedule annexed hereto as Schedule A. On
the Maturity Date, all outstanding amounts of principal together with any
accrued and unpaid interest thereon, shall be due and payable.

 
1.5
Mandatory Redemption. The total outstanding Principal Amount together with any
accrued and unpaid interest and any and all other unpaid amounts which are then
owing by the Borrower to the Holder under this Note, the Purchase Agreement
and/or any other Related Agreement shall be due and payable on the Maturity
Date.

 
- 2 -

--------------------------------------------------------------------------------

 
1.6
Optional Redemption of Amortizing Principal Amount. The Borrower will have the
option of prepaying the outstanding Principal Amount (“Optional Redemption”), in
whole or in part, by paying to the Holder a sum of money equal to the Applicable
Principal Amount (as defined below) to be redeemed, together with accrued but
unpaid interest thereon and any and all other sums due, accrued or payable to
the Holder arising under this Note, the Purchase Agreement or any other Related
Agreement (the “Redemption Amount”) on the day written notice of redemption (the
“Notice of Redemption”) is given to the Holder. The Notice of Amortizing
Redemption shall specify the date for such Optional Redemption (the “Redemption
Payment Date”), which date shall be seven (7) business days after the date of
the Notice of Redemption (the “Redemption Period”). On the Redemption Payment
Date, the Redemption Amount shall be paid in good funds to the Holder. In the
event the Borrower fails to pay the Redemption Amount on the Redemption Payment
Date as set forth herein, then such Notice of Redemption will be null and void.
For the purposes of this Section 1.6, the “Applicable Principal Amount” shall
mean the outstanding Principal Amount to be repaid (to a maximum of 40% of the
original Principal Amount when aggregated with all optional prepayments of
outstanding Principal Amount made in accordance with this provision from time to
time during the term of this Note) and 105% of the outstanding Principal Amount
to be repaid in accordance with this provision in excess of 40% of the original
Principal Amount. In the event of an optional prepayment made in accordance with
this provision, the Borrower shall be entitled to require all or any portion of
the Principal Amount repaid (but not any premium forming part of the Applicable
Principal Amount) to be applied in satisfaction of all or any portion of one or
more monthly amortization payments required to be made in accordance with
Section 1.4 of this Note.

 
 
ARTICLE II
EVENTS OF DEFAULT
 
Upon the occurrence and continuance of an Event of Default beyond any applicable
grace period, the Holder may make all sums of principal, interest and other fees
then remaining unpaid hereon and all other amounts payable hereunder immediately
due and payable. In the event of such an acceleration, the amount due and owing
to the Holder shall be 120% of the outstanding principal amount of the Note
(plus accrued and unpaid interest and fees, if any) (the “Default Payment”). The
Default Payment shall be applied first to any fees due and payable to Holder
pursuant to this Note, the Purchase Agreement or the Related Agreements, then to
accrued and unpaid interest due on the Note and then to outstanding principal
balance of the Note.
 
The occurrence of any of the following events set forth in Sections 2.1 through
2.9, inclusive, is an “Event of Default”:
 
2.1
Failure to Pay Principal, Interest or other Fees. The Borrower fails to pay when
due any instalment of principal, interest or other fees hereon in accordance
herewith, or the Borrower fails to pay when due any amount due under any other
promissory note issued by Borrower, and in any such case, such failure shall
continue for a period of three (3) days following the date upon which any such
payment was due.

 
2.2
Breach of Covenant. The Borrower breaches any covenant or any other term or
condition of this Note or the Purchase Agreement in any material respect, or the
Borrower or any of its Subsidiaries breaches any covenant or any other term or
condition of any Related Agreement in any material respect and, any such case,
such breach, if subject to cure, continues for a period of fifteen (15) days
after the occurrence thereof.

 
2.3
Breach of Representations and Warranties. Any representation or warranty made by
the Borrower in this Note or the Purchase Agreement, or by the Borrower or any
of its Subsidiaries in any Related Agreement, shall, in any such case, be false
or misleading in any material respect on the date that such representation or
warranty was made or deemed made.

 
- 3 -

--------------------------------------------------------------------------------

 
2.4
Receiver or Trustee. The Borrower or any of its Subsidiaries shall make an
assignment for the benefit of creditors, or apply for or consent to the
appointment of a receiver or trustee for it or for a substantial part of its
property or business; or such a receiver or trustee shall otherwise be
appointed.

 
2.5
Judgments. Any money judgment, writ or similar final process shall be entered or
filed against the Borrower or any of its Subsidiaries or any of their respective
property or other assets for more than USD$250,000, and shall remain unvacated,
unbonded or unstayed for a period of sixty days.

 
2.6
Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation proceedings or
other proceedings or relief under any bankruptcy law or any law for the relief
of debtors shall be instituted (i) by the Borrower or any of its Subsidiaries or
(ii) against the Borrower or any of its Subsidiaries and, solely in the case of
this clause (ii), remains undismissed for a period of 60 days.

 
2.7
Failure to Deliver Replacement Note. The Borrower shall fail to deliver a
replacement Note to Holder within seven (7) business days following the required
date of such issuance pursuant to this Note, the Purchase Agreement or any
Related Agreement (to the extent required under such agreements).

 
2.8
Default Under Related Agreements or Other Agreements. The occurrence and
continuance of (i) any Event of Default (as defined in the Purchase Agreement or
any Related Agreement), (ii) any Event of Default under and as defined in any of
(x) that certain Secured Term Note issued by Cancable Inc. (“Cancable”) to the
Holder, dated December 31, 2005 (as amended, modified or supplemented from time
to time, the “2005 Term Note”), (x) the Purchase Agreement referred to in the
2005 Term Note (as amended, modified or supplemented from time to time, the
“2005 Purchase Agreement”) and/or (y) any Related Agreement referred to in the
2005 Purchase Agreement (as each may be amended, modified or supplemented from
time to time and/or (iii) any event of default (or similar term) under any other
indebtedness.

 
2.9
Change in Control.

 

 
(a)
(i) Any person or company (other than the Holder) or any person or company
acting jointly or in concert with any person or company (other than the Holder)
is or becomes the “beneficial owner” (as defined in Rules 13(d)-3 and 13(d)-5
under the Exchange Act), directly or indirectly, of 35% or more on a fully
diluted basis of the then outstanding voting equity interest of the Borrower or
(ii) the Board of Directors of the Borrower shall cease to consist of a majority
of the Board of Directors of the Borrower on the date hereof (or directors
appointed by a majority of the Board of Directors in effect immediately prior to
such appointment).

 

 
(b)
(i) Any person or company (other than the Holder) or any person or company
acting jointly or in concert with any person or company (other than the Holder)
is or becomes the “beneficial owner” (as defined in Rules 13(d)-3 and 13(d)-5
under the Exchange Act), directly or indirectly, of 35% or more on a fully
diluted basis of the then outstanding voting equity interest of Iview Holding
Corp. or (ii) the Board of Directors of the Iview Holding Corp. shall cease to
consist of a majority of the Board of Directors of Iview Holding Corp on the
date hereof (or directors appointed by a majority of the Board of Directors in
effect immediately prior to such appointment).

 
- 4 -

--------------------------------------------------------------------------------

 
2.10
Default Interest Rate. Following the occurrence and during the continuance of an
Event of Default and following the expiration of all applicable notice and cure
periods related thereto, the Borrower shall pay additional interest on this Note
on a monthly basis in an amount equal to eighteen (18%) per annum, and all
outstanding obligations under this Note, including unpaid interest, shall
continue to accrue such additional interest from the date of such Event of
Default until the date such Event of Default is cured or waived. 

 
2.11
Cumulative Remedies. The remedies under this Note shall be cumulative.

 
 
ARTICLE III
MISCELLANEOUS
 
3.1
Failure or Indulgence Not Waiver. No failure or delay on the part of the Holder
hereof in the exercise of any power, right or privilege hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise of any such power,
right or privilege preclude other or further exercise thereof or of any other
right, power or privilege. All rights and remedies existing hereunder are
cumulative to, and not exclusive of, any rights or remedies otherwise available.

 
3.2
Notices. Any notice herein required or permitted to be given shall be in writing
and provided in accordance with the terms of the Purchase Agreement.

 
3.3
Amendment Provision. The term “Note” and all reference thereto, as used
throughout this instrument, shall mean this instrument as originally executed,
or if later amended or supplemented, then as so amended or supplemented, and any
successor instrument issued pursuant to Section 3.4 hereof, as it may be amended
or supplemented.

 
3.4
Assignability. This Note shall be binding upon the Borrower and its successors
and assigns, and shall be binding upon and inure to the benefit of the Holder
and its successors and assigns, and may be assigned by the Holder in accordance
with the requirements of the Purchase Agreement. This Note shall not be assigned
by the Borrower without the consent of the Holder.

 
3.5
Governing Law. This Note shall be governed by and construed in accordance with
the laws of the State of New York, without regard to principles of conflicts of
laws. Any action brought by either party against the other concerning the
transactions contemplated by this Agreement shall be brought only in the state
courts of New York or in the federal courts located in the state of New York.
Both parties to this Note agree to submit to the jurisdiction of such courts.
The prevailing party shall be entitled to recover from the other party its
reasonable attorney’s fees and costs. In the event that any provision of this
Note is invalid or unenforceable under any applicable statute or rule of law,
then such provision shall be deemed inoperative to the extent that it may
conflict therewith and shall be deemed modified to conform with such statute or
rule of law. Any such provision which may prove invalid or unenforceable under
any law shall not affect the validity or unenforceability of any other provision
of this Note. Nothing contained herein shall be deemed or operate to preclude
the Holder from bringing suit or taking other legal action against the Borrower
in any other jurisdiction to collect on the Borrower’s obligations to Holder, to
realize on any collateral or any other security for such obligations, or to
enforce a judgment or other court in favour of the Holder.

 
- 5 -

--------------------------------------------------------------------------------

 
3.6
Maximum Payments. Nothing contained herein shall be deemed to establish or
require the payment of a rate of interest or other charges in excess of the
maximum permitted by applicable law. In the event that the rate of interest
required to be paid or other charges hereunder exceed the maximum permitted by
such law, any payments in excess of such maximum shall be credited against
amounts owed by the Borrower to the Holder and thus refunded to the Borrower.

 
3.7
Security Interest and Guarantee. The Holder has been granted a security
interest in certain assets of the Borrower and its affiliates as more fully
described in certain Related Agreements (as defined in the Purchase Agreement
and the 2005 Purchase Agreement). The obligations of the Borrower under this
Note are guaranteed by certain affiliates of the Borrower pursuant the Amended
and Restated Guaranty dated as of the date hereof granted by Iview Digital Video
Solutions Inc., Cancable, Cancable Holding Corp., Cancable, Inc., Iview Holding
Corp., Borrower, Creative Vistas Acquisition Corp., and A.C. Technical Systems
Ltd. and the Amended and Restated Guaranty dated as of the date hereof granted
by Brent W. Swanick.

 
3.8
Construction. Each party acknowledges that its legal counsel participated in the
preparation of this Note and, therefore, stipulates that the rule of
construction that ambiguities are to be resolved against the drafting party
shall not be applied in the interpretation of this Note to favour any party
against the other. 

 
3.9
Cost of Collection. If default is made in the payment of this Note, the Borrower
shall pay to Holder reasonable costs of collection, including reasonable
attorney’s fees.

 
 
- 6 -

--------------------------------------------------------------------------------

 
IN WITNESS WHEREOF, the Borrower has caused this Note to be signed in its name
effective as of this 13th day of February, 2006.
 

   
CREATIVE VISTAS, INC. (Arizona)
 
   
By:
/s/ DOMINIC BURNS
     
Name: Dominic Burns
Title: President

 
ACKNOWLEDGED BY:
 

   
IVIEW DIGITAL VIDEO SOLUTIONS INC. (Canada)
 
   
By:
/s/ SAYAN NAVARATNAM
     
Name: Sayan Navaratnam
Title: President

 

   
IVIEW HOLDING CORP. (Delaware)
 
   
By:
/s/ DOMINIC BURNS
     
Name: Dominic Burns
Title: President

 
 

   
CANCABLE INC. (Ontario)
 
   
By:
/s/ HEUNG HUNG LEE
     
Name: Heung Hung Lee
Title: Secretary

 

   
CANCABLE HOLDING CORP. (Delaware)
 
   
By:
/s/ DOMINIC BURNS
     
Name: Dominic Burns
Title: President

 
- 7 -

--------------------------------------------------------------------------------

 

   
CANCABLE, INC. (Nevada)
 
   
By:
/s/ ROSS JEPSON
     
Name: Ross Jepson
Title: President and Secretary

 

   
CREATIVE VISTAS ACQUISITION CORP. (Ontario)
 
   
By:
/s/ SAYAN NAVARATNAM
     
Name: Sayan Navaratnam
Title: President and Secretary

 

   
A.C. TECHNICAL SYSTEMS LTD. (Ontario)
 
   
By:
/s/ DOMINIC BURNS
     
Name: Dominic Burns
Title: President and Secretary
         

 
- 8 -

--------------------------------------------------------------------------------

 
SCHEDULE “A”
 
AMORTIZATION SCHEDULE
 
Months
 
Monthly Amortization
     
March 2007 - February 2009
 
USD$137,500
     
Maturity Date
 
USD$4,950,000

 

--------------------------------------------------------------------------------