Exhibit 10.6


 


THIS NOTE AND THE MEMBERSHIP UNITS ISSUABLE UPON EXCHANGE OF THIS NOTE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY
NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT
REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR UNLESS SOLD PURSUANT TO RULE 144
UNDER SUCH ACT.


 


SECURED
EXCHANGEABLE PROMISSORY NOTE


 


	
  $30,000,000

  	
   

  	
  Atlanta,
  Georgia

                          , 2007

  



 


 


FOR VALUE RECEIVED, the
undersigned, HELIO, INC., a Delaware corporation (the “Company”),
promises to pay to EARTHLINK, INC., a Delaware corporation (“Lender”), the principal amount of Thirty Million Dollars
($30,000,000), with interest thereon from July 25, 2007 until paid in full on
the Maturity Date at a rate per annum equal to ten percent (10.00%), calculated
on the basis of a 360-day year and the actual number of days elapsed. Capitalized
terms used in this Note without definition shall have the meanings provided in
that certain Note Purchase and Security Agreement and Guaranty entered into as
of July 23, 2007 (as amended, modified and supplemented from time to time, the “Purchase Agreement”), by and between the Company, HELIO,
LLC, a Delaware LLC (“Guarantor”,
together with the Company, the “Note Parties”,
and individually, a “Note Party”)
and Lender. To the extent set forth in the Purchase Agreement and subject to
the provisions in the Purchase Agreement, the Guarantor guarantees the payment
of the Obligations of the Company under the Note. This Note replaces the note
issued July 25, 2007 pursuant to the Purchase Agreement, which note is hereby
cancelled.


 


The principal amount of this
Note and all accrued interest thereon shall be due and payable on the Maturity
Date. On the Maturity Date the entire unpaid principal balance of this Note,
together with any and all accrued and unpaid interest (including, without limitation,
all interest that has been added to principal hereunder) and any and all costs
and expenses provided for under this Note and the other Note Documents, shall
be due and payable. This Note may be prepaid at any time without penalty.


 


All payments under this Note
shall be made to Lender or its order, in lawful money of the United States of
America and in immediately available funds delivered to Lender by wire transfer
of immediately available funds to Lender’s account, at Bank of
America, 100 West 331d Street, New York, New York 10001, ABA No. 0260-0959-3,
Swift Code: BOFAUS3N, Account Name: EarthLink, Inc., Account No. 003271085419,
or at such other place within the United States as Lender or any holder hereof
shall designate in writing for such purpose from time to time. If a payment
under this Note otherwise would become due and payable on a day that is not a
Business Day, the due date thereof shall be extended to the next Business Day
and interest shall be payable thereon during such extension. All amounts due
under this Note and the other Note Documents shall be payable without defense,
set off or counterclaim.


 


Each payment under this Note
shall be applied in the following order: (i) to the payment of costs and
expenses which the Company is required to pay pursuant to the provisions of
this Note or any of the other Note Documents; (ii) to the payment of accrued
and unpaid interest; and (iii) to the payment of outstanding principal. Lender
and each holder hereof shall have the continuing and exclusive right to apply
or reverse and reapply any and all payments under this Note.


 


Subject to the further
provisions of this Note, any holder hereof may exchange this Note (or portion
thereof) at any time through the close of business on the Maturity Date at the Exchange
Price then in effect into Preferred Membership Units of the Guarantor (the “Membership Units”). The number of Membership Units issuable
upon exchange of the Note shall be determined by dividing the outstanding


 


 

















 


principal amount (excluding accrued and
unpaid interest) of the Note (or portion thereof) surrendered for exchange by
the Exchange Price in effect on the Exchange Date (as defined herein). In
connection with any such exchange, such holder also shall have the right to
receive a payment (each, an “Exchange Interest Payment”),
at the time and in the manner provided herein, of the accrued and unpaid
interest with respect to the outstanding principal amount of the Note (or
portion thereof) so exchanged, which payment shall be made, at the election of
the Guarantor, in cash, Membership Units, or a combination thereof. Subject to
adjustment or voluntary reduction as provided herein, the Exchange Price
initially shall be $3.00 per Membership Unit.


 


A holder hereof is not
entitled to any rights as a Member of the Guarantor by virtue of the Note until
such holder has exchanged its Note for Membership Units.


 


To exchange the Note, the holder
hereof must (i) complete and manually sign the exchange notice on the back
of the Note (or complete and manually sign a facsimile of such notice) and
deliver such notice to the Company and the Guarantor, (ii) surrender the
Note to the Company, (iii) have satisfied any necessary filing
requirements under the Hart-Scott-Rodino Act of 1976, as amended (the “HSR Act”), in respect of its acquisition of the Membership
Units upon such exchange and the waiting period under such HSR Act shall have
expired or been terminated without objection to such acquisition,
(iv) have received any other necessary regulatory consents to its
acquisition of the Membership Units upon such exchange and (v) pay any
transfer or similar tax if required herein. The date on which the holder hereof
satisfies all of those requirements is the “Exchange
Date.”  The notice of exchange
shall state that such holder has satisfied or will have satisfied prior to the
issuance of Membership Units upon exchange of such principal amount, and prior
to the payment of the Exchange Interest Payment, any and all legal or
regulatory requirements for exchange, including compliance with the Securities
Act of 1933, as amended (the “Securities Act”),
the Securities Exchange Act of 1934, as amended (the “Exchange Act”)
and the HSR Act. The Guarantor shall use their reasonable best efforts in
cooperating in a timely manner with the holder hereof to obtain such legal or
regulatory approvals to the extent its cooperation is necessary.


 


As soon as practicable after
the Exchange Date and in no event later than five Business Days following the Exchange
Date, the Guarantor shall deliver to the holder hereof (i) Membership Units
issuable upon the exchange of the Note or portion thereof, (ii) cash in
lieu of any fractional Membership Units and (iii) cash, Membership Units,
or a combination thereof, in an amount equal to the Exchange Interest Payment.


 


The Person or Persons in
whose name the Membership Units are registered shall be deemed to be a Member
of the Guarantor on and after the Exchange Date, as the case may be. Upon
exercise of the Note (in whole and not in part), such Person shall no longer be
a holder of the Note.


 


Upon surrender of the Note exchanged
in part, as soon as practicable after the Exchange Date and in no event later
than five Business Days following the Exchange Date, the Company shall execute
and deliver to the holder hereof, a new Note equal in principal amount to the
unexchanged portion of the Note surrendered.


 


If the last day on which a
Note may be exchanged is not a Business Day, the Note may be surrendered to the
Company on the next succeeding day that is a Business Day.


 


The Guarantor shall not
issue fractional Membership Units upon exchange of the Note. In lieu thereof,
the Guarantor shall, at the Guarantor’s option, pay an amount in cash based
upon the Exchange Price or round up the number of Membership Units issuable
upon such exchange to the next highest whole number.


 


If the holder hereof exchanges
the Note, the Guarantor shall pay any documentary, stamp or similar issue or
transfer tax due on the issue of Membership Units upon such exchange. However, such


 


2

















 


holder shall pay any such tax that is due
because such holder requests the Membership Units to be issued in a name other
than such holder’s name. The Guarantor may refuse to deliver the Membership Units
being issued in a name other than such holder’s name until the Guarantor
receives a sum sufficient to pay any tax which will be due because the Membership
Units are to be issued in a name other than such holder’s name. Nothing herein
shall preclude any tax withholding required by law or regulation.


 


The
Exchange Price shall be adjusted from time to time by the Guarantor in the
event the Guarantor shall (A) make a distribution in Membership Units to
all holders of its Membership Units, (B) subdivide or split its outstanding Membership Units into a larger number of Membership Units, or (C) combine
its outstanding Membership Units into a smaller number of shares, the Exchange
Price in effect immediately prior thereto shall be adjusted so that the holder
hereof shall be entitled to receive that number of Membership Units that it
would have owned or been entitled to receive had the Note been exchanged
immediately prior to the happening of such event. If any distribution of the type
described in this paragraph is declared but not so made, the Exchange Price
shall again be adjusted to the Exchange Price that would then be in effect if
such distribution had not been declared.


 


If any of the following shall occur, namely: 
(A) any reclassification or change of Membership Units issuable upon exchange
of the Note (other than as a result of a subdivision or combination, or any
other change for which an adjustment is provided in this Note); (B) any
consolidation, merger or combination to which the Guarantor is a party other
than a merger in which the Guarantor is the continuing corporation and which
does not result in any reclassification of, or change (other than a change in
name or as a result of a subdivision or combination) in, outstanding Membership
Units; or (C) any sale, transfer or conveyance of all or substantially all
of the property and assets of the Guarantor to any Person, then the Guarantor,
or such successor or purchasing corporation or, if applicable, the parent
entity of such successor or purchasing entity, as the case may be, shall, as a
condition precedent to such reclassification, change, consolidation, merger,
combination, sale, transfer or conveyance, execute and deliver to the holder
hereof an amendment to the Note providing that such holder of the Note then
outstanding shall have the right to exchange the Note into the kind and amount
of securities and property (including cash) receivable upon such
reclassification, change, consolidation, merger, combination, sale, transfer or
conveyance by a holder of the number Membership Units deliverable upon exchange
of such Note immediately prior to such reclassification, change, consolidation,
merger, sale, transfer or conveyance.


 


No adjustment in the Exchange
Price shall be required unless the adjustment would require an increase or
decrease of at least 1% in the Exchange Price as last adjusted; provided that any adjustments which by
reason of this paragraph are not required to be made shall be carried forward
and taken into account in any subsequent adjustment. All calculations for
adjustment shall be made to the nearest cent or to the nearest one hundredth of
a share, as the case may be. No
adjustment need be made for (i) the issuance of options or rights to purchase Membership
Units pursuant to any present or future employee, director or consultant
benefit plan or program of or assumed by the Guarantor or any subsidiary or
(ii) the issuance of Membership Units pursuant to any option, warrant,
right or exercisable, exchangeable or convertible security outstanding as of
the date hereof. To the extent that the Note becomes exchangeable into the
right to receive cash, no adjustment need be made thereafter as to the cash.
Interest will not accrue on the cash.


 


The Guarantor shall be entitled to make such
reductions in the Exchange Price, in addition to those required by the terms of
this Note, as it in its discretion shall determine to be advisable in order
that any unit distributions, subdivisions of units, distributions of rights to
purchase stock or debt or distributions of debt convertible into or
exchangeable for Equity Interests hereafter made by the Guarantor to its Members
shall not be taxable, provided
that such reduction does not have an adverse effect for tax purposes, or
otherwise, on the holder hereof.


 


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Whenever the Exchange Price is adjusted, the Company
shall promptly mail to the holder hereof a notice of the adjustment and an
officers’ certificate briefly stating the facts requiring the adjustment, the
manner of computing it, the new Exchange Price and the date on which the
adjustment becomes effective.


 


In the event that (i) the Guarantor takes any
action that would require an adjustment in the Exchange Price, (ii) the Guarantor
consolidates, merges or combines with, or transfers all or substantially all of
its property and assets to, another Person and Members of the Guarantor must
approve the transaction, or (iii) there is a dissolution, liquidation or
winding up of the Guarantor, the Company shall mail to the holder hereof a
notice stating the proposed record or effective date, as the case may be. The
Company shall mail the notice at least 15 days before such date.


 


This Note is one of a series of Notes issuable to
the Lenders pursuant to the terms of the Purchase Agreement and in accordance
with the Lenders Commitments as described therein. All payments made to Lenders
under this Note and any other Notes shall be made by the Company to each Lender
at the same times and in proportion to each Lender’s Pro Rata Share. No Lender
shall have a priority of payment over another Lender with respect to payments
due under the Notes.


 


Upon the occurrence of any Event of Default, the
obligations under this Note shall become due and payable in accordance with the
provisions of the Purchase Agreement, and Lender shall have all other remedies
available under the Purchase Agreement. In addition, upon the occurrence of an
Event of Default, interest shall thereafter accrue on the entire unpaid
principal balance under this Note, including without limitation (x) any accrued
interest which has been added to the principal balance and (y) any delinquent
interest which has been added to the principal amount due under this Note
pursuant to the terms hereof, at the rate set forth herein plus two percent
(2.00%) per annum (on the basis of a 360-day year and the actual number of days
elapsed). All interest which has become payable and is then delinquent shall,
without curing the default under this Note by reason of such delinquency, be
added to the principal amount due under this Note, and shall thereafter bear
interest at the same rate as is applicable to principal, with interest on
overdue interest to bear interest, in each case to the fullest extent permitted
by applicable law, both before and after default, maturity, foreclosure,
judgment and the filing of any petition in a bankruptcy proceeding. In no event
shall interest be charged under this Note which would violate any applicable
law. If the rate of interest provided for herein would otherwise exceed the
maximum rate permitted by applicable law, then the interest rate shall be
reduced to the maximum rate permitted by applicable law.


 


This Note is secured as set forth in the Purchase
Agreement. Reference is hereby made to the Purchase Agreement for a description
of the nature and extent of the security for this Note and the rights and
remedies available to the holder of this Note. Nothing herein shall be deemed
to limit the rights of Lender under this Note or the Note Agreement, all of
which rights and remedies are cumulative.


 


No waiver or modification of any of the terms of
this Note shall be valid or binding unless set forth in a writing specifically
referring to this Note and signed by a duly authorized officer of Lender or any
holder of this Note, and then only to the extent specifically set forth
therein.


 


If any default occurs in any payment due under this
Note, the Company and all guarantors and endorsers hereof, and their successors
and assigns, promise to pay all costs and expenses, including attorneys’ fees,
incurred by each holder hereof in collecting or attempting to collect the
indebtedness under this Note, whether or not any action or proceeding is
commenced. None of the provisions hereof and none of the holder’s rights or
remedies under this Note on account of any past or future defaults shall be
deemed to have been waived by the holder’s acceptance of any past due
installments or by any indulgence granted by the holder to the Company.


 


The Company and all guarantors and endorsers hereof,
and their successors and assigns, hereby waive presentment, demand, diligence,
protest and notice of every kind (except such notices as may be


 


4

















 


required
under the Purchase Agreement), and agree that they shall remain liable for all
amounts due under this Note notwithstanding any extension of time or change in
the terms of payment of this Note granted by any holder hereof, any change,
alteration or release of any property now or hereafter securing the payment
hereof or any delay or failure by the holder hereof to exercise any rights
under this Note or the Purchase Agreement. The Company and all guarantors and
endorsers hereof, and their successors and assigns, hereby waive the right to plead
any and all statutes of limitation as a defense to a demand under this Note to
the full extent permitted by law.


 


As set forth in the Purchase Agreement, the Lender
may not assign or transfer its rights and obligations under this Note without
the prior written consent of SK Telecom USA Holdings, Inc. This
Note shall inure to the benefit of Lender, its successors and assigns and shall
bind the heirs, executors, administrators, successors and assigns of the
Company. Each reference herein to powers or rights of Lender shall also be
deemed a reference to the same power or right of such assignees, to the extent
of the interest assigned to them.


 


In the event that 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 provision of this Note and the remaining provisions
of this Note shall remain in full force and effect.


 


This Note shall be governed by and construed in
accordance with the laws of the State of Georgia, without giving effect to the
principles thereof relating to conflicts of law; provided, that Lender and each
holder hereof reserves any and all rights it may have under federal law,
including without limitation those relating to the charging of interest.


 


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IN WITNESS WHEREOF, the
Company has caused this Secured Exchangeable Promissory Note to be duly executed
the day and year first above written.


 


 


	
   

  	
   

  	
  HELIO, INC.,

  
	
   

  	
   

  	
  a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Sky Dayton

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
						



 


 


[Signature Page to
Secured Exchangeable Promissory Note]