Unassociated Document


     

    THIS NOTE
AND THE SECURITIES ISSUABLE UPON CONVERSION HEREOF HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE PROVISIONS OF ANY
APPLICABLE STATE SECURITIES LAWS.  THIS NOTE AND THE SECURITIES
ISSUABLE UPON CONVERSION HEREOF MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED,
HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED.

     

    UNSECURED CONVERTIBLE
PROMISSORY NOTE

     

    
      	
              $65,698.05

            	
              Note
      11-2

              February
      10, 2011

            


    

    


    FOR VALUE
RECEIVED, ProUroCare Medical Inc., a Nevada corporation (the “Company”), hereby
promises to pay to Maslon,
Edelman, Borman & Brand, LLP(“Holder”), the
principal sum of SIXTY-FIVE THOUSAND SIX HUNDRED NINETY-EIGHT AND 05/100 DOLLARS
($65,698.05), together
with interest as provided for herein, in lawful currency of the United States of
America.

     

    SECTION
1
Terms

     

    Section
1.1 Maturity.  Subject
to the earlier conversion of this Unsecured Convertible Promissory Note (the
“Note”), the
entire outstanding principal amount of this Note, together with the interest
accrued on this Note from the date of this Note through the date of payment,
shall be payable to the Holder in cash on August 10, 2012 (the “Maturity
Date”).

     

    Section
1.2 Interest.  Interest
shall accrue on the unpaid principal at a rate of 6.00% per annum on a 365/360
basis;  that is, by applying the ratio of the annual interest rate
over a year of 360 days, multiplied by the outstanding principal balance,
multiplied by the actual number of days outstanding.  Accrued interest
will be paid at the end of each calendar quarter unless the Note is prepaid
pursuant to Section 1.4.

     

    Section
1.3 Optional
Conversion.  At anytime or from time to time, at the option of
the Holder, all or any portion of the outstanding principal amount of this Note
(the “Converted
Balance”), together with interest accrued thereon to the date of
conversion, may be converted into that number of shares of the Company’s common
stock, $0.00001 par value per share (the “Common Stock”), as is
obtained by dividing the Converted Balance by $1.30 (the “Conversion
Price”).

     

    Section
1.4 Optional
Prepayment.  Subject to the Holder’s right to have some or all
of the principal on this Note converted into Common Stock in accordance with
Section 1.3 hereof, the Company may, at its option, without premium or penalty,
upon thirty (30) days prior written notice to the Holder, repay the unpaid
principal amount of this Note, at any time in whole or from time to time in
part, together with interest accrued thereon to the date of
prepayment.  Any such prepayment shall be applied first to the payment
of accrued interest and then to repayment of principal.  Upon any
partial prepayment of the unpaid principal amount of this Note, the Holder shall
make notation on this Note of the portion of the principal so
prepaid.

     

    Section
1.5 Subordination.  This
Note shall be subordinated in all respects (including right of payment) to all
other indebtedness of the Company, now existing or hereafter owing, to banks and
other such financial institutions.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Section
1.6 No Fractional Shares or
Scrips.  No fractional shares or scrip representing fractional
shares shall be issued upon the conversion of this Note.  In lieu of
issuing such fractional shares, the Company shall round up the number of shares
to be issued to the nearest whole share.

     

    Section
1.7 No
Impairment.  Without limiting or altering the provisions or
obligations of the Company under this Note, the Company shall not avoid or seek
to avoid the observance or performance of any of the terms to be observed or
performed by it pursuant to this Note and shall at all times in good faith
assist in the observance or performance of any of the terms to be observed or
performed by it pursuant to this Note.

     

    Section
1.8 Release of
Obligations.  Upon conversion or prepayment of this Note, the
Company shall be forever released from all its obligations and liabilities under
this Note.

     

    Section
1.9 Adjustment.

     

    
      	 	
              (a)

            	
              Adjustments for
      Dividends and Distributions.  In the event the Company at
      any time or from time to time after the date hereof shall make, issue, or
      fix a record date for the determination of holders of capital stock
      entitled to receive a dividend or other distribution (including a stock
      split or subdivision) payable in securities of the Company, then and in
      such event provisions shall be made so that the Holder shall receive, upon
      conversion of this Note, in addition to the number of shares of Common
      Stock receivable thereupon, the amount of securities of the Company that
      the Holder would have received had this Note been converted into Common
      Stock on the date of such event and had the Holder thereafter, during the
      period from the date of such event to and including the conversion date,
      retained such securities receivable by the Holder as aforesaid during such
      period, giving application to all adjustments called for during such
      period under this Note with respect to the rights of the Holder under the
      Note.

            


    

     

    
      	 	
              (b)

            	
              Adjustment for
      Reclassifications, Exchanges, or Substitutions.  If the
      Common Stock issuable upon the conversion of this Note shall be changed
      into the same or different number of shares of any class or classes of
      capital stock, whether by capital reorganization, reclassification, or
      otherwise (other than a subdivision or combination of shares or stock
      dividend, or a reorganization, merger, consolidation, or sale of assets
      provided for elsewhere), then and in each such event the Holder shall have
      the right thereafter to convert this Note into the kind and amount of
      shares of capital stock and other securities and property receivable upon
      such reorganization, reclassification, or other change, by holders of the
      number of shares of Common Stock into which this Note might have been
      converted immediately prior to such reorganization, reclassification or
      change, all subject to further adjustment as provided
    herein.

            


    

     

    
      	 	
              (c)

            	
              Reorganization;
      Mergers; Consolidations; Sales of Assets.  If at any time
      or from time to time there shall be a capital reorganization of the Common
      Stock issuable upon conversion of this Note (other than a subdivision,
      combination, reclassification, or exchange of shares provided for
      elsewhere) or a merger or consolidation of the Company with or into
      another corporation, or the sale of all or substantially all of the
      Company’s properties and assets to any other entity, then, as a part of
      such reorganization, merger, consolidation, or sale, provision shall be
      made so that the Holder shall thereafter be entitled to receive upon
      conversion of this Note, the number of shares of capital stock or other
      securities or property of the Company, or of the successor corporation
      resulting from such merger or consolidation or sale, to which a holder of
      Common Stock deliverable upon conversion would have been entitled on such
      capital reorganization, merger, consolidation, or sale. In any such case,
      appropriate adjustment shall be made in the application of the provisions
      of this Note with respect to the rights of the Holder after the
      reorganization, merger, consolidation, or sale to the end that the
      provisions of this Note shall be applicable after the event as nearly
      equivalent as may be practicable.

            


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (d)

            	
              Adjustment for Stock
      Splits and Combinations.  If the Company at any time or
      from time to time effects a subdivision of the outstanding capital stock,
      the Conversion Price then in effect immediately before that subdivision
      shall be proportionately decreased, and conversely, if the Company at any
      time or from time to time combines the outstanding shares of capital
      stock, the Conversion Price then in effect immediately before the
      combination shall be proportionately increased. Any adjustment under this
      subsection (d) shall become effective at the close of business on the date
      the subdivision or combination becomes
  effective.

            


    

     

    SECTION
2
Restrictions
of Transfer

     

    Section
2.1 No
Transfer.  No transfer of this Note may be completed unless and
until (i) the Company has received an opinion of counsel for the Company that
such securities may be sold pursuant to an exemption from registration under the
Securities Act of 1933, as amended (the "Securities Act"), or
(ii) a registration statement relating to  the shares underlying the
conversion rights of this Note has been filed by the Company and declared
effective by the Commission.  Subject to the foregoing, this Note and
all rights hereunder are transferable, in whole or in part, at the principal
office of the Company by the Holder in person or by duly authorized attorney,
upon surrender of this Note properly endorsed to any person or entity who
represents in writing that he/she/it is acquiring the Note for investment and
without any view to the sale or other distribution thereof.  Each
Holder of this Note, by taking or holding the same, consents and agrees that the
bearer of this Note, when endorsed, may be treated by the Company and all other
persons dealing with this Note as the absolute owner hereof for any purpose and
as the person entitled to exercise the rights represented by this Note or
perform the obligations required hereby, or to the transfer hereof on the books
of the Company, any notice to the contrary notwithstanding; but until such
transfer on such books, the Company may treat the registered owner hereof as the
owner for all purposes.

     

    Section
2.2 Legend.  Each
certificate for shares issued upon the exercise of the rights represented by
this Note shall bear a legend as follows unless, in the opinion of counsel to
the Company, such legend is not required in order to ensure compliance with the
Securities Act:

     

    "THE
SECURITIES EVIDENCED BY THIS CERTIFICATE WERE ISSUED, AND THE SECURITIES
ISSUABLE IN CONNECTION WITH THE CONVERSION OF SUCH SECURITIES WILL BE ISSUED, IN
A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND APPLICABLE STATE SECURITIES LAWS, AND IN RELIANCE UPON THE HOLDER’S
REPRESENTATION THAT SUCH SECURITIES WERE BEING ACQUIRED FOR INVESTMENT AND NOT
FOR RESALE.  NO TRANSFER OF THE SECURITIES OR THE SECURITIES ISSUABLE
IN CONNECTION WITH THE CONVERSION OF SUCH SECURTITIES MAY BE MADE ON THE BOOKS
OF THE COMPANY UNLESS (i) SUCH TRANSFER IS MADE PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
APPLICABLE STATE SECURITIES LAWS OR (ii) UNLESS THE HOLDER SHALL HAVE PROVIDED
THE COMPANY WITH AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY TO
THE EFFECT THAT NO SUCH REGISTRATION IS REQUIRED."

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    SECTION
3
Events of
Default

     

    Section
3.1 Events of
Default.   The entire outstanding principal amount of this
Note, together with all interest accrued thereon (such principal and accrued
interest, the “Outstanding Balance”)
shall become due and payable without any action on the part of the Holder
thereof upon the happening of any of the following events (each, an “Event of
Default”):

     

    
      	 	
              (a)

            	
              the
      Company shall generally not pay its debts as such debts become due, or
      shall admit in writing its inability to pay its debts generally, or shall
      make a general assignment for the benefit of creditors; or any proceeding
      shall be instituted by or against the Company seeking to adjudicate it
      bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
      arrangement, adjustment, custodianship, protection, or relief of it or its
      debts under any law relating to bankruptcy, insolvency or reorganization
      or relief of debtors, or seeking the entry of an order for relief or the
      appointment of a receiver, custodian trustee, or other similar official
      for it or for any substantial part of its property;
  or

            


    

     

    
      	 	
              (b)

            	
              the
      Company shall default in the due performance or observance of any
      expressed or implied covenant, agreement or provision of this Note and
      such default shall have continued uncured for a period of sixty (60) days
      after written notice thereof to the Company from the
    Holder.

            


    

     

    Section
3.2 Suits for
Enforcement.  In case any one or more Events of Default shall
have occurred and be continuing, unless such Events of Default shall have been
waived,  the Holder may proceed to protect and enforce his rights
under this Section 3.2 by suit in equity or action at law.  It is
agreed that in the event the Holder prevails in such action, the Holder shall be
entitled to receive all reasonable fees, costs and expenses incurred, including
without limitation such reasonable fees and expenses of attorneys (whether or
not litigation is commenced) and reasonable fees, costs and expenses of
appeals.

     

    SECTION
4
Miscellaneous

     

    Section
4.1 No rights as
Shareholder.  This Note shall not entitle the Holder to any
voting rights or other rights as a shareholder of the Company.

     

    Section
4.2 Lost, Stolen or Mutilated
Notes.  Upon receipt of evidence satisfactory to the Company of
the loss, theft, destruction or mutilation of this Note, and in case of any such
loss, theft or destruction, upon delivery of any customary indemnity agreement
reasonably satisfactory to the Company, or in any case of any such mutilation,
upon surrender and cancellation of this Note, the Company at its expense will
issue and deliver a new Note of like tenor in an amount equal to the amount of
such lost, stolen or mutilated Note and any such lost, stolen or destroyed Note
shall thereupon become void.

     

    Section
4.3 Benefit of
Note.  This Note shall be binding upon, and shall inure to the
benefit of and be enforceable by, the Holder and his successors and
assigns.  All of the covenants and the agreements contained in this
Note by or on behalf of the Company are binding on the Company’s successors and
assigns, whether by consolidation, merger, transfer or license of all or
substantially all of the property of the Company.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Section
4.4 Costs of
Collection.  The Company hereby waives presentment for payment,
notice of dishonor, protest and notice of protest and, following an Event of
Default, the Company shall pay all of the Holder’s costs of collecting or
attempting to collect any amount due hereunder, including but not limited to,
all reasonable attorneys’ fees and legal expenses.

     

    Section
4.5 Notices.  All
notices required under this Note shall be deemed to have been given or made for
all purposes (i) upon personal delivery, (ii) upon confirmation
receipt that the communication was successfully sent to the applicable number if
sent by facsimile; (iii) one day after being sent, when sent by
professional overnight courier service, or (iv) five days after posting
when sent by registered or certified mail.  Notices to the Company
shall be sent to the principal office of the Company (or at such other place as
the Company shall notify the Holder hereof in writing).  Notices to
the Holder shall be sent to the address of the Holder as set forth in the books
and records of the Company on the date hereof (or at such other place as the
Holder shall notify the Company hereof in writing).

     

    Section
4.6 Amendment;
Waiver.  Any term of this Note may be amended, changed or
modified, and the observance of any term of this Note may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the
Holder.

     

    Section
4.7 Governing Law and
Construction.  This Note shall be construed in accordance with
and governed by the laws of the State of Minnesota, without regard to the
principles of conflicts of law.  Whenever possible, each provision of
this Note and any other statement, instrument or transaction contemplated hereby
and valid under such applicable law, but, if any provision of this Note or any
other statement, instrument or transaction contemplated hereby or relating
hereto shall be held to be prohibited or invalid under such applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note or any other statement, instrument or
transaction contemplated hereby or relating hereto.

     

    IN WITNESS WHEREOF, the
Company has executed this Note as of the date first above written.

     

     

    
      
        	 	

                PROUROCARE
      MEDICAL INC.

              	 
	 	 	 	 
	
                 

              	
                By:
      

              	/s/ Richard
      C. Carlson	 
	 	 	Name: Richard
      C. Carlson	 
	 	 	Title: Chief
      Executive Officer