Exhibit 10.3

 

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, TRANSFERRED, 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 AIRNET COMMUNICATIONS
CORPORATION THAT SUCH REGISTRATION IS NOT REQUIRED.

 

AMENDED AND RESTATED SECURED NON-CONVERTIBLE REVOLVING NOTE

 

FOR VALUE RECEIVED, each of AIRNET COMMUNICATIONS CORPORATION, a Delaware
corporation (the “Parent”), and the other companies listed on Exhibit A attached
hereto (such other companies together with the Parent, each a “Company” and
collectively, the “Companies”), jointly and severally, promises to pay to LAURUS
MASTER FUND, LTD., c/o 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 or its registered assigns or successors in interest (collectively,
the “Holder”), the sum of up to Seven Million Dollars ($7,000,000) or the
aggregate amount of outstanding Loans (as defined in the Security Agreement
referred to below), in each case without duplication of amounts owing by the
Companies to the Holder under the Minimum Borrowing Note (as defined in the
Security Agreement referred to below), together with any accrued and unpaid
interest hereon, on November 8, 2008 (the “Maturity Date”) if not sooner
indefeasibly paid in full hereunder. This note amends and restates in its
entirety (and is given in substitution for and not in satisfaction of that
certain $7,000,000 Secured Revolving Note made by the Company in favor of Holder
on November 8, 2005 and amended and restated as of December 30, 2005.

 

Capitalized terms used herein without definition shall have the meanings
ascribed to such terms in the Security Agreement among the Companies and the
Holder dated as of the date hereof (as amended, modified and/or supplemented
from time to time, the “Security Agreement”).

 

The following terms shall apply to this Secured Revolving Note (this “Note”):

 

ARTICLE I

CONTRACT RATE AND MINIMUM BORROWING NOTE

 

1.1 Contract Rate. Subject to Sections 2.2 and 3.9, interest payable on the
outstanding principal amount of this Note (the “Principal Amount”) shall accrue
at a rate per annum equal to the “prime rate” published in The Wall Street
Journal from time to time (the “Prime Rate”), plus two percent (2%) per annum
(the “Contract Rate”). The Contract 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

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effective as of the day of the change in the Prime Rate. The Contract Rate shall
not at any time be less than six percent (6%). Interest shall be (i) calculated
on the basis of a 360 day year, and (ii) payable monthly, in arrears, commencing
on December 1, 2005 on the first business day of each consecutive calendar month
thereafter through and including the Maturity Date (or any date of prepayment
permitted hereunder or under the Security Agreement), and on the Maturity Date
(or any date of prepayment permitted hereunder or under the Security Agreement),
whether by acceleration or otherwise.

 

1.2 Contract Rate Adjustments and Payments. The Contract Rate shall be
calculated on the last business day of each calendar month hereafter (other than
for increases or decreases in the Prime Rate which shall be calculated and
become effective in accordance with the terms of Section 1.1) until the Maturity
Date (each a “Determination Date”).

 

1.3 [Intentionally Deleted]

 

1.4 Repayment of Note. The Principal Amount of this Note shall be increased or
decreased from time to time to reflect Loans advanced and repaid in accordance
with the Security Agreement.

 

ARTICLE II

EVENTS OF DEFAULT AND DEFAULT RELATED PROVISIONS

 

2.1 Events of Default. The occurrence of an Event of Default under the Security
Agreement shall constitute an event of default (“Event of Default”) hereunder.

 

2.2 Default Interest. Following the occurrence and during the continuance of an
Event of Default, the Contract Rate on the outstanding principal balance of this
Note shall be one and one-half percent (1.5%) per month, and all outstanding
Obligations, including unpaid interest, shall continue to accrue interest at
such interest rate from the date of such Event of Default until the date such
Event of Default is cured or waived.

 

2.3 Default Payment. Following the occurrence and during the continuance of an
Event of Default, the Holder, at its option, may elect, in addition to all
rights and remedies of the Holder under the Security Agreement and the other
Ancillary Agreements and all obligations and liabilities of each Company under
the Security Agreement and the other Ancillary Agreements, to require the
Companies, jointly and severally, to make a Default Payment (“Default Payment”).
The Default Payment shall be (a) one hundred twelve percent (112%) of the
outstanding principal balance of the Note, plus (b) accrued but unpaid interest,
plus (c) all other fees then remaining unpaid, plus (d) all other amounts
payable hereunder. The Default Payment shall be applied first to any fees due
and payable to the Holder pursuant to the Notes, the Security Agreement and/or
the Ancillary Agreements, then to accrued and unpaid interest due on the Notes
and then to the outstanding principal balance of the Notes. The Default Payment
shall be due and payable immediately on the date that the Holder has exercised
its rights pursuant to this Section 3.3.

 

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ARTICLE III

MISCELLANEOUS

 

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

 

3.2 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.

 

3.3 Notices. Any notice herein required or permitted to be given shall be in
writing and shall be deemed effective given (a) upon personal delivery to the
party notified, (b) when sent by confirmed telex or facsimile if sent during
normal business hours of the recipient, if not, then on the next business day,
(c) five days after having been sent by registered or certified mail, return
receipt requested, postage prepaid, or (d) one day after deposit with a
nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to the
respective Company at the address provided for such Company in the Security
Agreement executed in connection herewith, and to the Holder at the address
provided in the Security Agreement for the Holder, with a copy to John E.
Tucker, Esq., 825 Third Avenue, 14th Floor, New York, New York 10022, facsimile
number (212) 541-4434, or at such other address as the respective Company or the
Holder may designate by ten days advance written notice to the other parties
hereto.

 

3.4 Amendment Provision. The term “Note” and all references 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 as such successor instrument may be amended or
supplemented.

 

3.5 Assignability. This Note shall be binding upon each Company and its
successors and assigns, and shall 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 Security Agreement. No Company may not assign any of its
obligations under this Note without the prior written consent of the Holder, any
such purported assignment without such consent being null and void. Nothing in
this Note shall be construed to give to any Person other than the Companies and
the Holder any legal or equitable right, or claim under this Note. This Note
shall be for the sole and exclusive benefit of the Companies and the Holder.

 

3.6 Cost of Collection. In case of any Event of Default under this Note, the
Companies shall, jointly and severally, pay the Holder the Holder’s reasonable
costs of collection, including reasonable attorneys’ fees.

 

3.7 Governing Law, Jurisdiction and Waiver of Jury Trial.

 

(a) THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAW.

 

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(b) EACH COMPANY HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS
LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK SHALL HAVE EXCLUSIVE
JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN ANY COMPANY,
ON THE ONE HAND, AND THE HOLDER, ON THE OTHER HAND, PERTAINING TO THIS NOTE, THE
SECURITY AGREEMENT OR ANY OF THE OTHER ANCILLARY AGREEMENTS OR TO ANY MATTER
ARISING OUT OF OR RELATED TO THIS NOTE, THE SECURITY AGREEMENT OR ANY OF THE
OTHER ANCILLARY AGREEMENTS PROVIDED, THAT EACH COMPANY ACKNOWLEDGES THAT ANY
APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF THE
COUNTY OF NEW YORK, STATE OF NEW YORK; AND FURTHER PROVIDED, THAT NOTHING IN
THIS NOTE SHALL BE DEEMED OR OPERATE TO PRECLUDE THE HOLDER FROM BRINGING SUIT
OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO COLLECT THE
OBLIGATIONS, TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE
OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE
HOLDER. EACH COMPANY EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH COMPANY
HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF PERSONAL
JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS. EACH COMPANY HEREBY WAIVES
PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH
ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT AND OTHER
PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE COMPANY AT
THE ADDRESS SET FORTH IN THE SECURITY AGREEMENT AND THAT SERVICE SO MADE SHALL
BE DEEMED COMPLETED UPON THE EARLIER OF THE COMPANY’S ACTUAL RECEIPT THEREOF OR
FIVE (5) DAYS AFTER BEING SENT BY CERTIFIED AND REGISTERED U.S. MAIL, PROPER
POSTAGE PREPAID

 

(c) EACH COMPANY DESIRES THAT ITS DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH
APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF
THE JUDICIAL SYSTEM AND OF ARBITRATION, EACH COMPANY HERETO WAIVES ALL RIGHTS TO
TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE,
WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE HOLDER, AND/OR ANY
COMPANY ARISING OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS NOTE, THE SECURITY
AGREEMENT, ANY OTHER ANCILLARY AGREEMENT OR THE TRANSACTIONS RELATED HERETO OR
THERETO.

 

3.8 Severability. 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 enforceability of any other provision of this Note.

 

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3.9 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 rate permitted
by such law, any payments in excess of such maximum rate shall be credited
against amounts owed by the Companies to the Holder and thus refunded to the
Companies.

 

3.10 Security Interest. The Holder has been granted a security interest in
certain assets of the Companies as more fully described in the Security
Agreement.

 

3.11 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 favor any party
against the other.

 

3.12 Registered Obligation. This Note is intended to be a registered obligation
within the meaning of Treasury Regulation Section 1.871-14(c)(1)(i) and the
Company (or its agent) shall register the Note (and thereafter shall maintain
such registration) as to both principal and any stated interest. Notwithstanding
any document, instrument or agreement relating to this Note to the contrary,
transfer of this Note (or the right to any payments of principal or stated
interest thereunder) may only be effected by (i) surrender of this Note and
either the reissuance by the Company of this Note to the new holder or the
issuance by the Company of a new instrument to the new holder, or (ii) transfer
through a book entry system maintained by the Company (or its agent), within the
meaning of Treasury Regulation Section 1.871-14(c)(1)(i)(B).

 

[Balance of page intentionally left blank; signature page follows]

 

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IN WITNESS WHEREOF, each Company has caused this Amended and Restated Secured
Non-Convertible Revolving Note to be signed in its name effective as of this 8th
day of November 2005.

 

AIRNET COMMUNICATIONS CORPORATION

By:

 

 

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Name:     Title:          

 

WITNESS:

 

 

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EXHIBIT A

 

OTHER COMPANIES

 

None.