promnoteskyblueventures.htm


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    
      	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	
              US
      $6,500

            	 
      	
              September
      10, 2009

            


    

     

    PROMISSORY
NOTE

     

     

    FOR VALUE
RECEIVED, the undersigned, Ecology Coatings, Inc., a Nevada corporation (the
“The Maker”), promises to pay to the order of Sky Blue Ventures (the
“Holder”), the principal amount of Six Thousand Five Hundred dollars
($6,500), together with interest thereon as provided below.

     

     

    ARTICLE
I

     

     

    TERMS OF
REPAYMENT

     

    
      	
              1.

            	
              Interest.
      The Note shall bear interest (“Interest”) equal to five (5%) percent per
      annum on the unpaid principal balance, computed on a three hundred and
      sixty-five (365) day year, during the term of the Note. The Maker shall
      pay all Interest. In no event shall the rate of Interest payable on this
      Note exceed the maximum rate of interest permitted to be charged under
      applicable law.

            


    

     

    


     

    
      	
              2.

            	
              Payments.
      All payments by the Maker under this Note shall first be credited against
      costs and expenses provided for hereunder, second to the payment of any
      penalties, third to the payment of accrued and unpaid interest, if any,
      and the remainder shall be credited against principal. All payments due
      hereunder shall be payable in legal tender of the United States of
      America, and in same day funds delivered to the Holder by cashier’s check,
      certified check, or any other means of guaranteed funds to the mailing
      address provided below, or at such other place as the Holder or any holder
      hereof shall designate in writing for such purpose from time to time. If a
      payment hereunder otherwise would become due and payable on a Saturday,
      Sunday or legal holiday, the due date thereof shall be extended to the
      next succeeding business day, and Interest, if any, shall be payable
      thereon during such extension.

            


    

     

    


     

    
      	
              3.

            	
              Maturity
      Date. All of the outstanding principal and interest shall be payable
      within fifteen (15) days following receipt of a written payment demand
      from the Holder.

            


    

     

    


     

    
      	
              4.

            	
              Pre-Payment
      Demand. If the Maker completes an underwritten public offering of its
      common stock or other form of security convertible into common stock
      pursuant to an effective registration statement under the Securities Act
      of 1933 (the “Act”), as amended, or a managed private offering exempt from
      registration under Section 4(2) of the Act and Regulation D promulgated
      thereunder (collectively, a “New Offering”) which results in proceeds
      received by the Maker net of underwriting discounts and commissions, of at
      least One Million and 00/100 dollars ($1,000,000.00) (a “Pre-Payment
      Event”), then at the sole and absolute discretion of the Holder, and upon
      written demand to the Maker (the “Pre-Payment Notice”), all amounts owed
      under this Note shall become due and payable within fifteen (15) days
      following Maker’s receipt of the Pre-Payment
  Notice.

            


    

     

    


     

    
      	
              5.

            	
              Exemption
      from Restrictions. It is the intent of the Maker and the Holder in the
      execution of this Note that the indebtedness hereunder be exempt from the
      restrictions of the usury laws of any applicable jurisdiction. The Maker
      and the Holder agree that none of the terms and provisions contained
      herein shall be construed to create a contract for the use, forbearance or
      detention of money requiring payment of interest at a rate in excess of
      the maximum interest rate permitted to be charged by the laws of any
      applicable jurisdiction. In such event, if any holder of this Note shall
      collect monies which are deemed to constitute interest which would
      otherwise increase the effective interest rate on this Note to a rate in
      excess of the maximum rate permitted to be charged by the laws of any
      applicable jurisdiction, all such sums deemed to constitute interest in
      excess of such maximum rate shall, at the option of such holder, be
      credited to the payment of this principal amount due hereunder or returned
      to the Maker.

            


    

     

    ARTICLE
II

     

     

    COVENANTS

     

    
      	
              6.

            	
              Conversion
      into Common Stock. If the Maker completes a New Offering, the Maker shall
      give the Holder the option to convert this Note, in whole or in part, into
      Common Stock of the Maker based on a conversion price equal to the lower
      of: (a) the closing bid price per share of the Common Stock on the date
      first above written as reported on the Over-The-Counter Bulletin Board, or
      if there is not such price on the Effective Date, then the last bid price
      on the date nearest preceding the date first above written, or; (b) the
      average price at which the Maker sells its Common Stock in the New
      Offering (the “Conversion Price”)(the “Conversion
  Shares”).

            


    

     

    


     

    
      	
              7.

            	
              Piggyback
      Registration. If the Conversion Shares and the Underlying Shares
      (collectively, the “Shares”) have not been otherwise registered and at any
      time the Maker proposes to file a registration statement, whether or not
      for sale for the Maker’s own account, on a form and in a manner that would
      also permit registration of shares (other than in connection with a
      registration statement on Forms S-4 or S-8 or any similar or successor
      form) the Maker shall give to Holder, written notice of such proposed
      filing promptly, but in any case at least twenty (20) days before the
      anticipated filing. The notice referred to in the preceding sentence shall
      offer the holder(s) holding the Shares the opportunity to register such
      amount of the Shares as he may request (a “Piggyback Registration”).
      Subject to this Section, the Maker will include in each such Piggyback
      Registration (and any related qualification under state blue sky laws and
      other compliance filings, and in any underwriting involved therein) that
      portion of the Shares with respect to which the Maker has received written
      requests for inclusion therein within twenty (20) days after the written
      notice from the Maker is given. The holders holding any portion of the
      Shares will be permitted to withdraw all or part of the Shares from a
      Piggyback Registration at any time prior to the effective date of such
      Piggyback Registration. Notwithstanding the foregoing, the Maker will not
      be obligated to effect any registration of shares under this Paragraph 7
      as a result of the registration of any of its securities solely in
      connection with mergers effected pursuant to a Form S-4
      Filing.

            


    

     

    


     

    
      	
              8.

            	
              Covenants
      Regarding Registration

            


    

     

    


     

    
      	 
      	
              a.

            	 
      	
              The
      Maker shall use its best efforts to have any registration statement
      declared effective at the earliest possible time, and shall furnish such
      number of prospectuses as shall be reasonably required.

            
	 
      	
              b.

            	 
      	
              The
      Maker shall bear all costs, fees and expenses in connection with a
      Piggyback Registration,

            
	 
      	 
      	 
      	 
      
	 
      	
              c.

            	 
      	
              The
      Maker will take all necessary action which may be required in qualifying
      qualifying or registering the Shares included in any Piggyback
      Registration for offering and sale under the securities or blue sky laws
      of such states as are requested by the holders of such Shares, provided
      that the Maker shall not be obligated to execute or file any general
      consent to service or process or to qualify as a foreign corporation to do
      business under the laws of any such
  jurisdiction.

            


    

     

    


     

    
      	
              9.

            	
              Indemnification.
      The Maker shall, at The Maker’s expense, protect, defend, indemnify, save
      and hold Holder harmless against any and all claims, demands, losses,
      expenses, damages, causes of action (whether legal or equitable in nature)
      asserted by any person or entity arising out of, caused by or relating to
      the Note, including without limitation the construction of the Note and
      the use or application of the proceeds of the Note, and The Maker shall
      pay Holder upon demand all claims, judgments, damages, losses and expenses
      (including court costs and reasonable attorneys’ fees and expenses)
      incurred by Holder as a result of any legal or other action arising out of
      the Note as aforesaid.

            


    

     

    


     

    
      	
              10.

            	
              Attorneys
      Fees. The Maker shall reimburse Holder for all reasonable costs,
      attorney’s fees, and all other expenses in connection with this
      Note.

            


    

     

    


     

    
      	
              11.

            	
              Notice
      of Default. So long as any amount under this Note shall remain unpaid, the
      Holder will, unless the Maker otherwise consents in writing, promptly give
      written notice to the Maker in reasonable detail of the occurrence of any
      Event of Default, or any condition, event or act which with the giving of
      notice or the passage of time or both would constitute an Event of
      Default.

            


    

     

    ARTICLE
III

     

     

    DEFAULT

     

    
      	
              12.

            	
              Events
      of Default. Any of the following events shall constitute an “Event of
      Default” hereunder:

            


    

     

    


     

    
      	 
      	
              a.

            	 
      	
              Failure
      by the Maker to pay the principal or Interest, if any, of this Note when
      due and payable.

            
	 
      	 
      	 
      	 
      
	 
      	
              b.

            	 
      	
              The
      entry of an order for relief under Federal Bankruptcy Code as to the Maker
      or approving a petition in reorganization or other similar relief under
      bankruptcy or similar laws in the United States of America or any other
      competent jurisdiction, and if such order, if involuntary, is not
      satisfied or withdrawn within sixty (60) days after entry thereof; or the
      filing of a petition by the Maker seeking any of the foregoing,
      or

            
	 
      	 
      	 
      	
              consenting
      thereto; or the filing of a petition to take advantage of any debtor’s
      act; or making a general assignment for the benefit of creditors; or
      admitting in writing inability to pay debts as they mature;
    or

            
	 
      	 
      	 
      	 
      
	 
      	
              c.

            	 
      	
              Failure
      by the Maker to pay the principal and Interest, if any, of this Note
      concurrent with a Pre-Payment Event; or

            
	 
      	 
      	 
      	 
      
	 
      	
              d.

            	 
      	
              The
      breach of any covenant made by the Maker in this
  Note.

            


    

     

    


     

    
      	
              13.

            	
              Acceleration.
      Upon any Event of Default (in addition to any other rights or remedies
      provided for under this Note), at the option of the Holder or any holder
      hereof, all sums evidenced hereby, including all principal, accrued but
      unpaid Interest, fees and all other amounts due hereunder, shall become
      immediately due and payable. If an Event of Default relating to certain
      events of bankruptcy or insolvency of the Maker occurs and is continuing,
      the principal of and interest, if any, on this Note will become and be
      immediately due and payable without any declaration or other act on the
      part of the Holder or any holder hereof. This Note shall bear interest at
      the rate of ten (10%) percent per annum upon the occurrence of an Event of
      Default (“Default Interest”). Payments of the Default Interest shall be
      due every thirty (30) days following the occurrence Event of
      Default.

            


    

     

    


     

    
      	
              14.

            	
              No
      Waiver. Failure of the Holder or any holder hereof to exercise any option
      hereunder shall not constitute a waiver of the right to exercise the same
      in the event of any subsequent Event of Default, or in the event of
      continuance of any existing Event of Default after demand or performance
      thereof.

            


    

     

    


     

    
      	
              15.

            	
              Pursuit
      of any Remedy. The Holder or holder hereof may pursue any remedy under
      this Note without notice or presentment. The Holder or any holder hereof
      has the right to direct the time, method and place of conducting any
      proceeding for exercising any remedy available to the Holder or any such
      holder hereof under this Note.

            


    

     

    ARTICLE
IV

     

     

    MISCELLANEOUS

     

    
      	
              16.

            	
              Amendments.
      No amendment or waiver of any provision of this Note, nor consent to any
      departure by the Maker herefrom, shall in any event be effective unless
      the same shall be in writing and signed by the Holder, and then such
      waiver or consent shall be effective only in the specific instance and for
      the specific purpose for which
given.

            


    

     

    


     

    
      	
              17.

            	
              Notices.
      All notices and other communications provided for hereunder shall be in
      writing (including telecopier communication) and mailed, telecopied, or
      delivered, to the Maker or the Holder, as applicable, at their respective
      addresses specified on the signature pages hereof, or, as to each party,
      at such other address as shall be designated by such party in a written
      notice to the other party. All such notices and communications shall, when
      mailed or telecopied, be effective when deposited in the mails or
      telecopied with receipt confirmed,
respectively.

            


    

     

    


     

    
      	
              18.

            	
              No
      Waiver; Remedies. No failure on the part of the Holder to exercise, and no
      delay in exercising, any right hereunder shall operate as a waiver
      thereof, nor shall any single or partial exercise of any right hereunder
      preclude any other or further exercise thereof or the exercise of any
      other right. All rights, powers and remedies of the Holder in connection
      with this Note are cumulative and not exclusive, and shall be in addition
      to any other rights, powers or remedies provided by law or
      equity.

            


    

     

    


     

    
      	
              19.

            	
              Severability;
      Headings. If any one or more provisions of this Note shall be held to be
      illegal, invalid or otherwise unenforceable, the same shall not affect any
      other provisions of this Note and the remaining provisions of this Note
      shall remain in full force and effect. Article and paragraph headings in
      this Note are included herein for convenience of reference only and shall
      not constitute a part of this Note for any other purpose or be given any
      substantive effect.

            


    

     

    


     

    
      	
              20.

            	
              Binding
      Effect; Transfer. This Note shall be binding upon and inure to the benefit
      of the Maker and the Holder and their respective successors and assigns.
      The Holder may not assign or otherwise transfer, or grant participations
      in, this Note or all or any portion of its rights hereunder or its
      interest herein to any person or entity, without the prior written consent
      of the Maker which consent shall not be unreasonably withheld. The Maker
      may not assign or otherwise transfer its rights or obligations hereunder
      or any interest herein without the prior written consent of the Holder.
      Any attempted assignment by the Maker or the Holder in contravention of
      this paragraph shall be null and void and of no force or
      effect.

            


    

     

    


     

    
      	
              21.

            	
              Enforcement.
      It is agreed that time is of the essence of this Note and in the event of
      default of the terms of this Note, the Maker agrees to pay all costs of
      collection or enforcement, including reasonable attorneys’ fees and if
      there is a default in payment of any sum due
  hereunder.

            


    

     

    


     

    
      	
              22.

            	
              Governing
      Law. This Note shall be governed by, and shall be construed and enforced
      in accordance with, the internal laws of the State of Michigan without
      regard to conflicts of laws principles. The venue of any legal proceeding
      taken in connection with this Note will be in Pontiac,
      Michigan.

            


    

     

    


     

    
      	
              23.

            	
              Independence
      of Covenants. All covenants hereunder shall be given independent effect so
      that if a particular action or condition is not permitted by any of such
      covenants, the fact that it would be permitted by an exception to, or be
      otherwise within the limitations of, another covenant shall not avoid the
      occurrence of an Event of Default or event which with notice or lapse of
      time or both would become an Event of Default if such action is taken or
      condition exists.

            


    

     

    


     

    
      	
              24.

            	
              Interpretation.
      The Holder and the Maker hereby waive the benefit of any statute or rule
      of law or judicial decision which would otherwise require that the
      provisions of this Note be construed or interpreted more strongly against
      the party responsible for the drafting
thereof.

            


    

     

    


     

     

    IN
WITNESS WHEREOF, this Note has been issued as of date first written
above.

     

    
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
              MAKER:

            	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
              Ecology
      Coatings, Inc.

            	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
              /s/
      Robert G. Crockett

            	 
      	 
      
	 
      	 
      	
              Robert
      G. Crockett

            	 
      	 
      
	 
      	 
      	
              Chief
      Executive Officer

            	 
      	 
      


    

     

    


     

    
      	 
      	 
      	 
      
	
              Mailing
      Address of Holder:

            	 
      	 
      
	 
      	 
      	 
      
	
              Sky
      Blue Ventures

            	 
      	 
      
	
              2701
      Cambridge Court

            	 
      	 
      
	
              Suite
      425, Auburn Hills, MI 48326

            	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      


    

     

    Mailing
Address of Maker:

     

     

    Ecology
Coatings, Inc.

     

     

    2701
Cambridge Court

     

     

    Suite
100

     

     

    Auburn
Hills, MI 48326