**Exhibit 10.21**

** **

**UNIVERSAL ACCESS GLOBAL HOLDINGS INC.(a Delaware corporation)CONVERTIBLE PROMISSORY NOTE(the “Note”)**

** **

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS.  THESE SECURITIES HAVE BEEN ACQUIRED SOLELYFOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE ORDISTRIBUTION THEREOF.  THEY MAY NOT BESOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED OR OTHERWISE DISTRIBUTED IN THEABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT WITH RESPECT TO THESE SECURITIESUNDER THE SECURITIES ACT OF 1993, AS AMENDED, AND APPLICABLE STATE LAWS OR ANOPINION OF COUNSEL SATISFACTORY IN FORM AND SUBSTANCE TO THE COMPANY THAT SUCHREGISTRATION IS NOT REQUIRED UNDER SUCH ACT AND APPLICABLE LAWS.

 
| $1,000,000 |   | April 28, 2004 |
|------------|--------|----------------|

 

FOR VALUE RECEIVED, Universal Access Global H Inc., a corporationorganized under the laws of the State of Delaware (the “**Company**”), promises to pay to the order ofLafayette Business Park, LLC (the “**Holder**”),the principal sum of One Million Dollars ($1,000,000), in legal and lawfulmoney of the United States of America. Payment for all amounts due hereundershall be made at the principal office of Holder at the address of Holder setforth below, or such other address as the Holder may hereafter direct inwriting.

 

This Convertible Promissory Note is being delivered to Holder inconnection with the execution by the Company and Holder of that Agreement (the“**Agreement**”)dated of even date herewith relating to the termination of the lease datedApril 1, 1999 by and between Holder and the Company’s wholly-owned subsidiary,Universal Access, Inc., for the property commonly known as 1900 LafayetteStreet, Santa Clara, California and the lease dated August 31, 1999 by andbetween Holder and Universal Access, Inc. for the property commonly known as1940 Lafayette Street, Santa Clara, California.

 

The following is a statement of the rights of the Holder of this Noteand the conditions to which this Note is subject, and to which the Holderhereof, by the acceptance of this Note agrees:

 

# 1.             Interest/DebtService.  Except as provided in Section3.1 below, this Note shall be non-interest bearing. Unless this Note isprepaid or converted as provided herein, the unpaid principal amount of thisNote shall be due and payable in one lump sum on the second anniversary of thedate first set forth above (the “**MaturityDate**”).

 

# 2.             Eventsof Default.  The occurrence of anyof the following events shall constitute an event of default under the Note (an“**Event ofDefault**”):

 

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## 2.1           Failureto Pay.  The Company shall fail topay the principal due on the Maturity Date as required under the terms of thisNote and such default shall continue for a period of more than five (5)business days after notice thereof to the Company.

 

## 2.2           VoluntaryBankruptcy or Insolvency Proceedings. The Company shall (i) apply foror consent to the appointment of a receiver, trustee, liquidator or custodianof itself or of all or a substantial part of its property, (ii) be unable, oradmit in writing its inability, to pay its debts generally as they mature,(iii) make a general assignment for the benefit of its creditors, (iv) bedissolved or liquidated in full or in part, or (v) commence a voluntary case orother proceeding seeking liquidation, reorganization or other relief withrespect to itself or its debts under any bankruptcy, insolvency or othersimilar law now or hereafter in effect or consent to any such relief or to theappointment of or taking possession of its property by any official in aninvoluntary case or other proceeding commenced against it.

 

## 2.3           InvoluntaryBankruptcy or Insolvency Proceedings. Proceedings for the appointment of a receiver, trustee, liquidator orcustodian of the Company of all or a substantial part of the property thereof,or an involuntary case or other proceedings seeking liquidation, reorganizationor other relief with respect to the Company or the debts thereof under anybankruptcy, insolvency or other similar law now or hereafter in effect shall becommenced and an order for relief entered or such proceeding shall not bedismissed, discharged or stayed within ninety (90) days of commencement, or anyaction under the laws of the state of the Company’s organization analogous toany of the foregoing shall be taken with respect to the Company and shallcontinue undismissed, or unstayed and in effect, for a period of ninety (90)days.

 

# 3.             Remedies.

 

## 3.1           DefaultInterest. From and after the occurrence of an Event of Default, whichremains uncured after the expiration of any applicable cure period, then fromthe date of any such default and during the continuance thereof, this Noteshall bear interest at the default rate (hereafter the “**Default Rate**”) of ten percent(10%) per annum. This Note shall continue to bear interest at the Default Rateuntil such time as the default shall have been fully cured.

 

## 3.2           Acceleration.  Upon the occurrence of an Event of Defaultreferred to above, the principal amount then outstanding under this Note shall,upon notice to the Company by Holder, be paid in cash immediately to the Holderwithin a period not exceeding seven (7) days from the date of notice withoutother or further presentment, demand, protest or other formalities of any kind,all of which are hereby expressly waived by the Company.

 

## 3.3           CumulativeRemedies. Holder may institute such actions or proceedings in law or equityas it shall deem expedient for the protection of its rights and may prosecuteand enforce its claims against all assets of the Company, and in connectionwith any such action or proceeding shall be entitled to receive from theCompany payment of the principal amount and interest, if any, of this Note plusreasonable expenses of collection, including, without limitation, attorneys’fees and expenses.  No remedy hereinconferred upon the holder of this Note is intended to be exclusive of any otherremedy, and each and every such remedy shall be cumulative and shall be inaddition to every other remedy given hereunder or now or hereafter existing atlaw or in equity or by statute or otherwise.

 

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# 4.             Waivers.  Unless otherwise specifically set forth inthis Note, the Company and each surety, endorser, guarantor and other personliable upon this Note waives (i) all notices, demands and presentments for payments, and (ii) all notices ofnon-payment, default, intention to accelerate maturity, acceleration ofmaturity, protest and dishonor.

 

# 5.             Prepayment.The Company shall have the right to prepay all or any part of the outstandingprincipal balance of this Note, at any time upon providing ten (10) businessdays’ prior notice to the Holder, by wire transfer or delivery of good funds toHolder.

 

# 6.             ConversionRights.

 

## 6.1           VoluntaryConversion.  The Holder of this Notehas the right, at the Holder’s option, at any time, to convert this Note inaccordance with the provisions of Section 6.2 hereof, in whole or inpart, into fully paid and nonassessable shares of common stock of the Company(the “**Common Stock**”).  The number of shares of Common Stock of theCompany into which this Note may be converted (“**Conversion Shares**”) shall be determined by dividing theoutstanding principal and interest, if any, elected by the Holder to be converted,by the Conversion Price (as defined below) in effect at the time of suchconversion.  The “**Conversion Price**” shall beequal to $2.50, subject to adjustment as provided in Section 7 below.

 

## 6.2           ConversionProcedure.  The Holder may convertthis Note as provided in Section 6.1 by delivering to the Company aNotice of Exercise (attached hereto) and surrendering this Note, duly endorsed,to the Company at its principal corporate office. The Company shall, as soon aspracticable, thereafter, and at its expense, issue and deliver at such officeto the Holder of this Note a certificate or certificates representing theConversion Shares and, to the extent the Notice of Exercise specifies aconversion of this Note in part and not in whole, the Company shall deliver toHolder a replacement convertible promissory note (in form and substance similarto this Note) for the amount of principal and interest, if any, that remainsoutstanding after giving effect to the conversion of the principal andinterest, if any, specified in the Notice of Exercise (a “**Replacement Note**”).  Holder acknowledges that the certificatesfor the Conversion Shares and Replacement Note, if any, will be legended, ifand as required by applicable state and federal securities laws.  Such conversion shall be deemed to have beenmade on the date of the Company’s receipt of the Notice of Exercise, and theperson or persons entitled to receive the Conversion Shares shall be treatedfor all purposes as the record holder or holders of such Conversion Shares asof such date.

 

## 6.3           AutomaticConversion. Upon the occurrence of a Change in Control Event (definedbelow) that will result in the shareholders of the Company being entitled toreceive compensation (whether payable in cash, property or a combinationthereof) having a fair market value equal to or greater than $3.00 per share,subject to adjustment as provided in Section 7.3 (the “**Per SharePrice**”), then the outstanding principal and interest, if any, ofthis Note shall convert automatically into Conversion Shares at the ConversionPrice. Such conversion shall be deemed to occur immediately prior to theclosing of the Change in Control Event and the Holder shall be treated for allpurposes as the record holder or holders of such Conversion Shares as of suchdate. A “Change in Control Event” shall mean: (1) the consummation of a mergeror consolidation of the Company; or (2) an agreement for the sale ordisposition by the Company of

 

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## all orsubstantially all of the Company’s assets; or (3) the liquidation, dissolutionor winding up of the Company.

 

## 6.4           Mechanicsand Effect of Conversion.  Nofractional Conversion Shares shall be issued upon conversion of this Note.  In lieu of the Company’s issuing any fractionalshares to the Holder upon the conversion of this Note, the Company shall pay tothe Holder cash in the amount of such fractional amount. Upon full conversionof the Note, the Company shall deliver (i) stock certificates representingownership of the Conversion Shares, and (ii) a check payable to the Holder forany fractional amount. Upon full conversion of this Note and timely performanceby the Company of its obligations related to such conversion, the Company shallbe forever released from all of its obligation and liabilities under this Note.

 

# 7.             Adjustmentsto Conversion Price.

 

## 7.1           Mergeror Consolidation. If at any time there shall be a merger or a consolidationof the Company with or into another corporation when the Company is not thesurviving corporation (other than a merger or consolidation that results in anautomatic conversion as described in Section 6.3), then, as part of suchmerger or consolidation, lawful provision shall be made so that the Holder, asthe holder of this Note, shall thereafter be entitled to receive uponconversion of this Note, during the period specified herein and upon payment ofthe aggregate Conversion Price then in effect, the number of shares of stock orother securities or property (including cash) of the successor corporationresulting from such merger or consolidation, to which the Holder as the holderof the Conversion Shares deliverable upon conversion of this Note would havebeen entitled in such merger or consolidation if this Note had been exercised immediatelybefore such merger or consolidation.  Inany such case, appropriate adjustment shall be made in the application of theprovisions of this Note with respect to the rights and interests of the Holderas the holder of this Note after the merger or consolidation.  This provision shall apply to successivemergers or consolidations.

 

## 7.2           Reclassification,Recapitalization, etc.  If theCompany at any time shall, by reclassification of securities, recapitalization,automatic conversion, or other similar event affecting the number or characterof outstanding shares of Common Stock, or otherwise, change any of thesecurities as to which purchase rights under this Note exist into the same or adifferent number of securities of any other class or classes, this Note shallthereafter represent the right to acquire such number and kind of securities aswould have been issuable as the result of such change with respect to thesecurities that were subject to the conversion rights under this Noteimmediately prior to such subdivision, combination, reclassification or otherchange.

 

## 7.3           Split,Subdivision or Combination of Common Stock.  If the Company, at any time while this Note remains outstanding,shall split, subdivide or combine the securities as to which conversion rightsunder this Note exist, the Conversion Price and Per Share Price shall beproportionately increased or decreased as appropriate to adjust for the split,subdivision or combination.

 

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# 8.             RegistrationRights.

 

## 8.1           PiggybackRegistration. If at any time the Company proposes to file a registrationstatement under the Securities Act of 1933, as amended (the “**SecuritiesAct**”), with respect to a public offering of the Company’s CommonStock (other than a registration statement relating to the sale of securitiesto participants in a dividend reinvestment plan, a registration on Form S-4 orsimilar or successor form thereto relating to a business combination or similartransaction permitted to be registered on such Form S-4, and a registration onForm S-8 or similar or successor form thereto relating to the sale ofsecurities to participants in a stock or employee benefit plan) while anyConversion Shares are issuable pursuant to this Note or are outstanding, theCompany shall give the Holder prior written notice of the filing of suchregistration statement (a “**Piggyback Registration**”) at the addressthat appears on the records of the Company. The notice shall offer to include in the registration statement any orall of the Registrable Shares (as defined below).   The Holder shall have until the 15th day afterreceipt of such notice to send to the Company a written request that shallspecify the number of Registrable Shares which the Holder desires to have includedin the registration statement. Subject to Section 8.2 and the provisobelow, the Company shall include in the filing for registration under theSecurities Act, the aggregate number of Registrable Shares which the Holderrequested to be included in such filing concurrently with the registration ofsuch other securities, all to the extent required to permit the public offeringand sale of the Registrable Shares; *provided, however*, that if theregistration statement pursuant to which the Holder is exercising its rightspursuant to this Section 8.1 is being filed by the Company as a resultof a demand received by the Company from shareholders (each a “**DemandingShareholder**”) exercising their demand registration rights pursuantto the Registration Rights Agreement dated July 23, 2003 (the “**RegistrationRights Agreement**”) by and among the Company, CityNetTelecommunications, Inc. (“**CityNet**”) and each party executing a JoinerAgreement, then the aggregate number of Registrable Shares that may beregistered by the Holder pursuant to such registration statement shall belimited to that number of shares equal to the product of: (1) the aggregateRegistrable Shares, multiplied by (2) a fraction, the numerator of which shallbe the aggregate amount of shares of Common Stock being requested to beregistered by the Demanding Shareholders, and the denominator of which shall bethe aggregate amount of “Registrable Shares” (as defined in the RegistrationRights Agreement) held by the Demanding Shareholders.  If any Piggyback Registration results from a demand by aDemanding Shareholder, the Company shall so advise the Holder as part of thenotice given pursuant to this Section 8.1. The Company will use itsreasonable efforts through its officers, directors, auditors, and counsel tocause the registration statement to become effective as promptly as reasonablypracticable.

 

## “**RegistrableShares**” shall mean (i) any shares of Common Stock issuable to theHolder upon the conversion of all or any portion of this Note, and (ii) anyother securities issued or issuable with respect to any such shares describedin clause (i) above by way of a stock dividend or stock split or in connectionwith a combination of shares, recapitalization, merger, consolidation, sale ofassets or other reorganization, *provided, however*, that shares ofCommon Stock shall cease to be Registrable Shares at the time that (i) suchshares are eligible to be sold by the Holder pursuant to Rule 144(k)promulgated under the Securities Act, or (ii) such shares have been sold by theHolder in a transaction exempt from the registration and prospectus deliveryrequirements of the Securities Act so that all transfer restrictions andrestrictive legends with respect to such shares are removed upon theconsummation of such sale.

 

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## 8.2           UnderwrittenOffering. If any Piggyback Registration involves an underwritten offering,the Company shall so advise the Holder as part of the notice given pursuant to Section8.1.  The Company shall (togetherwith all other holders of Common Stock proposing to distribute their securitiesthrough such underwriting), if requested by the underwriter, enter into anunderwriting agreement in customary form with a managing underwriter selectedfor such underwriting by the Company. Notwithstanding any other provision ofthis Section 8.2, if the managing underwriter advises the Company inwriting that the total amount of securities requested to be included in suchPiggyback Registration exceeds the amount which can be sold in (or during thetime of) such offering without delaying or jeopardizing the success of theoffering (including the price per share of the securities to be sold), then theamount of securities to be offered for the account of the Company and of anyholder of securities (including the Holder) shall be reduced to a number deemedsatisfactory by such managing underwriter or underwriters, provided, that thesecurities to be excluded shall be determined in the following sequence:

 

### (a)                                  in the event theoffering was demanded or proposed by or for the account of holders ofsecurities of the Company (the “**Proposing Holders**”): (A) first, securitiesproposed to be offered for the account of the Company; (B) second, RegistrableShares requested to be registered by the Holder and securities requested to beregistered by any other holders of securities of the Company other than (i)Proposing Holders or (ii) holders of “Registrable Shares” as that term isdefined in the Registration Rights Agreement (the “**CityNet Registrable Shares**”and the holders of such shares shall be the “**CityNet Holders**”), on a prorata basis (based upon the number of shares of Common Stock beneficially heldby each such holder); (C) third, CityNet Registrable Shares held by the CityNetHolders, on a pro rata basis (based upon the number of CityNet RegistrableShares beneficially held by each such holder); and (D) fourth, securities heldby the Proposing Holders, on a pro rata basis (based upon the number or ofshares of Common Stock beneficially held by each such holder); and

 

### (b)                                 in the event theoffering was proposed by or for the account of the Company: (A) first,Registrable Shares requested to be registered by the Holder and securitiesrequested to be registered by any other holders of securities of the Companyother than CityNet Registrable Shares held by the CityNet Holders, on a prorata basis (based upon the number of shares of Common Stock beneficially heldby each such holder); (B) second, CityNet Registrable Shares held by theCityNet Holders on a pro rata basis (based upon the number of CityNetRegistrable Shares beneficially held by each such holder); and (C) third,securities proposed to be offered for the account of the Company.

 

## 8.3           NoLiability. Nothing in this Note shall create any liability on the part ofthe Company to the Holder if the Company, in its sole discretion, should decidenot to file a Registration Statement proposed to be filed pursuant to Section8.1 hereof or to withdraw such Registration Statement subsequent to itsfiling, regardless of any action whatsoever that the

 

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## Holder mayhave taken, whether as a result of the issuance by the Company of any noticehereunder or otherwise.

 

## 8.4           Expensesof Registration. All Registration Expenses (defined below) incurred inconnection with a Piggyback Registration shall be borne by the Company. AllSelling Expenses (defined below) incurred in connection with a PiggybackRegistration shall be borne by Holder for the Registrable Shares so registered.For purposes of this Section 8.4:

 

### (a)                                  “**Registration Expenses**” shallmean all expenses incurred by the Company in connection with a PiggybackRegistration, including, without limitation, (i) all registration and filingfees, including NASD filing fees, (ii) all fees and expenses of compliance withsecurities or Blue Sky laws, (iii) printing expenses, (iv) messenger, telephoneand delivery expenses, (v) fees and disbursements of counsel for the Company,(vi) fees and disbursements of all independent certified public accountants ofthe Company (including expenses of any “cold comfort” letters required) and allother persons retained by the Company in connection with such PiggybackRegistration, and (vii) fees and disbursements of underwriters customarily paidby the issuers or sellers of securities.

 

### (b)                                 “**Selling Expenses**” shall meanall underwriting discounts and selling commissions applicable to the sale ofthe Registrable Shares in the Piggyback Registration and all fees anddisbursements of any special counsel (other than the Company’s regular counsel)of the Holder.

 

## 8.5           Qualificationfor sale. In connection with a Piggyback Registration, the Company shalluse its reasonable best efforts to cause the Registrable Shares so registeredto be registered or qualified for sale under the securities or blue sky laws ofsuch jurisdictions as the Holder may reasonably request; *provided, however*,that the Company shall not be required to qualify to do business in any stateby reason of this Section 8.5 in which it is not otherwise required toqualify to do business.

 

## 8.6           Effectiveness.In connection with a Piggyback Registration, the Company shall prepare and filewith the Securities and Exchange Commission (the “**Commission**”) a registrationstatement with respect to the Registrable Shares requested to be registered anduse its reasonable best efforts to cause such registration statement to becomeeffective, and shall keep effective any Piggyback Registration and shall fromtime to time amend or supplement each applicable registration statement,preliminary prospectus, final prospectus, application, document andcommunication for such period of time as shall be required to permit Holder tocomplete the offer and sale of the Registrable Shares covered thereby.  The Company shall in no event be required tokeep any such Piggyback Registration in effect for more than twelve (12) monthsfrom the initial effective date of the Piggyback Registration; *provided,however*, that, if during the twelve (12) month period ofeffectiveness of the registration statement, the Company gives to the Holder aBlackout Notice pursuant to Section 8.7, the Company shall extend theeffectiveness of the registration statement for the same time period as thatset forth in the Blackout Notice.

 

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## 8.7           BlackoutRights. Following the effective date of any registration statement filedpursuant to Section 8.1, the Company shall be entitled, from time totime, to notify the Holder to discontinue offers or sales of shares pursuant tosuch registration statement for Registrable Shares for the period of timestated in the written notice (the “**Blackout Notice**”), if the Companydetermines, in its reasonable business judgment, that the disclosure requiredin connection with the offers and sales of the Registrable Shares couldmaterially damage the Company’s ability to successfully complete anacquisition, corporate reorganization, securities offering or other voluntarytransaction undertaken by the Company (which information the Company would notbe required to disclose at such time other than in connection with the Holder’sregistration statement) that is material to the Company and its subsidiariestaken as a whole.  The time period forwhich the Holder must discontinue offers or sales of shares pursuant to aBlackout Notice shall be for any period the Company reasonably believes isnecessary, and if, the Company is unable to determine the duration of suchperiod at the time the Blackout Notice is issued, the Blackout Notice may statethat the period extends “until the Holder is otherwise notified by theCompany;” provided that the Blackout Notice may not exceed more than onehundred eighty (180) consecutive days within any period of three hundredsixty-five (365) consecutive days.  TheBlackout Notice shall be signed by an authorized officer of the Company andshall certify the Company’s determination. The Holder agrees that upon receipt of a Blackout Notice it shalldiscontinue offers or sales of Registrable Shares pursuant to any suchregistration statement for the period of time stated in the Blackout Notice.

 

## 8.8           Distributionof Registration Statement. In connection with Piggyback Registration, theCompany shall promptly furnish to the Holder such number of copies of theregistration statement and of each amendment and supplement thereto (in eachcase, including all exhibits), such reasonable number of copies of eachprospectus contained in such registration statement and each supplement oramendment thereto (including each preliminary prospectus), all of which shallconform to the requirements of the Securities Act and the rules and regulationsthereunder, and such other documents, as the Holder may reasonably request tofacilitate the disposition of the Registrable Shares included in suchregistration.

 

## 8.9           Notificationof Effectiveness. The Company shall notify the Holder promptly when suchregistration statement has become effective or a supplement to any prospectusforming a part of such registration statement has been filed.

 

## 8.10         OtherNotifications. The Company shall promptly notify the Holder at any timewhen the prospectus included in the Piggyback Registration, as then in effect,would include an untrue statement of a material fact or omit to state anymaterial fact required to be stated therein or necessary to make the statementstherein not misleading in the light of the circumstances then existing, and atthe reasonable request of the Holder prepare and furnish to it such number ofcopies of a supplement to or an amendment of such prospectus as may benecessary so that, as thereafter delivered to the purchasers of suchRegistrable Shares, such prospectus shall not include an untrue statement of amaterial fact or omit to state a material fact required to be stated therein ornecessary to make the statements therein not misleading in the light of thecircumstances under which they were made.

 

## 8.11         Indemnificationby Company. Subject to the conditions set forth below, the Company agreesto indemnify and hold harmless the Holder from and against any and all

 

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## loss,liability, charge, claim, damage, and expense whatsoever (which shall include,for all purposes of this Section 8.11, but not be limited to, reasonableattorneys’ fees and any and all reasonable expenses whatsoever incurred ininvestigating, preparing, or defending against any litigation, commenced orthreatened, or any claim whatsoever, and any and all amounts paid in settlementof any claim or litigation), as and when incurred, arising out of, based upon,or in connection with any untrue statement or alleged untrue statement of amaterial fact contained (A) in any registration statement, preliminaryprospectus, or final prospectus (as from time to time amended andsupplemented), or any amendment or supplement thereto, relating to the sale ofany of the Registrable Shares or (B) in any application or other document orcommunication (in this Section 8.11 collectively called an “**Application**”)executed by or on behalf of the Company and based upon written informationfurnished by or on behalf of the Company filed in any jurisdiction in order toregister or qualify any of the Registrable Shares under the Securities Act orblue sky laws thereof or filed with the Commission or any securities exchange;or any omission or alleged omission to state a material fact required to bestated therein or necessary to make the statements made therein not misleading,unless such statement or omission was made in reliance upon and in conformitywith written information furnished to the Company by or on behalf of the Holderfor inclusion in any registration statement, preliminary prospectus, or finalprospectus, or any amendment or supplement thereto, or in any Application, asthe case may be.

 

# If any action is brought against the Holder in respect of whichindemnity may be sought against the Company pursuant to the foregoingparagraph, the Holder shall promptly notify the Company in writing of theinstitution of such action (the failure to notify the Company within areasonable time of the commencement of any such action, to the extentprejudicial to the Company’s ability to defend such action, shall relieve theCompany of liability to the Holder pursuant to this Section 8.11 and theCompany shall promptly assume the defense of such action, including theemployment of counsel, provided that the Holder shall have the right to employhis or her own counsel in any such case, but the fees and expenses of suchcounsel shall be at the expense of the Holder unless the employment of suchcounsel shall have been authorized in writing by the Company in connection withthe defense of such action or the Holder shall have reasonably concluded thatthere may be one or more legal defenses available to him or her which aredifferent from or additional to those available to the Company, in any of whichevents such fees and expenses shall be borne by the Company and the Companyshall not have the right to direct the defense of such action on behalf of theHolder. Notwithstanding anything in this Section 8.11 to the contrary,the Company shall not be liable for any settlement of any such claim or actioneffected without its written consent. The Company shall not, without the prior written consent of the Holder,settle or compromise any action, or permit a default or consent to the entry ofjudgment in or otherwise seek to terminate any pending or threatened action, inrespective of which indemnity may be sought hereunder, unless such settlement,compromise, consent, or termination includes an unconditional release of theHolder from all liability in respect of such action. The Company agreespromptly to notify the Holder of the commencement of any litigation or proceedingsagainst the Company or any of its officers or directors in connection with thesale of any Registrable Shares or any preliminary prospectus, prospectus,registration statement, or amendment or supplement thereto, or any applicationrelating to any sale of any Registrable Shares.

 

## 8.12         Indemnificationby Holder. The Holder agrees to indemnify and hold harmless the Company,each director of the Company, each officer of the Company who shall

 

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## have signedany registration statement covering Registrable Shares held by the Holder, tothe same extent as the foregoing indemnity from the Company to the Holder in Section8.11, but only with respect to statements or omissions, if any, made in anyregistration statement, preliminary prospectus, or final prospectus (as fromtime to time amended and supplemented), or any amendment or supplement thereto,or in any Application, in reliance upon and in conformity with writteninformation furnished to the Company with respect to the Holder by or on behalfof the Holder, for inclusion in any such registration statement, preliminaryprospectus, or final prospectus, or any amendment or supplement thereto, or inany application, as the case may be.  Ifany action shall be brought against the Company or any other person soindemnified based on any such registration statement, preliminary prospectus,or final prospectus or any amendment or supplement thereto, or in anyApplication, and in respect of which indemnity may be sought against the Holderpursuant to this Section 8.12, the Holder shall have the rights andduties given to the Company, and the Company and each other person soindemnified shall have the rights and duties given to the Holder, by theprovisions of Section 8.12.

 

## 8.13         Terminationof Registration Rights. The covenants set forth in Section 8 of thisNote shall terminate on the first date on which no Registrable Shares remainoutstanding.

 

## 8.14         Lock-Up.The Holder hereby agrees that, if so requested by the Company or anyrepresentative of the underwriters in connection with any registration of theoffering of any securities of the Company under the Securities Act, the Holdershall not, directly or indirectly, sell or otherwise transfer any RegistrableShares during the same period (the “**Market Standoff Period**”) requested inwriting by the managing underwriter and agreed to in writing by the Company andall of its executive officers, directors, greater than five percentshareholders of the Company and all other shareholders having shares registeredpursuant to such registration statement; *provided, however,*that no shareholdershall be subject to the restrictions of this Section 8.14, if theshareholder beneficially owns less than 3% of the outstanding Common Stock ofthe Company (assuming conversion of all convertible securities of the Companybeneficially owned by such shareholder) and if the shareholder is not at suchtime an affiliate (as defined below) of the Company or any of its directors anddoes not at such time have power to designate or select one or more members ofthe Board of Directors of the Company. The Company may impose stop transfer instructions with respect to sharessubject to the foregoing restrictions until the end of such Market Standoff Period.For purposes of this Section, an “affiliate” of a person (or entity) shall mean(i) any person or entity who directly or indirectly is in control of, iscontrolled by or is under common control with such first person (or entity);(ii) any person who is a director or executive (as defined in Rule 3b-7promulgated under the Exchange Act) of such first person (or entity) describedin clause (i) above; or (iii) any person who is an immediate family member ofany person described in clause (ii) above.

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# 9.             Reservationof Stock. The Company shall at all times reserve and keep available out ofits authorized but unissued shares of Common Stock solely for the purpose ofeffecting the conversion of the Note, such number of shares of Common Stock asshall from time to time be sufficient to effect the conversion of the Note; andif at any time the number of authorized but unissued shares of Common Stockshall not be sufficient to effect the conversion of the entire outstandingprincipal and interest, if any, of this Note, in addition to such otherremedies as shall be available to the holder of this Note, the Company will useits best efforts to take such

 

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# corporateaction as may be necessary to increase its authorized but unissued shares ofCommon Stock to such number of shares as shall be sufficient for such purposes.

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# 10.           Assignment.  This Note shall be binding upon the Companyand its successors, assigns, heirs and representatives, and shall inure to thebenefit of the Holder and its permitted successors and assigns.

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# 11.           Waiverand Amendment.  Any provision ofthis Note may be amended, waived or modified upon the written consent of theCompany and the Holder of this Note. The Company hereby waives any and all defenses it may have to theenforcement by the Holder of this Note.

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# 12.           Transferof this Note or Securities Issuable on Conversion Hereof.  This Note may not be sold, transferred,assigned or otherwise disposed of by the Holder without the prior written consentof the Company which consent shall not unreasonably be withheld.  As a condition to the Company’s consent toany transfer, the Company may require the Holder to provide the Company with awritten opinion, to the effect that such offer, sale, transfer or otherdistribution may be effected without registration or qualification (under anyfederal or state law then in effect) under any federal or state security act.

#  

# 13.           Notices.  All notices or other communications requiredor permitted hereunder shall be in writing and shall be deemed given, deliveredand received (i) when delivered, if delivered personally, (ii) four days aftermailing, when sent by registered or certified mail, return receipt requestedand postage prepaid, and (iii) one business day after delivery to a privatecourier service, when delivered to a private courier service providingdocumented overnight service, in each case addressed to a party at its addressset forth below, or to such other address as the party to receive such notice mayhave designated to all other parties by notice in accordance herewith: 

 
| If to  Company:  |   | Universal  Access Global Holdings Inc.   |
|------------------|--------|------------------------------------------|
|             |   | Attention:  Chief Executive Officer |
|             |   | 233 South  Wacker Drive, Suite 600       |
|             |   | Chicago, IL  60606                       |
|             |   | Telephone:  (312) 660-5000          |
|             |   |                                     |
| With a copy  to: |   | Shefsky  & Froelich Ltd.             |
|             |   | Attention:  Cezar M. Froelich       |
|             |   | 444 North  Michigan Avenue, Suite 2500   |
|             |   | Chicago,  Illinois  60611           |
|             |   | Telephone:  (312) 527-4000          |
|             |   |                                     |
|             |   |                                     |
| If to  Holder:   |   | Lafayette  Business Park, LLC            |
|             |   | Attention:                               |
|             |   |                                     |
|             |   |                                     |
|             |   | Telephone:                               |

 

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# 14.           NoShareholder Rights.  Nothingcontained in this Note shall be construed as conferring upon the Holder or anyother person the right to vote or to consent or to receive notice as a shareholderin respect of meetings of shareholder for the election of directors of theCompany or any other matters or any rights whatsoever as a shareholder of theCompany, and no distributions or dividends in cash or in kind shall be payableor accrued in respect of this Note or the interest represented hereby or theConversion Shares obtainable hereunder until, and only to the extent that, thisNote shall have been converted.

#  

# 15.           Failureor Indulgency Not Waiver.  Nofailure 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 anysingle or partial exercise of any such power, right of privilege preclude otheror further exercise thereof or of any other right, power or privilege.  All rights and remedies existing hereunderare cumulative to, and not exclusive of, any rights or remedies otherwiseavailable.

#  

# 16.           Attorneys’Fees.  The Company shall pay allattorneys’ fees and other costs incurred by the Holder in enforcing the termsof this Note.

#  

# 17.           GoverningLaw; Venue. The parties agree that this Note shall be governed by,interpreted and construed in accordance with the laws of the State ofCalifornia, and the parties agree that any suit, action or proceeding with respectto this Note shall be brought in the courts of Santa Clara County in the Stateof California or in the U.S. District Court for the Northern District ofCalifornia.  The parties hereto acceptthe sole and exclusive jurisdiction of those courts for the purpose of any suchsuit, action or proceeding.

#  

# 18.           Headings;References.  All headings usedherein are used for convenience only and shall not be used to construe orinterpret this Note.  Except whereotherwise indicated, all references herein to Sections refer to Sectionshereof.

#  

# 19.           EntireAgreement. This Note, together with the Agreement, contains the entireagreement and understanding of the parties hereto, and supersedes all prioragreements and understandings relating to the subject matter hereof.

#  

**[Signature PageFollows]**

 

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IN WITNESS WHEREOF, the parties hereto havecaused their duly authorized officers to execute and deliver this ConvertiblePromissory Note as of the date first written above.

 
|   | UNIVERSAL ACCESS GLOBAL  HOLDINGS INC. |
|--------|----------------------------------------|
|   |                                   |
|   |                                   |
|   | By:                                    | /S/ Randall R. Lay |
|   |                                   | Randall Lay, CEO |

 

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**NOTICE OF EXERCISE**

 

To:          UniversalAccess Global Holdings Inc. (the “**Company**”)

 

# 1.             TheHolder hereby elects to (check one):

#  

o    convert the entire outstanding principal and interest, if any, under theattached Convertible Promissory Note dated April     , 2004issued by the Company in favor of Holder (the “**Note**”) for                      shares of common Stock of the Company (the “**ConversionShares**”) pursuant to the terms of the Note; or

 

o    convert that portion of outstanding principal and interest, if any, under theNote equal to$              [insert dollar amount of principal and interest, if any, to be converted] for                Conversion Shares.

 

## Capitalized terms used herein and not otherwise defined shall have themeaning set forth in the Note.

##  

# 2.             Upondelivery of the Notice of Exercise and surrender of the Note, the Company shallissue to Holder the Conversion Shares and a Replacement Note, if applicable.

#  

# 3.             TheConversion Shares to be received by the Holder upon exercise of the Note arebeing acquired for its own account, not as a nominee or agent, and not with aview to resale or distribution of any part thereof, and the Holder has nopresent intention of selling, granting any participation in, or otherwisedistributing the same, except in compliance with applicable federal and statesecurities laws.  The Holder furtherrepresents that it does not have any contract, undertaking, agreement orarrangement with any person to sell, transfer or grant participation to suchperson or to any third person, with respect to the Conversion Shares.  The Holder believes it has received all theinformation it considers necessary or appropriate for deciding whether topurchase the Conversion Shares.

#  

# 4.             Theundersigned understands that the Conversion Shares are characterized as“restricted securities” under the federal securities laws inasmuch as they arebeing acquired from the Company in transactions not involving a public offeringand that under such laws and applicable regulations such securities may beresold without registration under the Securities Act of 1933, as amended (the “**Act**”), only in certain limitedcircumstances.  In this connection, theHolder represents that it is familiar with Rule 144 of the Act, as presently ineffect, and understands the resale limitations imposed thereby and by the Act.

#  

# 5.             Theundersigned understands the certificates evidencing the Conversion Shares maybear one or all of the following legends:

#  

(a)           “THESESECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, ASAMENDED, OR ANY STATE SECURITIES LAWS. THEY HAVE BEEN ACQUIRED SOLELY FOR INVESTMENT AND NOT WITH A VIEW TO, ORIN CONNECTION WITH, THE

 

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 SALE OR DISTRIBUTIONTHEREOF.  THEY MAY NOT BE SOLD, OFFEREDFOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE DISTRIBUTED IN THE ABSENCE OF ANEFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN EXEMPTION FROMREGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED AND ANY APPLICABLESTATE SECURITIES LAWS.”

 

(b)           Anylegend required by applicable state law.

 

# 6.             Pleaseissue a certificate or certificates representing said Conversion Shares in **[the name ofthe Holder]****[insert other name if not Holder]**.

#  

# 7.             Theundersigned hereby covenants that he, she or it shall not sell, pledge orotherwise transfer or dispose of any Conversion Shares except in accordancewith applicable state and federal securities laws.  

#  

#  

|   | **HOLDER:**            |
|--------|------------------------|
|   |                   |
|   |                   |
|   |                   |
|   | (Print Name of Holder) |
|   |                   |
|   | By:                    |   |
|   | Its:                   |   |
|   | Address:               |   |
|   |                   |   |
|   | Dated:                 |   |

 

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