Document:

Unassociated Document

    EXHIBIT
      10.26

    

    

    LICENSE
      AGREEMENT

    

    THIS
      LICENSE AGREEMENT (this "Agreement") is made as of April 15, 2008 (the
“Effective Date”) by and between Hybrid Technologies, Inc., a Nevada corporation
      having an address at 5841 East Charleston, Suite 230-145, Las Vegas, NV 89142
      ("Hybrid"), and Zingo Inc., a Nevada corporation having an address at 420 N.
      Nellis Blvd., Suite A3-146, Las Vegas, NV 89110. ("Zingo").

    RECITALS

    WHEREAS,
      Hybrid owns and has the right to license the Patent Rights (defined below);
      

    WHEREAS,
      Hybrid desires to exclusively license to Zingo, and Zingo desires to obtain
      a
      license from Hybrid to, the Patent Rights; 

    NOW,
      THEREFORE, the parties agree:

    

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    ARTICLE
      1.

    DEFINITIONS

    

    The
      terms, as defined herein, shall have the same meanings in both their singular
      and plural forms.

    1.1     “Affiliate”
      means any corporation or other business entity in which Zingo owns or controls,
      directly or indirectly, more than fifty percent (50%) of the outstanding stock
      or other voting rights entitled to elect directors, or in which Zingo is owned
      or controlled directly or indirectly by more than fifty percent (50%) of the
      outstanding stock or other voting rights entitled to elect directors.

    1.2      “Licensed
      Field” means rechargeable lithium-ion batteries for hybrid vehicles and other
      applications.

    1.3     “Licensed
      Product” means any product for which the manufacture, use, sale, offer for sale,
      or importation would constitute, but for the license granted to Zingo by Hybrid
      herein, an infringement of any Valid Claim within the Patent
      Rights.

    1.4     “Patent
      Rights” means any and all patents and patent applications (including inventor's
      certificates and utility models) listed on Exhibit A, including any
      substitutions, extensions, reissues, reexaminations, renewals, divisions,
      continuations, continuation-in-parts and foreign counterparts of any of the
      foregoing.

    1.5     “Retained
      Field” means any products outside of the Licensed Field.

    1.6      “Valid
      Claim”
means any patent claim within the Patent Rights that has not expired or been
      held invalid in a final decision by a patent office or by a court of competent
      jurisdiction.

    ARTICLE
      2.

    GRANT

    2.1     License.
      Hybrid hereby grants to Zingo, and Zingo hereby accepts, a worldwide, exclusive,
      perpetual license, under the Patent Rights, to make, use, sell, offer for sale
      and import Licensed Products and practice any methods covered by the Patent
      Rights, solely within the Licensed Field. Zingo shall have the right to
      sublicense under this Agreement only with (i) the consent of Hybrid and (ii)
      Hybrid’s approval of the terms of each such sublicense.

    2.2     Developmental
      Capital. Zingo shall invest not less than One Million Five Hundred Thousand
      Dollars ($1,500,000) in the development of the Licensed Products in each of
      the
      first two years after the Effective Date, for a total investment of not less
      than Three Million Dollars ($3,000,000) in the first two years after the
      Effective Date.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    2.3     Delivery.
      Hybrid will deliver to Zingo tangible examples and prototypes of the Patent
      Rights in the Licensed Field, including any schematics, diagrams, designs and
      molds, held by Hybrid. 

    

    ARTICLE
      3.

    PREFERENTIAL
      PURCHASE RIGHTS AND PRICING; LEASE

    3.1     Preferential
      Purchaser. Hybrid shall have the right to purchase its requirements of lithium
      ion batteries from Zingo. Hybrid’s requirements of lithium ion batteries shall
      be supplied to Hybrid in preference to, and on a priority basis as compared
      with, supply and delivery arrangements in effect for other customers of
      Zingo.

    3.2     Sales
      at
      Cost. Hybrid’s cost for lithium ion batteries purchased from Zingo shall be
      Zingo’s actual manufacturing costs for such batteries for the fiscal quarter of
      Zingo in which Hybrid’s purchase takes place. Hybrid shall have the right to
      audit Zingo’s manufacturing costs as provided in Article 4.

    3.3     Lease.
      Effective April 16, 2008, Zingo will lease approximately 5,000 square feet
      of
      space (“Leased Space”) in Hybrid’s North Carolina facility, such Leased Space to
      be suitable for, and utilized by Zingo for, Zingo’s developmental and
      manufacturing operations for Licensed Products pursuant to this Agreement.
      The
      Leased Space shall be leased by Hybrid to Zingo on a month-to-month basis at
      a
      monthly rental of $2,500, the monthly rental to be escalated five (5%) percent
      annually.

    3.4      Sale
      of
      Equipment and Supplies. Effective April 16, 2008, Hybrid shall sell to Zingo
      for
      the purchase price of $29,005, and Hybrid hereby assigns, transfers and sells
      to
      Zingo, the equipment and supplies related to the Licensed Field listed on
      Exhibit B hereto.

    ARTICLE
      4.

    AUDIT
      RIGHTS

    4.1 Records
      & Audits.

    (a) Zingo
      shall use reasonable efforts to keep accurate and correct records of all
      Licensed Products manufactured, used, and sold, and sublicense fees received
      under this Agreement. Such records shall be retained by Zingo for at least
      two
      (2) years following a given reporting period.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    (b) All
      records of Zingo and its Affiliates and Sublicensees shall be available during
      normal business hours for inspection at the expense of Hybrid by a nationally
      recognized certified public accountant selected by Hybrid and acceptable to
      Zingo for the sole purpose of pricing of lithium batteries to Hybrid. Such
      inspector shall not disclose to Hybrid any information other than information
      relating to the accuracy of reports and payments made under this Agreement
      or
      other compliance issues. In the event that any such inspection shows an
      overcharge to Hybrid in excess of ten percent (10%) for any twelve (12) month
      period, then Zingo shall pay the cost of the audit as well as any additional
      sum
      that would have been not been payable by Hybrid had Zingo priced lithium ion
      batteries sold to Hybrid correctly.

    

    ARTICLE
      5. 

    PATENT
      MATTERS

    5.1 Patent
      Prosecution and Maintenance.

    (a)     Zingo
      shall have the right to control, at its expense and with counsel of Zingo’s
      choice, the prosecution and maintenance of the Patent Rights as they pertain
      to
      the Licensed Field (the “Licensed Field Patent Rights”). Hybrid shall provide
      Zingo with copies of all relevant documentation relating to such prosecution.
      Hybrid shall cooperate in good faith and use diligent efforts to support Zingo’s
      prosecution and maintenance activities.

    (b)     Hybrid
      agrees that if Zingo is unable because of Hybrid’s unavailability, dissolution
      or for any other reason to secure any signatures in connection with the
      prosecution and maintenance of the Licensed Field Patent Rights, then Hybrid
      hereby irrevocably designates and appoints Zingo and its duly authorized
      officers and agents as Hybrid’s agent and attorney in fact, to act for and in
      Hybrid’s behalf and stead to execute and file any documents and to do all other
      lawfully permitted acts to further the prosecution, issuance and maintenance
      of
      the Licensed Field Patent Rights with the same legal force and effect as if
      executed by Hybrid.

    (c)     In
      the
      event Zingo desires to terminate or cease maintenance of any Licensed Field
      Patent Rights, it shall notify Hybrid, and Hybrid shall have the opportunity
      to
      control, at its expense, the prosecution and maintenance of such Licensed Field
      Patent Rights. 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    (d)     Hybrid
      will promptly provide to Zingo copies of all existing files and records
      pertaining to the Licensed Field Patent Rights, including without limitation
      all
      office actions, drafts, receipts, drawings, correspondence, disclosures, models,
      copies, prototypes, diagnostic reports, prior art and analyses. 

    5.2 Patent
      Infringement.

    (a)     Each
      party
      shall notify the other party in writing of any suspected infringements of the
      Patent Rights.

    (b)     Zingo
      shall have the right, but not the obligation, to institute and control the
      prosecution of a suit or to take any other action for any of the Licensed Field
      Patent Rights. Hybrid agrees to take no action with respect to any third-party
      infringement of Licensed Field Patent Rights unless expressly authorized to
      do
      so in writing by Zingo. Hybrid agrees to cooperate with Zingo in all respects,
      to make employees of Hybrid available to testify, and to join in any such suit
      as a voluntary plaintiff, upon Zingo’s request. 

    (c)     Any
      recovery or settlement obtained as a result of such suit or other action shall
      be retained by Zingo, and Hybrid shall have no rights whatsoever in any such
      recovery or settlement, except that any such recovery or settlement shall be
      treated as a reduction in Zingo’s manufacturing costs, for purposes of
      calculating sale prices of lithium ion batteries to Hybrid, after deduction
      of
      costs and expenses incurred by Zingo in bringing and controlling any such suit
      or action.

    (d)     In
      the
      event the suspected infringement is in the Retained Field, then the parties
      shall discuss in good faith and strategize regarding the institution and
      prosecution of a suit or other action.

    5.3     New
      Inventions. Zingo shall have all rights, title and interest in and to any
      improvements or modifications to the Patent Rights only as they pertain to
      any
      inventions within the Licensed Field that are conceived, reduced to practice
      or
      otherwise invented by or for Hybrid (the “Licensed Field Improvements”) during
      the term of this Agreement. Hybrid hereby makes any assignments to accomplish
      the foregoing ownership provision. Hybrid agrees to assist Zingo in every proper
      way (including, without limitation, becoming a nominal party) to evidence,
      record and perfect the assignment and to apply for and obtain recordation of
      and
      from time to time enforce, maintain and defend such proprietary right. In the
      event it is not practical or feasible to assign rights within the Licensed
      Field
      separate from rights in the Retained Field, then Hybrid hereby grants to Zingo
      an exclusive, perpetual, irrevocable, royalty-free, sublicensable license to
      practice and exploit the Licensed Field Improvements.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    5.4  Retained
      Field. Hybrid shall continue as responsible for all research and development
      relating to the Patent Rights and shall retain all rights, title and interest
      in
      and to the Patent Rights, or any improvements or modifications to the Patent
      Rights only as they pertain to any inventions within the Retained Field that
      are
      conceived, reduced to practice or otherwise invented by or for Tru-Light (the
      during the term of this Agreement (the “Retained Field Patent Rights”). Zingo
      hereby makes any assignments to accomplish the foregoing ownership provision.
      Zingo agrees to assist Hybrid in every proper way (including, without
      limitation, becoming a nominal party) to evidence, record and perfect the
      assignment and to apply for and obtain recordation of and from time to time
      enforce, maintain and defend such proprietary right. In the event it is not
      practical or feasible to assign rights within the Retained Field separate from
      rights in the Licensed Field, then Zingo hereby grants to Hybrid an exclusive,
      perpetual, irrevocable, royalty-free, sublicensable license to practice and
      exploit such Retained Field Patent Rights.

    

    ARTICLE
      6.

    TERMINATION
      OF THE AGREEMENT

    6.1     Term.
      Unless terminated earlier in accordance with this Article, this Agreement shall
      be effective beginning on the Effective Date and ending on the expiration date
      of the longest-lived Valid Claim.

    6.2     Termination
      by Hybrid. If Zingo materially fails to perform or materially violates any
      term
      of this Agreement, then Hybrid may give written notice of default ("Notice
      of
      Default") to Zingo. If a Notice of Termination is sent to Zingo, this Agreement
      shall automatically terminate on the effective date of that notice.

    6.3     Termination
      by Zingo. Zingo shall have the right at any time and for any reason, or no
      reason at all, to terminate this Agreement upon a ninety (90) day written notice
      to Hybrid. Said notice shall state Zingo’s reason for terminating this
      Agreement.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    6.4     Survival
      on
      Termination. Articles 4,5, 6 and 8 shall survive the termination or expiration
      of this Agreement. 

    6.5     Disposition
      of Licensed Products on Hand. Upon termination of this Agreement, Zingo shall
      return to Hybrid any tangible examples and prototypes of the Patent Rights
      in
      the Licensed Field, including any schematics, diagrams, designs and molds
      delivered to Zingo by Hybrid pursuant to Section 2.3, and Zingo, its Affiliates
      and Sublicensees may dispose of all previously made or partially made Licensed
      Product within a period of one hundred and twenty (120) days of the effective
      date of such termination provided that the sale of such Licensed Product by
      Zingo, its Sublicensees, or Affiliates shall be subject to the terms of this
      Agreement.

    6.6     Treatment
      of Sublicenses. Hybrid shall in good faith cooperate with Zingo to provide
      comfort to any Zingo sublicenses of the consequences of the termination of
      this
      Agreement. 

    

    

    ARTICLE
      7.

    REPRESENTATIONS
      AND WARRANTY

    7.1     Representations
      and Warranties.

    (a)     Hybrid
      represents and warrants:

    (1)     that
      it
      is the sole owner of the Patent Rights and has the lawful right to grant this
      license;

    (2)     that
      none
      of the Patent Rights are the subject of any pending interference, opposition,
      cancellation or other challenge or adversarial proceeding;

    (3)     it
      has
      neither assigned nor granted any license or other rights to the Patent Rights
      and it is under no obligation to grant any such license or rights to any third
      party;

    (4)     there
      are
      no outstanding liens, encumbrances, third party rights, agreements or
      understandings of any kind, either written, oral or implied, regarding the
      Patent Rights which are inconsistent or in conflict with any provision of this
      Agreement; and

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    (5)     the
      execution and delivery of this Agreement, and the performance by Hybrid of
      its
      obligations hereunder have been duly authorized by all necessary corporate
      or
      other action on the part of Hybrid, and no consents, waivers, or permissions
      that have not already been granted are required for such actions. 

    7.2 HYBRID
      HEREBY DISCLAIMS ANY IMPLIED WARRANTIES WITH RESPECT TO THE PATENT RIGHTS,
      INCLUDING WITHOUT LIMITATION ANY WARRANTY OF MERCHANTABILITY OR WARRANTY OF
      FITNESS FOR A PARTICULAR PURPOSE.

    

    ARTICLE
      8.

    MISCELLANEOUS
      PROVISIONS

    8.1     Correspondence.
      Any notice or payment required to be given to either party under this Agreement
      shall be deemed to have been properly given and effective: 

    (a)     on
      the
      date of delivery if delivered in person, or

    (b)     five
      (5)
      days after mailing if mailed by first-class or certified mail, postage paid,
      to
      the parties’ respective addresses set forth above, attention: President, or to
      such other address as is designated by written notice given to the other
      party.

    

    8.2     Assignability.
      Except
      as otherwise expressly provided under this Agreement, neither this Agreement
      nor
      any right or obligation hereunder may be assigned or otherwise transferred
      (whether voluntarily, by operation of law or otherwise) by either party, without
      the prior express written consent of the other party; provided, however, that
      either party may, without such consent, assign this Agreement and its rights
      and
      obligations hereunder in connection with the transfer or sale of all or
      substantially all of its business, whether through merger, reorganization or
      otherwise. In the event Hybrid determines to transfer any of the Patent Rights
      to any entity, Hybrid must notify such entity, and such entity must acknowledge,
      that the Patent Rights are subject to this Agreement.

    8.3 No
      Waiver. No waiver by either party of any breach or default of any covenant
      or
      agreement set forth in this Agreement shall be deemed a waiver as to any
      subsequent and/or similar breach or default.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    8.4 
      Separate
      Counsel for Zingo. Zingo Acknowledges and represents that it has been advised
      by
      its counsel as to this Agreement and has not been represented by Jackson &
Campbell, P.C.

    8.5  Failure
      to Perform. In the event of a failure of performance due under this Agreement
      and if it becomes necessary for either party to undertake legal action against
      the other on account thereof, then the prevailing party shall be entitled to
      reasonable attorney's fees in addition to costs and necessary
      disbursements.

    8.6  Governing
      Laws. THIS AGREEMENT SHALL BE INTERPRETED AND CONSTRUED IN ACCORDANCE WITH
      THE
      LAWS OF THE STATE OF NEVADA, without regard to the conflicts of laws principles
      thereof, but the scope and validity of any patent or patent application shall
      be
      governed by the applicable laws of the country of the patent or patent
      application. 

     

    8.7  Force
      Majeure. A party to this Agreement may be excused from any performance required
      herein if such performance is rendered impossible or unfeasible due to any
      catastrophe or other major event beyond its reasonable control, including,
      without limitation, war, riot, and insurrection; laws, proclamations, edicts,
      ordinances, or regulations; strikes, lockouts, or other serious labor disputes;
      and floods, fires, explosions, or other natural disasters. When such events
      have
      abated, the non-performing party's obligations herein shall resume.

    8.8  Headings.
      The headings of the several sections are inserted for convenience of reference
      only and are not intended to be a part of or to affect the meaning or
      interpretation of this Agreement.

    8.9  Entire
      Agreement. This Agreement embodies the entire understanding of the parties
      and
      supersedes all previous communications, representations or understandings,
      either oral or written, between the parties relating to the subject matter
      hereof.

    8.10  Amendments.
      No amendment or modification of this Agreement shall be valid or binding on
      the
      parties unless made in writing and signed on behalf of each party.

    8.11  Severability.
      In the event that any of the provisions contained in this Agreement is held
      to
      be invalid, illegal, or unenforceable in any respect, such invalidity,
      illegality or unenforceability shall not affect any other provisions of this
      Agreement, and this Agreement shall be construed as if the invalid, illegal,
      or
      unenforceable provisions had never been contained in it.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    IN
      WITNESS WHEREOF, both Hybrid and Zingo have executed this Agreement, in
      duplicate originals, by their respective and duly authorized officers on the
      day
      and year written.

     

    
      	Zingo, Inc.:	 	Hybrid Technologies, Inc.	 
	/s/ Mehboob Charania	 	/s/ Holly Roseberry	 
	By__________________________	 	By__________________________	 
	
              (Signature)

            	 	
              (Signature)

            	 
	Name: Mehboob Charania 	 	Name: Holly Roseberry	 
	Title: Secretary	 	Title: Chief Executive Officer	 

    

         

     

    EXHIBIT
      A

    List
      of
      Patents and Patent Applications

    

    22854-002-
      “Rechargeable Battery Cathode Material”- PTO assigned application # 60/947,168
      with a filing date of 06/29/2007- Inventor Sengupta, Surajit

     

    EXHIBIT
      B

    Equipment
      and Supplies to be Purchased from Hybrid Technologies, Inc.

    

    

    
      	Date	Vendor	Amount	PO #	Equipment and Supplies
	 	 	 	 	 
	4/25/07	AHL Machinery Corp	$21,750.00	1159	mixer, temperature control
              system
	10/19/07	Alfa Aesar	$2,505.00	1186	titanium, polyvinyl alcohol
	 	 	$4,750	 	electric hook up
	Total	 	$29,005.00EXHIBIT
      A 

     

    FORM
      OF SUBORDINATED SECURED CONVERTIBLE DEBENTURE 

     

    THE
      SECURITIES REPRESENTED BY THIS SUBORDINATED SECURED CONVERTIBLE DEBENTURE HAVE
      NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
      APPLICABLE STATE SECURITIES LAWS. ANY TRANSFER OF SUCH SECURITIES WILL BE
      INVALID UNLESS A REGISTRATION STATEMENT UNDER THE ACT AND AS REQUIRED BY BLUE
      SKY LAWS IS IN EFFECT AS TO SUCH TRANSFER OR IN THE OPINION OF COUNSEL
      SATISFACTORY TO THE COMPANY SUCH REGISTRATION IS UNNECESSARY IN ORDER FOR SUCH
      TRANSFER TO COMPLY WITH THE ACT AND BLUE SKY LAWS. 

     

    Airbee
      Wireless, Inc. 

     

    12%
      SUBORDINATED SECURED CONVERTIBLE DEBENTURE 

     

    $465,000
      April 15, 2008 

     

    FOR
      VALUE
      RECEIVED, subject to the terms and conditions of this 12% Subordinated Secured
      Convertible Debenture (the “Debenture”),
      Airbee Wireless, Inc., a Delaware corporation with its principal offices located
      at 9400
      Key
      West Avenue, Rockville, Maryland 20850 (the “Company”),
      hereby promises to pay to the order of Richard P. Sommerfeld, Jr. (the
“Holder”),
      the
      principal sum of 

     

    Four
      Hundred Sixty-five Thousand U.S. Dollars ($465,000.00) (the “Face
      Amount”),
      or
      such lesser amount as remains outstanding after any conversions pursuant to
      the
      terms set forth below, upon demand made by the Holder at any time on or after
      the date which is two (2) years from the date of this Debenture, in lawful
      money of the United States and in immediately available funds (the “Maturity
      Date”).
      

     

    This
      Debenture is being issued pursuant to that certain Settlement Agreement of
      even
      date herewith (the “Settlement
      Agreement”)
      entered into by the Holder with the Company and this Debenture is subject to
      the
      Settlement Agreement, which together with this Debenture, sets forth the
      respective rights and obligations of the Holder and the Company with respect
      to
      this Debenture. Terms not defined herein shall have the meaning ascribed to
      them
      in the Settlement Agreement. If there is any conflict between the terms of
      the
      Settlement Agreement and this Debenture, the Settlement Agreement shall govern,
      subject in each case to the terms set forth in the Intercreditor Agreement
      (as
      defined below). Subject to the terms of the Intercreditor Agreement, if this
      Debenture is silent as to any term, the terms of the Settlement Agreement shall
      govern. 

     

    1. Interest.
      Subject
      to the terms and conditions of this Debenture, the Company also promises to
      pay
      to the Holder interest accrued on the outstanding unpaid principal amount hereof
      until such principal amount is paid at the rate of twelve percent (12%) per
      annum. Accrued but unpaid interest shall be paid in quarter-annual installments,
      commencing on the last day of the calendar quarter ending June 30, 2008,
      and on the last day of each calendar quarter thereafter, until this Note has
      been paid in full in accordance with the terms hereof. Interest may be paid,
      at
      the option of the Company, in cash or in shares of common stock of the Company,
      par value $0.00004 per share (“Common
      Stock”),
      at a
      price per share of Common Stock equal to 80% of the average of the volume
      weighted average price of the Common Stock for the preceding five (5) days
      on which the Common Stock is traded on the trading market on which the Common
      Stock is then listed or quoted for trading (for example, the OTC Bulletin Board,
      Pink Sheets published by Pink Sheets, LLC, the American Stock Exchange, or
      the
      Nasdaq National Market) as reported by a generally accepted reporting service
      such as Bloomberg PC. 

     

    2. Prepayment.
      The
      Debenture may be paid in whole or in part prior to the Maturity Date without
      premium or penalty upon notice by the Company to the lder, which prepayment
      notice shall be deemed effective as of the date of its issuance.

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    3. Conversion.
      

     

    (a) Conversion
      Mechanics.
      Upon
      any conversion of this Debenture pursuant to Section 3(b), this Debenture will
      convert into the number of shares of Common Stock obtaining by dividing
      (x) that portion of the Face Amount being converted, and all accrued and
      unpaid interest thereon as of the date of conversion, by (y) $0.05 (the
“Conversion
      Price”).
      The
      Conversion Price shall be subject to adjustment as set forth in Section 4
      below. 

     

    (b) Holder’s
      Option to Convert.
      The
      Holder shall have the right, but not the obligation, from time to time to
      convert all or any portion of the issued and outstanding Face Amount and accrued
      but unpaid interest thereon into fully paid and non-assessable shares of Common
      Stock at the Conversion Price. 

     

    (c) Mechanics
      of Holder’s Conversion.
      In the
      event that the Holder elects to convert all or any part of this Debenture into
      Common Stock, the Holder shall give notice of such election by delivering an
      executed and completed notice of conversion in substantially the form attached
      hereto as Exhibit I
      (the
“Notice
      of Conversion”)
      to the
      Company on or before each Conversion Date (as defined below) and such Notice
      of
      Conversion shall provide a breakdown in reasonable detail of the Face Amount
      and
      accrued but unpaid interest thereon that are being converted. In addition,
      concurrently with providing the Notice of Conversion to the Company, and in
      accordance with its Notice of Conversion, the Holder shall make the appropriate
      reduction to the outstanding Face Amount and accrued and unpaid interest thereon
      as entered in its records and shall provide written notice of such adjustment
      to
      the Company. Each date on which a Notice of Conversion is delivered or
      telecopied to the Company in accordance with the provisions hereof shall be
      deemed a Conversion Date (the “Conversion
      Date”).
      Pursuant to the terms of the Notice of Conversion, the Company will issue,
      within two (2) business days following a Conversion Date, instructions to
      the transfer agent, accompanied by an opinion of counsel, to issue to the Holder
      certificates representing the Conversion Shares (as hereinafter defined) and
      shall cause the transfer agent to transmit the certificates representing the
      Conversion Shares to the Holder within five (5) business days thereafter.
      In the case of the exercise of the conversion rights set forth herein, the
      conversion privilege shall be deemed to have been exercised and the Conversion
      Shares issuable upon such conversion shall be deemed to have been issued upon
      the date of receipt by the Company of the Notice of Conversion. The Holder
      shall
      be treated for all purposes as the record holder of the Conversion Shares,
      unless the Holder provides the Company written instructions to the contrary.
      

     

    (d) Reservation
      of Shares.
      During
      the period the conversion right exists, the Company will reserve from its
      authorized and unissued Common Stock a sufficient number of shares to provide
      for the issuance of Conversion Shares upon the conversion of all or any part
      of
      this Debenture (the “Conversion
      Shares”).
      

     

    (e) No
      Fractional Shares.
      No
      fractional shares of Common Stock will be issued upon conversion of this
      Debenture. In lieu of any fractional shares to which the Holder would otherwise
      be entitled, the Company will pay the Holder in cash the amount of the
      unconverted Face Amount and accrued and unpaid interest, if any, which would
      otherwise be converted into such fractional shares. 

     

    (f) Release.
      Upon
      full conversion of this Debenture and payment of all cash amounts due to the
      Holder as provided in this Debenture, if any, the Company will forever be
      released from all of its payment obligations relating to the Face Amount of
      this
      Debenture and any accrued and unpaid interest thereon. 

     

    4. Conversion
      Price Adjustment.
      The
      Conversion Price shall be subject to adjustment from time to time as follows:
      

     

    (a) Subdivisions,
      Combinations and Other Issuances.
      If the
      Company shall at any time prior to the Maturity Date subdivide its Common Stock,
      by split-up or otherwise, or combine its Common Stock, or issue additional
      shares of its Common Stock as a dividend with respect to any shares of its
      Common Stock, then the Conversion Price in effect prior to such event shall
      be
      proportionately decreased or increased, as appropriate. Any adjustment under
      this Section 4(a) shall become effective at the close of business on the date
      the subdivision or combination becomes effective, or as of the record date
      of
      such dividend, or in the event that no record date is fixed, upon the making
      of
      such dividend. 

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (b) Reclassification,
      Reorganization, Consolidation, Merger and Other Changes.
      In case
      of any reclassification, capital reorganization or change in the Common Stock
      of
      the Company (other than as a result of a subdivision, combination, or stock
      dividend provided for in Section 4(a)), or consolidation or merger of the
      Company with or into another corporation, or the sale of all or substantially
      all of its assets to another corporation shall be effected in such a way that
      holders of the Company’s Common Stock shall be entitled to receive stock,
      securities or assets with respect to or in exchange for such Common Stock (a
      “Change”),
      then,
      as a condition of Change, lawful provision shall be made, and duly executed
      documents evidencing the same from the Company or its successor shall be
      delivered to the Holder, so that the Holder shall have the right at any time
      prior to the Maturity Date to receive upon conversion of this Debenture, the
      kind and amount of shares of stock and other securities and property receivable
      in connection with such Change that a holder of Common Stock would be entitled
      to receive in such Change. In any such case appropriate provisions shall be
      made
      with respect to the rights and interest of the Holder so that the provisions
      hereof shall thereafter be applicable with respect to any shares of stock or
      other securities and property deliverable upon conversion including adjustment
      of the Conversion Price. 

     

    5. Subordination
      of Obligations and Liens Under Intercreditor Agreement.
      The
      Obligations and all liens, security interests and other encumbrances of any
      nature (including judgment liens) granted to Holder hereunder or under the
      Settlement Agreement, or otherwise held at any time by Holder in and to the
      Pledged Property are subordinated in right and priority of payment to the Senior
      Debt (as defined in and provided for pursuant to that certain Intercreditor
      Agreement (the “Intercreditor
      Agreement”),
      dated
      as of April      ,
      2008,
      by and among the Company, each Senior Creditor (as defined therein) party
      thereto, and the Holder). Notwithstanding any provision in the Settlement
      Agreement, this Subordinated Debenture or any other document to the contrary,
      all of Holder’s rights and remedies with respect to the Obligations or any other
      indebtedness owing by the Company to the Holder are subject in all respect
      to
      the terms of the Intercreditor Agreement. In the event of any conflict or
      inconsistency between the terms of the Settlement Agreement, the Debenture
      or
      any other agreement or law with respect to issues governed by the Intercreditor
      Agreement, the terms of the Intercreditor Agreement shall control to the full
      extent permitted by applicable law. 

     

    6. Events
      of Default.
      

     

    (a) An
      “Event
      of Default”,
      wherever used herein, means any one of the following events: 

     

    (i) Any
      default in the payment of the principal of, interest on or other charges in
      respect of this Debenture, free of any claim of subordination, as and when
      the
      same shall become due and payable (whether on a scheduled quarterly payment
      date, at maturity or by acceleration); 

     

    (ii) The
      Company shall fail to observe or perform any other covenant, agreement or
      warranty contained in, or otherwise commit any breach or default of any
      provision of this Debenture or the Settlement Agreement, which is not cured
      with
      in the time prescribed; 

     

    (iii) The
      Company shall commence, or there shall be commenced against the Company under
      any applicable bankruptcy or insolvency laws, or the Company commences any
      other
      proceeding under any reorganization, arrangement, adjustment of debt, relief
      of
      debtors, dissolution, insolvency or liquidation or similar law of any
      jurisdiction relating to the Company or there is commenced against the Company
      any such bankruptcy, insolvency or other proceeding which remains un-dismissed
      for a period of 31 days; or the Company is adjudicated insolvent or
      bankrupt; or the Company makes a general assignment for the benefit of
      creditors; or the Company shall fail to pay its debts generally as they become
      due; 

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (iv) The
      Common Stock shall cease to be quoted for trading or listed for trading on
      either the NASDAQ OTC Bulletin Board (“OTC”),
      NASDAQ SmallCap Market, New York Stock Exchange, American Stock Exchange or
      the
      NASDAQ National Market and shall not again be quoted or listed for trading
      thereon within ten (10) trading days of such delisting; or 

     

                
(v) The
      Senior
      Creditors (as defined in the Intercreditor Agreement) shall have issued a
      written notice to the Company asserting the existence or occurrence of an Event
      of Default under the Senior Debentures (as defined in the Intercreditor
      Agreement); provided,
      however,
      that
      immediately upon the Company’s delivery to the Holder of written evidence of the
      Senior Creditors’ recission, withdrawal, waiver, acknowledgment of the cure of,
      or agreement to forebear with respect to any such noticed Event of Default
      under
      the Senior Debenture, any Event of Default occurring or existing under this
      Debenture as the result of the operation of this clause (v) shall
      immediately and automatically, and without the need for any further notice
      to be
      given, any other document to be executed or other action to be taken by any
      Person, be deemed rescinded and cured for all purposes. 

     

          (b)
      If
      either
      of the Chief Executive Officer or the Chief Financial Officer of the Company
      obtains actual knowledge (without any duty of diligence or investigation being
      implied) of the occurrence or existence of an Event of Default, the Company
      shall promptly provide the Holder with written notice thereof The Company’s
      failure to promptly provide written notice of any Event of Default under the
      circumstances described in the immediately preceding sentence shall constitute
      a
      separate Event of Default. 

     

    (c) During
      the time that any portion of this Debenture is outstanding, if any Event of
      Default has occurred, the full principal amount of this Debenture, together
      with
      interest and other amounts owing in respect thereof, to the date of acceleration
      shall become at the Holder’s election, immediately due and payable in cash. In
      addition to any other remedies, the Holder shall have the right (but not the
      obligation) to convert this Debenture at any time after an Event of Default
      at
      the Conversion Price then in-effect. The Holder need not provide and the Company
      hereby waives any presentment, demand, protest or other notice of any kind.
      

     

    7. General
      Matters.
      

     

    (a) Governing
      Law.
      THIS
      DEBENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
      WITH,
      THE LAW OF THE STATE OF NEW YORK; INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401
      AND 5-1402 OF NEW YORK STATE’S GENERAL OBLIGATIONS LAW. 

     

    (b) Submission
      to Jurisdiction.
      The
      Holder and the Company each hereby (i) submit to the exclusive jurisdiction
      of the United States District Court for the Southern District of New York and
      of
      any New York state court sitting in New York County for the purposes of all
      legal proceedings arising out of or relating to this
      Debenture;
      (ii) waives to, the fullest extent permitted by applicable law, any
      objection which it may now or hereafter have to the laying of the venue of
      any
      proceeding brought in such a court or any claim that any such proceeding brought
      in such a court has been brought in an inconvenient forum; (iii) agrees
      that service of process in any such action or proceeding may be affected by
      mailing a copy thereof by registered or certified mail (or any substantially
      similar form and mail), postage prepaid, to the Holder or the Company at its
      respective address set forth below, or at such other address of which the Holder
      or the Company shall have been notified pursuant hereto; and (iv) agrees
      that nothing herein shall affect the right to effect service of process in
      any
      other manner permitted by law or shall limit the right to sue in any other
      jurisdiction. 

     

    (b)
      Fees
      and Expenses.
      In the
      event that any suit or action is instituted to enforce any provision under
      this
      Debenture, the prevailing party in such dispute shall be entitled to recover
      from the losing party the reasonable fees, costs and expenses of enforcing
      any
      right of such prevailing party under or with respect to this Debenture,
      including without limitation, such reasonable fees and expenses of attorneys
      and
      accountants, which shall include, without limitation, the reasonable fees,
      costs
      and expenses of appeals. 

     

    (c) Amendment
      or Waiver.
      Any
      term of this Debenture may be amended, and the observance of any term of this
      Debenture may be waived (either generally or in a particular instance and either
      retroactively or prospectively) only by the written consent of Holder.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (d) Headings.
      The headings in this Debenture are for purposes of convenience of reference
      only, and shall not be deemed to constitute a part of this Debenture.

     

    (e) Notices.
      All
      notices, requests, consents and other communications required or permitted
      hereunder shall be in writing (including telecopy or similar writing) and shall
      be sent to the address of the parties set forth below in this Section 7(e).
      Any notice, request, consent or other communication hereunder shall be deemed
      to
      have been given and received on the day on which it is delivered (by any means
      including personal delivery, overnight air courier, United States mail) or
      telecopied (or, if such day is not a business day or if the notice, request,
      consent or communication is not telecopied during business hours of the intended
      recipient, at the place of receipt, on the next following business day). Any
      of
      the parties hereto may, by notice given hereunder, designate any further or
      different address and/or number to which subsequent notices or other
      communications shall be sent. Unless and until such written notice is received,
      the addresses and numbers as provided herein shall be deemed to continue in
      effect for all purposes hereunder. 

     

    Addresses
      for Notices to Company: 

     

    Airbee
      Wireless, Inc. 

     

    9400
      Key
      West Avenue 

     

    Rockville,
      Maryland 20850 

     

    Attention:
      Eugene Sharer, President 

     

    Facsimile:
      (301) 517-1861 

     

    With
      a
      copy to: 

     

    Stradling
      Yocca Carlson & Rauth 

     

    660
      Newport Center Drive 

     

    Suite 1600
      

     

    Newport
      Beach, California 92660 

     

    Attention:
      Shivbir S. Grewal, Esq. 

     

    Facsimile:
      (949) 725-4100 

     

    Address
      for Notices to Holder: 

     

    Richard
      P. Sommerfeld, Jr. 

     

    115
      S.
      Oak Street 

    Falls
      Church, Virginia 22046 

    with
      a
      copy to: 

     

    Savit
      & Szymkowicz, LLP 

    7315
      Wisconsin Avenue 

    North
      Tower — Suite 601 

    Bethesda,
      Maryland 20814 

    Attention:
      Diana M. Savit, Esq. 

     

    Telephone:
      (301) 951-9191 

     

    Facsimile:
      (301) 718-7788 

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (f) Usury
      Limitation.
      In no
      event shall the amount paid or agreed to be paid to the Holder for the use
      or
      forbearance of money to be advanced hereunder exceed the highest lawful rate
      permissible under the then applicable usury laws. If it is hereafter determined
      by a court of competent jurisdiction that the interest payable hereunder is
      in
      excess of the amount which the Holder may legally collect under the then
      applicable usury laws, such amount which would be excessive interest shall
      be
      applied to the payment of the unpaid principal balance due hereunder and not
      to
      the payment of interest or, if all principal shall previously have been paid,
      promptly repaid by the Holder to the Company. 

     

    (g) Severability.
      Every
      provision of this Debenture is intended to be severable. If any term or
      provision hereof is declared by a court of competent jurisdiction to be illegal
      or invalid, such illegal or invalid term or provision shall not affect the
      balance of the terms and provisions hereof, which terms and provisions shall
      remain binding and enforceable. 

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the Company has caused this Debenture to be executed as of
      the
      day and year first above written. 

     

    
      	 	 	 
	 	
              AIRBEE
                WIRELESS, INC., 

              a
                Delaware corporation 

            
	 
 	 
 	 
 
	 	By:  	/s/ E.
              Eugene Sharer
	 	
              
Name:
              E. Eugene Sharer
	 	Title:
              President

    

     

    
      	ACKNOWLEDGED AND AGREED:	 	 	 
	 	 	 	 
	HOLDER: 	 	 	 
	 	 	 	 
	/s/
              Richard
              P. Sommerfeld, Jr	 	 	 
	
              
Richard
              P. Sommerfeld, Jr. 	 	 	
            
	 	 	 	 

    

    

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

    

     

    EXHIBIT
      I 

     

    NOTICE
      OF
      CONVERSION 

     

    (To
      be
      executed by the Holder in order to convert all or part of the 12% Subordinated
      Secured Convertible
      Debenture) 

     

    Airbee
      Wireless, Inc. 

    9400
      Key
      West Avenue 

    Rockville,
      Maryland 20850 

    Attention:
      E. Eugene Sharer, President 

     

    The
      undersigned hereby converts $      of
      the
      Face Amount and accrued and unpaid interest due and payable on April
     ,
      2010
      under that certain 12% Subordinated Secured Convertible Debenture dated as
      of
      April      ,
      2008
      (the “Debenture”), into the number of shares of Common Stock of the Company set
      forth below (“Shares”) on and subject to the conditions set forth in the
      Debenture. 

     

    
      	
               

            	
               

            	
               

            	
               

            	
               

            
	
              Date
                of Conversion

            	
               

            	
               

            	
              —

            	
               

            
	
              Shares
                to be Delivered

            	
               

            	
               

            	
              —

            	
               

            
	
                 HOLDER

            

    

     

          

     

     

    Richard
      P. Sommerfeld, Jr. 

     

    
      
        
        

      

      
        8

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