Document:

EXHIBIT
      10.13

     

    THIS
      NOTE AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT BEEN
      REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), NOR UNDER
      ANY STATE SECURITIES LAWS AND MAY NOT BE PLEDGED, SOLD, ASSIGNED OR OTHERWISE
      TRANSFERRED UNTIL (1) A REGISTRATION STATEMENT UNDER THE ACT AND ANY APPLICABLE
      STATE SECURITIES LAW HAS BECOME EFFECTIVE WITH RESPECT THERETO, OR (2) RECEIPT
      BY THE COMPANY OF AN OPINION OF COUNSEL TO THE COMPANY TO THE EFFECT THAT
      REGISTRATION UNDER THE ACT OR APPLICABLE STATE SECURITIES LAW IS NOT REQUIRED
      IN
      CONNECTION WITH THE PROPOSED TRANSFER

     

    SECURED
      CONVERTIBLE PROMISSORY NOTE 

     

    
      	$__0,000 	
              JANUARY
                16, 2008

            

    

     

    FOR
      VALUE
      RECEIVED, InterMetro
      Communications, Inc.,
      a
      Nevada corporation (the "Company"), promises to pay to the order of ___________
      (“Holder"), at such address as the Holder shall direct, the principal sum of
      _____________ Thousand Dollars ($__0,000) on the earlier of (i) July 15, 2009,
      (ii) at Holder's option by notice to the Company, the date the Holder's
      conversion right pursuant to Section 5 expires or (iii) simultaneously with
      the
      closing of (A) any transaction as a result of which the holders of the voting
      equity securities of the Company immediately before such transaction hold less
      than a majority of the voting equity securities of the acquiring or surviving
      entity immediately after such transaction or (B) the sale of all or
      substantially all of the assets of the Company (the "Maturity Date"). This
      Note
      is subject to the following terms and conditions:

     

    2 Loan
      Agreement; Payments.
      This
      Note is one constituent part of a multi-part Unit issued pursuant to, is secured
      by, and is subject to the terms and conditions of, that certain Loan and
      Security Agreement dated January 16, 2008, among the Company, the Subsidiaries,
      Holder, and certain other lenders (the “Loan Agreement”). (Capitalized terms
      used herein, which are not defined, shall have the meanings set forth in the
      Loan Agreement.) This Note is one of a duly authorized issue of Notes of the
      Company of like tenor and effect (except for variations necessary to express
      the
      name of the payee and the principal amount of the loan) issued pursuant to
      the
      Loan Agreement (collectively, the “Lender Notes”). All of the Lender Notes shall
      rank equally without preference or priority of any kind over one another, and
      all payments on account of principal and interest with respect to all of the
      Lender Notes shall be applied ratably and proportionally to all outstanding
      Lender Notes on the basis of the principal amount of outstanding indebtedness
      represented thereby. In the event of conflict between this Note and the Loan
      Agreement, the terms of the Loan Agreement will govern. Payments on this Note
      shall be applied first to accrued, unpaid interest and thereafter to reduce
      the
      outstanding principal amount. Notwithstanding the foregoing, this Note is
      subordinate to the obligations described in Section 3(k) of the Loan
      Agreement.

     

    3 Interest.
      This
      Note shall bear interest on the unpaid principal balance hereof from time to
      time outstanding at the rate set forth in the Loan Agreement. Accrued interest
      shall be payable on the Maturity Date, and any accrued interest not paid when
      due shall thereafter bear interest at the same rate as the principal hereunder.
      

     

    4 Origination
      Fee.
      The
      Company shall to pay Holder a deferred origination fee in an amount equal to
      three percent (3.0%) on the original principal amount of this Note on the
      earlier of (i) the date the Company makes its first prepayment, if any,
      hereunder or (ii) the Maturity Date (the "Origination Fee").

     

    5 Documentation
      Fee.
      The
      Company shall to pay to Holder a deferred documentation fee in an amount equal
      to two and one-half percent (2.5%) of the original principal amount of this
      Note
      on the earlier of (i) the date the Company makes its first prepayment, if any,
      hereunder or (ii) the Maturity Date (the
      "Documentation Fee”).

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    6 Conversion.
      

     

    (a) Conversion
      Right.
      The
      Company shall give the Holder written notice (the “Financing Notice”) within
      three (3) days of the closing of the sale, in one or more transactions, of
      debt
      or equity securities of the Company in which the aggregate gross proceeds
      received by the Company equals or exceeds $10,000,000 (the “Financing”). The
      Financing Notice shall set forth in reasonable detail the terms of the Financing
      and shall include copies of all documents executed by purchasers of securities
      in the Financing originally executed by the Company (the “Financing Documents”).
      Upon the occurrence of a Financing, the Holder shall have the right to convert
      the entire principal, accrued interest, the Origination Fee amount and the
      Documentation Fee amount (collectively, the “Conversion Amount”), or any portion
      thereof, into either (i) the securities sold in the Financing at the price
      established for such securities in the Financing (“Purchase Price”) and on the
      same terms and conditions as other purchasers in the Financing or (ii) such
      number of fully paid and non-assessable shares of the Company’s common stock as
      is determined by dividing the Conversion Amount by $1.00 (the “Conversion
      Price”).

     

    (b) Mechanics
      of Conversion.
      No
      fractional securities shall be issued upon conversion of this Note. In lieu
      of
      any fractional security to which the Holder would otherwise be entitled, the
      Company shall pay cash equal to such fraction multiplied by the then effective
      Purchase Price or Conversion Price, as the case may be. To convert the Note
      pursuant to Section 5(a), the Holder shall surrender the Note and shall give
      written notice to the Company in accordance with the notice provisions set
      forth
      in the Loan Agreement, of the election to convert the same, which notice shall
      state the securities to be acquired (clause (i) or clause (ii) of Section 5(a))
      and the amount of principal and/or interest being converted, which notice must
      be delivered to the Company no later than 15 days after receipt of the Company’s
      Financing Notice, after which the conversion right shall expire. In addition,
      the Holder’s conversion notice shall be accompanied by Financing Documents
      executed by the Holder if the Holder has elected to convert this Note into
      securities issued in the Financing. Such conversion shall be deemed to have
      been
      made immediately prior to the close of business on the date of such conversion
      notice and surrender of the Note. The Company shall, as soon as practicable
      thereafter, and in no event later than 10 days after the date of the conversion,
      issue and deliver to such address as the Holder may direct, a certificate or
      certificates for the securities to which such Holder shall be entitled and,
      if
      applicable, a new Note in the principal amount which has not been converted
      pursuant to Section 5(a).

     

    (c) Adjustment
      of Conversion Price.
      The
      Conversion Price and the securities deliverable upon conversion of this Note
      in
      accordance with clause (ii) of Section 5(a) are subject to adjustment upon
      occurrence of the following:

    

    (i) Adjustment
      for Stock Splits, Stock Subdivisions or Combinations of Shares of Common
      Stock.
      The
      Conversion Price of this Note shall be proportionally decreased and the number
      of securities deliverable upon the conversion of this Note shall be
      proportionally increased to reflect any stock split or subdivision of the
      Company’s Common Stock. The Conversion Price of this Note shall be
      proportionally increased and the number of securities deliverable upon the
      conversion of this Note shall be proportionally decreased to reflect any
      combination of the Company’s Common Stock.

    

    (ii) Adjustment
      for Dividends or Distributions of Stock or Other Securities or
      Property.
      In case
      the Company shall make or issue, or shall fix a record date for the
      determination of eligible holders entitled to receive, a dividend or other
      distribution with respect to the Common Stock (or any shares of stock or other
      securities at the time issuable upon conversion of this Note) payable in (a)
      securities of the Company or (b) assets (excluding cash dividends paid or
      payable solely out of retained earnings), then, in each such case, the Holder
      of
      this Note on conversion hereof at any time after the consummation, effective
      date or record date of such dividend or other distribution, shall receive,
      in
      addition to the shares of Common Stock (or such other stock or securities)
      issuable on such conversion prior to such date, and without the payment of
      additional consideration therefore, the securities or such other assets of
      the
      Company to which such Holder would have been entitled upon such date if such
      Holder had converted this Note immediately prior to such making, issuance or
      record date.

    

    (iii) Reclassification,
      Conversion.
      If the
      Company, by reclassification of securities or conversion of securities or
      otherwise, shall change any of the securities as to which conversion rights
      under this Note exist into the same or a different number of securities of
      any
      other class or classes, this Note shall thereafter represent the right to
      acquire such number and kind of securities as would have been issuable if this
      Note had been converted immediately prior to such reclassification or conversion
      or other change and the Conversion Price therefore shall be appropriately
      adjusted, all subject to further adjustment as provided in this Section 5(c).
      

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    (iv) Adjustment
      for Capital Reorganization. Merger or Consolidation.
      In case
      of any capital reorganization of the capital stock of the Company (other than
      a
      combination, reclassification, exchange or subdivision of shares otherwise
      provided for herein), or any merger or consolidation of the Company with or
      into
      another corporation, or the sale of all or substantially all the assets of
      the
      Company then, and in each such case, as a part of such reorganization, merger,
      consolidation, sale or transfer, lawful provision shall be made so that the
      Holder of this Note shall thereafter be entitled to receive upon conversion
      of
      this Note the number of shares of stock or other securities or property that
      a
      holder of the shares deliverable upon conversion of this Note would have been
      entitled to receive in such reorganization, consolidation, merger, sale or
      transfer if this Note had been converted immediately before such reorganization,
      merger, consolidation, sale or transfer, all subject to further adjustment
      as
      provided in this Section 5(c). The foregoing provisions of this Section
      5(c)(iv) shall similarly apply to successive reorganizations, consolidations,
      mergers, sales and transfers and to the stock or securities of any other
      corporation that are at the time receivable upon the conversion of this Note.
      If
      the per-share consideration payable to the Holder hereof for shares in
      connection with any such transaction is in a form other than cash or marketable
      securities, then the value of such consideration shall be determined in good
      faith by the Company’s Board of Directors. In all events, appropriate adjustment
      (as determined in good faith by the Company’s Board of Directors) shall be made
      in the application of the provisions of this Note with respect to the rights
      and
      interests of the Holder after the transaction, to the end that the provisions
      of
      this Note shall be applicable after that event, as near as reasonably may be,
      in
      relation to any shares or other property deliverable after that event upon
      conversion of this Note.

     

    (d) No
      Impairment.
      The
      Company will not, by amendment of its Articles of Incorporation or through
      any
      reorganization, transfer of assets, consolidation, merger, dissolution, issue
      or
      sale of securities or any other voluntary action, avoid or seek to avoid the
      observance or performance of any of the terms to be observed or performed
      hereunder by the Company, but will at all times in good faith assist in the
      carrying out of all the provisions of this Note and in the taking of all such
      action as may be necessary or appropriate in order to protect the conversion
      rights of the Holders set forth herein against impairment.

    

    (e) Reservation
      of Securities.
      The
      Company shall reserve, so long as this Note is outstanding, such securities
      as
      the Holder is entitled to receive upon conversion of this Note. Prior to the
      issuance of any equity securities and whenever otherwise required, the Company
      shall amend its Articles of Incorporation to ensure that there is a sufficient
      quantity of such equity securities (and Common Stock into which such equity
      securities may be convertible) into which the Notes are entitled to be converted
      hereunder. 

    

    7 Prepayment.
      In the
      event the Company prepays all or any portion of the principal amount due under
      this Note, the Company shall, together with such prepayment, pay to the Holder
      of this Note, as a prepayment penalty, an amount equal to 80% of the interest
      which would have accrued on such prepaid principal amount from the date of
      such
      prepayment through the Maturity Date. If a Financing occurs within 45 days
      of
      any prepayment hereunder, the Company shall give a Financing Notice to Holder
      within 3 days of the closing thereof and Holder shall have the right to
      participate in such Financing to the extent of the amount of such prepayment
      pursuant to Section 5 hereof as though such prepayment had not been made. In
      lieu of delivering the Note as provided in Section 5(b), Holder shall pay the
      Purchase Price in the manner provided in the Financing.

    

    8 Default.
      Upon
      the occurrence of any Event of Default (as defined in the Loan Agreement),
      the
      entire unpaid principal balance of this Note, all accrued and unpaid interest
      and all Obligations shall become or may be declared to be immediately due and
      payable, as provided in the Loan Agreement.

    

    9 General.
      Principal of and interest on this Note shall be payable in lawful money of
      the
      United States of America. If a payment hereunder becomes due and payable on
      a
      Saturday, Sunday or legal holiday, the due date thereof shall be extended to
      the
      next succeeding Business Day, and interest shall be payable thereon during
      such
      extension. The Company agrees to pay all costs and expenses (including without
      limitation reasonable attorney's fees) incurred by Holder or Agent in connection
      with the enforcement of this Note. The Company hereby waives presentment, demand
      for payment, notice of dishonor, notice of nonpayment, protest, notice of
      protest, and any and all other notices and demands in connection with the
      delivery, acceptance, performance, default, or enforcement of this Note. This
      Note is secured by the Loan Agreement and all other present and future security
      agreements between the Company, Holder and Agent. Nothing herein shall be deemed
      to limit any of the terms or provisions of the Loan Agreement or any other
      present or future document, instrument or agreement, between the Company, Holder
      and Agent, and all of Holder's rights and remedies hereunder and thereunder
      are
      cumulative. In the event any one or more of the provisions of this Note shall
      for any reason be held to be invalid, illegal or 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 is payable in, and shall
      be governed by the laws of, the State of California. Any
      notices which the Company or the Holder is required or desires to give to the
      other shall be in writing and shall be deemed to have been given when given
      as
      provided in the Loan Agreement. This Note, and the obligations of the Company
      hereunder, shall be binding upon the Company, and shall inure to the benefit
      of
      the Holder, and their respective heirs, executors, administrators, successors
      and assigns.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    10 No
      Shareholder Rights.
      Nothing
      contained in this Note shall be construed as conferring upon the Holder or
      any
      other person the right to vote or to consent or to receive notice as a
      shareholder in respect of meetings of shareholders for the election of directors
      of the Company or any other matters or any rights whatsoever as a shareholders
      of the Company; and no dividends shall be payable or accrued in respect of
      this
      Note or the interest represented hereby, or the equity securities into which
      this Note may be converted, until, and only to the extent that, this Note shall
      have been converted as provided herein.

     

    
      	
              INTERMETRO
                COMMUNICATIONS, INC.

            
	
              a
                Nevada corporation

            
	 
	
              By

            	  
	
              for
                InterMetro Communications, Inc.

            
	 	
              PresidentNEONODE,
      INC.

    

    NOTE
      PURCHASE AGREEMENT

     

    NOTE
      PURCHASE AGREEMENT (the “Agreement”)
      dated
      as of February 28, 2006 among NEONODE, INC., a Delaware corporation
      (“Company”),
      AIGH
      Investment Partners LLC, a Delaware limited liability company ( “AIGH”), and any
      other person who executes this agreement from time to time as purchaser of
      Notes
      (collectively with AIGH, the “Investors”).

    

    Background: The
      Company desires to sell to the Investors, and the Investors desire to purchase
      up to $5,500,000 in principal amount of Senior Secured Notes, in substantially
      the form attached hereto as Exhibit 1 (the “Notes”).
      It is
      anticipated there will be up to two closings since the Notes will be issued
      in
      tranches. The proceeds are necessary for the development and continuance of
      the
      business of the Company and each of its subsidiaries.

     

    Certain
      Definitions:

    

    “Common
      Stock”
shall
      mean stock of the Company of any class (however designated) whether now or
      hereafter authorized, which generally has the right to participate in the voting
      and in the distribution of earnings and assets of the Company without limit
      as
      to amount or percentage, including the Company’s Common Stock, $.01 par value
      per share.

    

    “Company”
      includes the Company and any corporation or other entity which shall succeed
      to
      or assume, directly or indirectly, the obligations of the Company hereunder.
      The
      term “corporation”
shall
      include an association, joint stock company, business trust, limited liability
      company or other similar organization.

    

    “Company
      Disclosure”
means
      the disclosure delivered to the Investors prior to the execution of this
      Agreement.

    

    “Material
      Adverse Change”
shall
      mean any change in the facts represented by the Company in the Agreement or
      the
      business, financial condition, results of operation, prospects, properties
      or
      operations of the Company and its subsidiaries taken as a whole which may have
      a
      material adverse effect on the value of the Common Stock of the
      Company.

    

    “Neonode
      AB”
means
      Neonode AB, a Swedish corporation.

    

    “Petrus”
means
      Petrus Holdings, SA, a corporation organized under the laws of
      Luxembourg.

    

    “Person”
means
      any individual, sole proprietorship, partnership, corporation, limited liability
      company, business trust, unincorporated association, joint stock corporation,
      trust, joint venture or other entity, any university or similar institution,
      or
      any government or any agency or instrumentality or political subdivision
      thereof.

    

    “Public
      Offering”
shall
      mean a registered public offering of Common Stock of the Company.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    “SEC”
means
      the Securities and Exchange Commission. 

    

    “Securities
      Act”
means
      the Securities Act of 1933, as amended.

     

    In
      consideration of the mutual covenants contained herein, the parties agree as
      follows:

    

    1. Purchase
      and Sale of Notes.

    

    1.1. Sale
      and Issuance of Notes.
      The
      Company shall sell to the Investors and the Investors shall purchase from the
      Company, up to an aggregate in principal amount of $5,500,000 of Notes at par.
      The principal amount of Notes to be purchased by the Investors from the Company
      in the First Closing (as defined herein) is set forth opposite the name of
      each
      Investor on the signature page hereof, subject to acceptance, in whole or in
      part, by the Company. Subject to Section 1.4 hereof, AIGH shall purchase the
      Notes included in the Second Closing whether or not any other Investor agrees
      to
      participate in such purchase. 

    

    1.2. Closings.
      The
      closings of the purchase and sale of the Notes hereunder (each a “Closing”)
      shall
      take place (i) within three business days after the date hereof, for the
      purchase of $4,000,000 principal amount of Notes (the “First
      Closing”)
      and,
      (ii) immediately prior to filing of an appropriate registration statement in
      connection with a Public Offering with Griffin Securities, Inc. or other
      investment bank satisfactory to the Investors, for the purchase of $1,500,000
      principal amount of Notes (the “Second
      Closing”);
      provided in each case the Company has not suffered any Material Adverse Change
      since the date hereof. Any date on which a Closing occurs is referred to herein
      as the “Closing
      Date.”
The
      date on which the First Closing takes place is referred to herein as the
“First
      Closing Date.”
The
      date on which the Second Closing takes place is referred to herein as the
“Second
      Closing Date.”
Each
      Closing shall take place at the offices of Hahn & Hessen LLP, the Investors’
counsel, in New York, New York, or at such other location as is mutually
      acceptable to the Investors and the Company.

    

    1.3. Conditions
      of First Closing.
      The
      obligation of the Investors to complete the purchase of the Notes at the First
      Closing is subject to fulfillment of the following conditions:

    

    (a) the
      Company and the Investors shall execute and deliver a Security Agreement, dated
      the First Closing Date, in the form attached as Exhibit 2
      (the
“Security
      Agreement”);

    

    (b) certain
      stockholders of the Company (the “Pledgors”)
      and
      the Investors shall execute and deliver a Pledge and Security Agreement, dated
      the First Closing Date, in the form attached as Exhibit 3
      (the
“Stockholder
      Pledge Agreement”);

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (c) each
      Pledgor shall execute and deliver to the Investors a Guaranty Agreement, dated
      the First Closing Date, in the form attached as Exhibit
      4
      (the
“Guaranty”);

    

    (d) Petrus
      and the Investors shall enter into the Intercreditor Agreement, dated the First
      Closing Date, in the form attached hereto as Exhibit
      5
      (the
“Intercreditor
      Agreement”,
      and
      with the Agreement, the Notes, the Security Agreements, the Stockholder
      Pledge Agreement, the Guaranty and
      other
      documents required in connection with the transactions contemplated in the
      Agreement, the “Transaction
      Documents”);

    

    (e) the
      Company shall have executed and delivered all documents, such as financing
      statements and assignments, reasonably requested by counsel for the Investors;
      

    

    (f) the
      absence of any Material Adverse Change since the date hereof, and

    

    (g) the
      Company shall pay the Investors expenses to the extent set forth in Section
      6.9
      hereof.

    

    1.4. Conditions
      of Second Closing.
      The
      obligations of the Investors to complete the purchase of the Notes at the Second
      Closing are subject to fulfillment of the following conditions:

    

    (a) the
      absence of Material Adverse Change since the date hereof; and

    

    (b) the
      Company shall pay the Investors expenses to the extent set forth in Section
      6.9
      hereof.

    

    2. Representations
      and Warranties of the Company.
      The
      Company hereby represents and warrants to each of the Investors as
      follows:

    

    2.1. Corporate
      Organization; Authority; Due Authorization.

    

    (a) The
      Company (i) is a corporation duly organized, validly existing and in good
      standing under the laws of the jurisdiction of its incorporation, (ii) has
      the
      corporate power and authority to own or lease its properties as and in the
      places where such business is now conducted and to carry on its business as
      now
      conducted and (iii) is duly qualified and in good standing as a foreign
      corporation authorized to do business in every jurisdiction where the failure
      to
      so qualify, individually or in the aggregate, would have a material adverse
      effect on the operations, prospects, assets, liabilities, financial condition
      or
      business of the Company 

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (b) The
      Company (i) has the requisite corporate power and authority to execute, deliver
      and perform this
      Agreement and the other Transaction Documents to
      which
      it is a party and
      to
      incur the obligations herein and therein and (ii) has been authorized by all
      necessary corporate action to execute, deliver and perform this Agreement and
      the other Transaction Documents to which it is a party and to consummate the
      transactions contemplated hereby and thereby (the “Contemplated
      Transactions”).
      Each
      of this Agreement and the other Transaction Documents is a valid and binding
      obligation of the Company enforceable in accordance with its terms except as
      limited by applicable bankruptcy, reorganization, insolvency, moratorium or
      similar laws affecting the enforcement of creditors’ rights and the availability
      of equitable remedies (regardless of whether such enforceability is considered
      in a proceeding at law or equity).

    

    2.2. Capitalization.
      As of
      February 28, 2006, the authorized capital stock of the Company is 6,500,000
      shares of Common Stock, $.01 par value per share. Except as contemplated by
      this
      Agreement or as set forth in the Company Disclosure, there are (i) no
      outstanding subscriptions, warrants, options, conversion privileges or other
      rights or agreements obligating the Company or Neonode AB to purchase or
      otherwise acquire or issue any shares of capital stock of the Company or Neonode
      AB (or shares reserved for such purpose) except as set forth in the
      Capitalization Table attached hereto as Exhibit 6 (the “Capitalization
      Table”),
      (ii) no preemptive rights contained in the Company’s Certificate of
      Incorporation, as amended (the “Certificate
      of Incorporation”),
      By-Laws of the Company or contracts to which the Company is a party or rights
      of
      first refusal with respect to the issuance of additional shares of capital
      stock
      of the Company, and (iii) no commitments or understandings (oral or
      written) of the Company or Neonode AB to issue any shares, warrants, options
      or
      other rights. Except as disclosed in the Company Disclosure, the Company owns
      100% of the outstanding equity of Neonode AB.

     

    2.3. Validity
      of Notes.
      The
      issuance of the Notes has been duly authorized.

    

    2.4. Private
      Offering.
      Neither
      the Company nor anyone acting on its behalf has within the last 12 months
      issued, sold or offered any security of the Company (including, without
      limitation, any Notes) to any Person under circumstances that would cause the
      issuance and sale of the Notes, as contemplated by this Agreement, to be subject
      to the registration requirements of the Securities Act. 

    

    2.5. Brokers
      and Finders.
      The
      Company has not retained any investment banker, broker or finder in connection
      with the Contemplated Transactions.

    

    2.6. Absence
      of Certain Changes.
      Except
      as specifically contemplated by this Agreement or set forth in the Company
      Disclosure, there has not been any Material Adverse Change since December 31,
      2005.

    

    2.7. Company
      Disclosure.
      No
      representation or warranty of the Company herein, no exhibit or schedule hereto,
      and no information contained or referenced in the Company Disclosure, when
      read
      together, contains or will contain any untrue statement of a material fact
      or
      omits or will omit to state a material fact necessary in order to make the
      statements contained herein or therein, in light of the circumstances under
      which they were made, not misleading. 

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    3. Representations
      and Warranties of the Investors.
      Each
      Investor represents and warrants to the Company as follows:

    

    3.1. Authorization.
      Such
      Investor (i) has full power and authority to execute, deliver and perform this
      Agreement and the other Transaction Documents to which it is a party and to
      incur the obligations herein and therein and (ii) if applicable has been
      authorized by all necessary corporate or equivalent action to execute, deliver
      and perform this Agreement and the other Transaction Documents and to consummate
      the Contemplated Transactions. Each of this Agreement and the other Transaction
      Documents to which the Investors are parties is a valid and binding obligation
      of such Investor enforceable in accordance with its terms, except as limited
      by
      applicable bankruptcy, reorganization, insolvency, moratorium or similar laws
      affecting the enforcement of creditors’ rights and the availability of equitable
      remedies (regardless of whether such enforceability is considered in a
      proceeding at law or equity).

    

    3.2. Brokers
      and Finders.
      Such
      Investor has not retained any investment banker, broker or finder in connection
      with the Contemplated Transactions.

    

    4. Securities
      Laws.

    

    4.1. This
      Agreement is made with each Investor in reliance upon such Investor’s
      representation to the Company, which by such Investor’s execution of this
      Agreement such Investor hereby confirms, that the Notes to be received by such
      Investor will be acquired for investment for such Investor’s own account, not as
      a nominee or agent, and not with a view to the resale or distribution of any
      part thereof such that such Investors would constitute an “underwriter” under
      the Securities Act. 

    

    4.2. Each
      Investor understands and acknowledges that the offering of the Notes pursuant
      to
      this Agreement will not be registered under the Securities Act or qualified
      under any Blue Sky Laws on the grounds that the offering and sale of the Notes
      are exempt from registration and qualification, respectively, under the
      Securities Act and the Blue Sky Laws.

    

    4.3. Each
      Investor represents that (i) such Investor is able to fend for itself in
      the Contemplated Transactions; (ii) such Investor has such knowledge and
      experience in financial and business matters as to be capable of evaluating
      the
      merits and risks of such Investor’s prospective investment in the Notes; and
      (iii) such Investor has the ability to bear the economic risks of such
      Investor’s prospective investment and can afford the complete loss of such
      investment.

    

    4.4. Each
      Investor further represents by execution of this Agreement that such Investor
      qualifies as an “accredited investor” as such term is defined under Rule 501
      promulgated under the Securities Act. Any Investor that is a corporation, a
      partnership, a limited liability company, a trust or other business entity
      further represents by execution of this Agreement that it has not been organized
      for the purpose of purchasing the Notes.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    4.5. By
      acceptance hereof, each Investor agrees that the Notes and any shares of capital
      stock of the Company received in respect of the foregoing held by it may not
      be
      sold by such Investor without registration under the Securities Act or an
      exemption therefrom, and therefore such Investor may be required to hold such
      securities for an indeterminate period.

    

    5. Additional
      Covenants of the Company.

    

    5.1. Reports
      and Information.
      Until
      the sooner of repayment or conversion of all the Notes or a Public Offering,
      the
      Company shall deliver to such Investor (or the successor or assign of such
      Investor), contemporaneously with delivery to Petrus or its affiliates, a copy
      of each report of the Company delivered to any such person.

    

    6. Miscellaneous.

    

    6.1. Entire
      Agreement; Successors and Assigns.
      This
      Agreement and the other Transaction Documents constitute the entire contract
      between the parties relative to the subject matter hereof and thereof, and
      no
      party shall be liable or bound to the other in any manner by any warranties,
      representations or covenants except as specifically set forth herein or therein.
      This Agreement and the other Transaction Documents supersede any previous
      agreement among the parties with respect to the Notes. The terms and conditions
      of this Agreement shall inure to the benefit of and be binding upon the
      respective executors, administrators, heirs, successors and assigns of the
      parties. Except as expressly provided herein, nothing in this Agreement,
      expressed or implied, is intended to confer upon any party, other than the
      parties hereto, any rights, remedies, obligations or liabilities under or by
      reason of this Agreement.

    

    6.2. Survival
      of Representations and Warranties.
      All
      representations and warranties of the Company shall survive the execution and
      delivery of this Agreement and the Closing hereunder and shall continue in
      full
      force and effect for one year after the Fourth Closing. The covenants of the
      Company set forth in Section 5 shall remain in effect as set forth
      therein.

    

    6.3. Governing
      Law; Jurisdiction.
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of New York without regard to principles of conflicts of law. Each party
      hereby irrevocably consents and submits to the jurisdiction of any New York
      State or United States Federal Court sitting in the State of New York, County
      of
      New York, over any action or proceeding arising out of or relating to this
      Agreement and irrevocably consents to the service of any and all process in
      any
      such action or proceeding by registered mail addressed to such party at its
      address specified in Section 6.6 (or as otherwise noticed to the other party).
      Each party further waives any objection to venue in New York and any objection
      to an action or proceeding in such state and county on the basis of forum
      non conveniens.
      Each
      party also waives any right to trial by jury.

    

    6.4. Counterparts.
      This
      Agreement may be executed in two or more counterparts, each of which shall
      be
      deemed an original, but all of which together shall constitute one and the
      same
      instrument.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    6.5. Headings.
      The
      headings of the sections of this Agreement are for convenience and shall not
      by
      themselves determine the interpretation of this Agreement.

    

    6.6. Notices.
      Any
      notice required or permitted hereunder shall be given in writing and shall
      be
      deemed effectively given upon (i) personal delivery, (ii) delivery by fax (with
      answer back confirmed) or (iii) delivery by electronic mail (with reception
      confirmed), addressed to a party at its address or sent to the fax number or
      e-mail address shown below or at such other address, fax number or e-mail
      address as such party may designate by three days advance notice to the other
      party. 

    

    Any
      notice to Investors shall be sent to the addresses set forth on the signature
      pages hereof, with a copy to: 

    

    Hahn
      & Hessen LLP

    488
      Madison Avenue

    New
      York,
      New York 10022

    Attention:
      James Kardon, Esq.

    Fax
      Number: (212) 478-7400

    e-mail:
      jkardon@hahnhessen.com

    

    Any
      notice to the Company shall be sent to:

    

    Neonode,
      Inc.

    Biblioteksgatan
      11 

    S111
      46
      Stockholm, Sweden

    Attention:
      President

    Fax
      Number: 

    

    with
      a
      copy to: 

    

    Reed
      Smith LLP

    435
      Sixth
      Avenue

    Pittsburgh,
      PA 15219

    Attention:
      Daniel Gallagher, Esq.

    Fax
      Number: 412-288-3063

    

    6.7. Rights
      of Transferees.
      Any and
      all rights and obligations of the Investor herein incident to the ownership
      of
      Notes shall pass successively to all subsequent transferees of such securities
      until extinguished pursuant to the terms hereof.

    

    6.8. Severability.
      Whenever possible, each provision of this Agreement shall be interpreted in
      such
      a manner as to be effective and valid under applicable law, but if any provision
      of this Agreement shall be deemed prohibited or invalid under such applicable
      law, such provision shall be ineffective to the extent of such prohibition
      or
      invalidity, and such prohibition or invalidity shall not invalidate the
      remainder of such provision or any other provision of this
      Agreement.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    6.9. Expenses.
      Irrespective of whether any Closing is effected, the Company shall pay all
      costs
      and expenses that it incurs with respect to the negotiation, execution, delivery
      and performance of this Agreement. Each Investor shall be responsible for all
      costs incurred by such Investor in connection with the negotiation, execution,
      delivery and performance of this Agreement including, but not limited to, legal
      fees and expenses, except that, at each Closing, the Company shall pay legal
      fees and expenses to Hahn & Hessen LLP, as counsel to the
      Investors.

    

    6.10. Amendments
      and Waivers.
      Unless
      a particular provision or section of this Agreement requires otherwise
      explicitly in a particular instance, any provision of this Agreement may be
      amended and the observance of any provision of this Agreement 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 holders
      of
      Notes. Any amendment or waiver effected in accordance with this Section 6.10
      shall be binding upon each holder of any Notes at the time outstanding
      (including securities into which such Securities are convertible), each future
      holder of all such Notes, and the Company.

     

    IN
      WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement
      as of the date first above written.

    

    
      	
              NEONODE
                INC.

            	 
	 	 
	 	 
	
              By:

            	 
	
              Its:

            	 
	 	 
	 	 
	
              AIGH
                INVESTMENT PARTNERS, LLC

            
	 	 
	 	 
	
              By:

            	 
	
              Its:

            	 

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    SIGNATURE
      PAGE

    TO

    NEONODE,
      INC.

    SUBSCRIPTION
      AGREEMENT

    Dated
      February 28, 2006

     

    

    IF
      the
      PURCHASER is an INDIVIDUAL, please complete the following:

    

    IN
      WITNESS WHEREOF, the undersigned has executed this Agreement this ____ day
      of
      ________, 2006.

    

      
        	
                Amount
                  of Subscription:

              	 	 
	
                $__________
                  principal
                  amount of Notes

              	 	 
	 	
                Print
                  Name

              	 
	 	 	 
	 	 	 
	 	 	 
	 	
                Signature
                  of Investor

              	 
	 	 	 
	 	 	 
	 	 	 
	 	
                Social
                  Security Number

              	 
	 	 	 
	 	 	 
	 	 	 
	 	
                Address
                  and Fax Number

              	 
	 	 	 
	 	 	 
	 	 	 
	 	
                E-mail
                  Address

              	 
	 	 	 
	
                ACCEPTED
                  AND AGREED:

              	 	 
	 	 	 
	
                NEONODE,
                  INC.

              	 	 
	 	 	 
	 	 	 
	
                By:

              	 	 	 	 
	 	 	 	 
	
                Dated:

              	 	 	 	 

      

    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    SIGNATURE
      PAGE

    TO

    NEONODE,
      INC.

    SUBSCRIPTION
      AGREEMENT

    Dated
      February 28, 2006 

    

    IF
      the
      PURCHASER is a PARTNERSHIP, CORPORATION, LIMITED LIABILITY COMPANY, TRUST or
      OTHER ENTITY, please complete the following:

    

    IN
      WITNESS WHEREOF, the undersigned has executed this Agreement this __th day
      of
      __________, 2006.

    
       

    

    
      	
              Amount
                of subscription:

              $____________
                principal amount of Notes 

            	 
	 	 
	 	
              ___________________________________

              Print
                Full Legal Name of Partnership,

              Company,
                Limited Liability Company, Trust or Other Entity

            
	 	 
	 	
              By:
                __________________________________

              (Authorized
                Signatory)

            
	 	
              Name:
                ________________________________

            
	 	
              Title:
                _________________________________

            
	 	
              Address
                and Fax Number: _____________

               

              ___________________________________

            
	 	 
	 	
              Taxpayer
                Identification Number: __________

            

    

    Date
      and
      State of Incorporation or Organization:__________________________ 

    Date
      on
      which Taxable Year Ends:_____________________________________

    

    E-mail
      Address: ________________________

    

    ACCEPTED
      AND AGREED:

    

    NEONODE,
      INC.

     

    By: ____________________________

    Name:
      __________________________

    Title: ___________________________

    Dated: __________________________

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBITS
      

    TO
      THE
      NOTE PURCHASE AGREEMENT

     

    Exhibit
      1: Form
      of
      Notes

    Exhibit
      2: Form
      of
      Security Agreement

    Exhibit
      3: Form
      of
      Stockholder Pledge Agreement 

    Exhibit
      4: Form
      of
      Guaranty 

    Exhibit
      5: Form
      of
      Intercreditor Agreement 

    Exhibit
      6: Capitalization
      Table 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Exhibit
      1

    

    Form
      of
      Notes

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Exhibit
      2

    

    Form
      of
      Security Agreement

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Exhibit
      3

    

    Form
      of
      Stockholder Pledge Agreement

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Exhibit
      4

    

    Form
      of
      Guaranty

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Exhibit
      5

    

    Form
      of
      Intercreditor Agreement

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Exhibit
      6

    

    Capitalization
      Table

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00140-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00140-of-00352.parquet"}]]