Document:

ex10-1.htm

Exhibit 10.1

 

THE SECURITY REPRESENTED HEREBY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS AND NEITHER SUCH SECURITY NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH LAWS WHICH, IN THE OPINION OF COUNSEL FOR THE HOLDER, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO COUNSEL FOR THIS COMPANY, IS AVAILABLE.

AEGIS IDENTITY SOFTWARE, INC.

9% PROMISSORY NOTE

 

	$500,000.00 	 January 14, 2016

FOR VALUE RECEIVED, Aegis Identity Software, Inc., a Delaware corporation (the “Company”), promises to pay to the order of Code Rebel Corporation and its successors and assigns (the “Holder”), the principal sum of Five Hundred Thousand Dollars ($500,000.00), in accordance with the terms hereof, and to pay interest on the principal sum outstanding, at the rate of nine percent (9%) per annum, compounded annually.  Accrual of interest on the outstanding principal amount shall commence on the date hereof and shall continue until payment in full of the outstanding principal amount has been paid or otherwise discharged.  This Note is unsecured.  The Company hereby acknowledges receipt of such principal sum.

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

1.           Principal Repayment.

 

(a)           This Note and any accrued interest hereunder will become due and payable in accordance with the terms hereof upon the earlier of (i) the consummation of any initial public offering (an “IPO”) of the Company’s common stock, par value $.001 per share (the “Common Stock”), (ii) the closing of a Business Combination, (iii) the date that there is a breach by or on behalf of the Company of the provisions entitled “Exclusivity” of that certain Confidential Letter of Intent between the Company and the initial Holder of this Note dated as of even date of this Note (the “Letter Agreement”); and (iv) June 30, 2016 (such earlier date, the “Maturity Date”), provided that the Maturity Date shall not be earlier than June 30, 2016 if there is a breach by or on behalf of the initial Holder of this Note of the provisions entitled “Exclusivity” of the Letter Agreement.

 

  

  

  

(b)           For the purposes of this Note, the following terms shall have the respective meanings provided in this Section 1(b):

 

(i)              “Business Combination” shall mean the: (A) merger of the Company with any Person in which the stockholders of the Company (if considered a group) immediately prior to such transaction do not continue to control, directly or indirectly, more than 50% of the voting securities of the surviving Person in such transaction and have a right to at least more than 50% of the aggregate economic rights of distributions or dividends to holders of securities of such surviving Person and any Person that Controls such surviving Person; (B) the sale of all or substantially all of the assets of the Company, including any sale by license, contract or similar arrangement, in one or a series of related transactions; (C) any tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of common stock of the Company are permitted to tender or exchange their shares for other securities, cash or property, or (D) the Company effects any reclassification of its common stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property.

 

(ii)              “Control” shall mean power and authority of a specified Person to controls the business and affairs of any other specified Person.

 

(iii)              “Person” shall mean an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

 

2.           Interest.  The holders of the Notes are entitled to receive interest at an annual interest rate of nine percent (9%), compounded annually, of the outstanding principal amount of this Note; provided, however, that during any Event of Default (as defined below) under this Note the interest rate shall increase to 15% per annum, compounded annually.  Interest on the outstanding principal balance of this Note shall be computed on the basis of the actual number of days elapsed and a 365-day year. The interest shall accrue until the date on which all of the obligations of this Note have been paid in full.  All accrued interest on the outstanding balance of this Note shall be paid on the Maturity Date.

 

3.           [intentionally omitted].

 

4.           [intentionally omitted].

 

5.           Affirmative and Negative Covenants of the Company. The Company hereby covenants to the Holder as follows:

 

(a)           Event of Default.  Within five (5) business days of any officer of the Company obtaining knowledge of any Event of Default (as defined in Section 6 hereof), if such Event of Default is then continuing, the Company shall furnish to the Holder a certificate of the chief financial or accounting officer of the Company setting forth the details thereof and the action which the Company is taking or proposes to take with respect thereto.

 

  

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(b)           Performance.  The Company will not, by any 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 the provisions of this Note and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the Holder of this Note against impairment.

 

(c)           Use of Proceeds.  The proceeds of the loan represented by this Note shall be used by the Company only for the payment of normal recurring operating expenses that are incurred by the Company in connection with its ordinary course of business, consistent with past practices.  The Company has provided the Holder with a true and reasonably complete schedule of the anticipated initial uses of the proceeds of the loan represented by this Note and shall provide Holder with a true and complete schedule that summarizes in reasonable detail the cash expenditures or payments made by the Company or any accrual of cash expenditures or payments, which such schedule shall be certified as true and complete by the Chief Accounting or Chief Financial Officer of the Company in all material respects on a monthly basis within five (5) business days after the end of each month or as otherwise reasonably requested by Holder.

 

6.           Events of Default.  This Note shall become immediately due and payable at the option of the Holder, upon any one or more of the following events or occurrences (“Events of Default”):

 

(a)           if any portion of this Note is not paid when due;

 

(b)           if the Company defaults in the observance or performance of any other material term, agreement, covenant or condition of this Note or of the binding provisions of the Letter Agreement, and the Company fails to remedy such default within fifteen (15) days after the date of such default, or, if such default is of such a nature that it cannot with due diligence be cured within said fifteen (15) day period, if the Company fails, within said fifteen (15) days, to commence all steps necessary to cure such default, and fail to complete such cure within forty five (45) days after the end of such fifteen (15) day period; provided, that any breach by or on behalf of the Company of the provisions entitled “Exclusivity” of the Letter Agreement shall immediately be an Event of Default.

 

(c)           if (i) any final judgment for the payment of money is rendered against the Company and the Company does not discharge the same or cause it to be discharged or vacated within ninety (90) days from the entry thereof, or does not appeal therefrom or from the order, decree or process upon which or pursuant to which said judgment was granted, based or entered, and does not secure a stay of execution pending such appeal within ninety (90)  days after the entry thereof or (ii) there is an acceleration of the obligations by any of the holders of the any existing or other indebtedness for borrowed money of the Company and either (A) the Company does not satisfy such obligations or stay such acceleration within ten (10) days or (B) any such holder initiates legal action to exercise its remedies with respect to any such indebtedness;

 

  

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(d)           if the Company makes an assignment for the benefit of creditors or if the Company generally does not pay its debts as they become due;

 

(e)           if a receiver, liquidator or trustee of the Company is appointed or if the Company is adjudicated a bankrupt or insolvent, or if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, is filed by or against, consented to, or acquiesced in, by the Company or if any proceeding for the dissolution or liquidation of the Company is instituted; however, if such appointment, adjudication, petition or proceeding is involuntary and is not consented to by the Company, upon the same not being discharged, stayed or dismissed within sixty (60) days; or

 

(f)           there is an event of default under any indebtedness for borrowed money which continues after the applicable cure or grace period, unless the Company satisfies such obligations within ten (10) days or any holder of such indebtedness initiates legal action to exercise its remedies with respect to any such indebtedness.

 

7.           Usury.  In no event shall the amount of interest paid or agreed to be paid hereunder exceed the highest lawful rate permissible under applicable law.  Any excess amount of deemed interest shall be null and void and shall not interfere with or affect the Company’s obligation to repay the principal of and interest on the Note.

 

8.           Mutilated, Destroyed, Lost or Stolen Notes.  In case this Note shall become mutilated or defaced, or be destroyed, lost or stolen, the Company shall execute and deliver a new note of like principal amount in exchange and substitution for the mutilated or defaced Note, or in lieu of and in substitution for the destroyed, lost or stolen Note.  In the case of a mutilated or defaced Note, the Holder shall surrender such Note to the Company.  In the case of any destroyed, lost or stolen Note, the Holder shall furnish to the Company: (a) evidence to its satisfaction of the destruction, loss or theft of such Note and (b) such security or indemnity as may be reasonably required by the Company to hold the Company harmless.

 

9.           Waiver of Demand, Presentment, etc.

 

(a)           The Company hereby expressly waives demand and presentment for payment, notice of nonpayment, protest, notice of protest, notice of dishonor, notice of acceleration or intent to accelerate, bringing of suit and diligence in taking any action to collect amounts called for hereunder and shall be directly and primarily liable for the payment of all sums owing and to be owing hereunder, regardless of and without any notice, diligence, act or omission as or with respect to the collection of any amount called for hereunder.

 

(b)           No delay or omission on the part of the Holder in exercising any right hereunder shall operate as a waiver of such right or of any other right of Holder, nor shall any delay, omission or waiver on any one occasion be deemed a bar to or waiver of the same or any other right on any future occasion.

 

10.           Payment.

 

(a)           Except as otherwise provided for herein, all payments with respect to this Note shall be made in lawful currency of the United States of America by check or wire transfer of immediately available funds, at the option of the Holder, at the principal office of the Holder or such other place or places or designated accounts as may be reasonably specified by the Holder of this Note in a written notice to the Company at least one (1) business day prior to payment.  Payment shall be credited first to the accrued interest then due and payable and the remainder applied to principal.

 

  

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(b)           This Note may be prepaid in full, but not in part, without payment of additional fee or penalty.

 

11.           Assignment.  The rights and obligations of the Company of this Note shall be binding upon, its successors or assigns.

 

12.           Waiver and Amendment.  Any provision of this Note, including, without limitation, the due date hereof, and the observance of any term hereof, may be amended, waived or modified (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of the Company and the Holder.

 

13.           Notices.  Any notice, request or other communication required or permitted hereunder shall be in writing and shall be deemed to have been duly given if personally delivered or mailed by registered or certified mail, postage prepaid, or delivered by facsimile transmission or .pdf, to the Company at the address or facsimile number set forth on the signature page hereof or to the Holder at its address or facsimile number set forth in the records of the Company.  Any party hereto may by notice so given change its address for future notice hereunder.  Notice shall conclusively be deemed to have been given when personally delivered or when deposited in the mail in the manner set forth above and shall be deemed to have been received when delivered or, if notice is given by facsimile transmission, when delivered with confirmation of receipt.

 

14.           Governing Law; Jurisdiction; Waiver of Jury Trial.

 

(a)           THIS NOTE SHALL BE ENFORCED, GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW.

 

(b)           THE COMPANY HEREBY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE STATE OF NEW YORK OR UNITED STATES FEDERAL COURTS LOCATED IN NEW YORK COUNTY, NEW YORK WITH RESPECT TO ANY DISPUTE ARISING UNDER THIS NOTE.  THE COMPANY IRREVOCABLY WAIVES THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH SUIT OR PROCEEDING.  THE COMPANY FURTHER AGREES THAT SERVICE OF PROCESS UPON IT MAILED BY FIRST CLASS MAIL SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON THE COMPANY IN ANY SUCH SUIT OR PROCEEDING.  NOTHING HEREIN SHALL AFFECT THE HOLDER’S RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.  THE COMPANY AGREES THAT A FINAL NON-APPEALABLE JUDGMENT IN ANY SUCH SUIT OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON SUCH JUDGMENT OR IN ANY OTHER LAWFUL MANNER.

 

  

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(c)           THE COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE.

 

15.           Severability.  If one or more provisions of this Note are held to be unenforceable under applicable law, such provisions shall be excluded from this Note, and the balance of this Note shall be interpreted as if such provisions were so excluded and shall be enforceable in accordance with its terms.

 

16.           Headings.  Section headings in this Note are for convenience only, and shall not be used in the construction of this Note.

 

17.           Costs of Collection.  The Company shall pay all attorney fees, and all other fees and disbursements of the Holder that are incurred to enforce the terms and conditions of this Note or to defend any action by Holder or any of its affiliates asserted by or on behalf of the Company.

 

[Signature Page Follows]

  

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IN WITNESS WHEREOF, the Company has caused this Note to be issued as of the date first above written.

 

 

	 	AEGIS IDENTITY SOFTWARE, INC. 

 

By:  /s/ Ralph Armigjo                                                      

        Name: Ralph Armigjo

        Title: Executive Chairman of the Board

 

Address for Notices:

 

750 West Hampden Avenue, Suite 500

Englewood, Colorado 80110

Attn:  Robert Lamvik, PresidentExhibit 4.1

NEITHER THE ISSUANCE AND SALE OF THE SECURITIES  REPRESENTED BY THIS  INSTRUMENT
NOR  THE  SECURITIES  INTO  WHICH  THIS  INSTRUMENT  IS  CONVERTIBLE  HAVE  BEEN
REGISTERED  UNDER THE  SECURITIES ACT OF 1933, AS AMENDED,  OR APPLICABLE  STATE
SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE,  SOLD,  TRANSFERRED
OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE  REGISTRATION STATEMENT UNDER
THE  SECURITIES  ACT OF 1933,  AS AMENDED,  OR (B) AN OPINION OF  COUNSEL,  IN A
GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT, THE
COST OF WHICH SHALL BE BORNE BY THE MAKERS HEREOF;  OR (II) UNLESS SOLD PURSUANT
TO RULE 144 UNDER SAID ACT.

                           CONVERTIBLE PROMISSORY NOTE

Original Principal Amount: $550,000.00                        San Antonio, Texas
Initial Conversion Price: $0.25                                  January 8, 2016

     FOR VALUE RECEIVED, UNIFIED SIGNAL, INC., a Nevada corporation ("UNIFIED"),
and TELBILL HOLDINGS,  LLC, a Washington limited liability company  ("CO-MAKER,"
and  together  with  Unified,  "MAKERS"),  each  having its  principal  place of
business at 5400 Carillon Point, Building 5000, 4th Floor, Kirkland,  Washington
98033,  jointly  and  severally  unconditionally  promise to pay to the order of
GETTYSBURG  HOLDINGS,  LLC, a Delaware limited liability company ("LENDER"),  or
its successors  and assigns,  at 8522 Broadway  Street,  Suite 209, San Antonio,
Texas  78217,  or such other place as Lender may  designate  in writing,  in the
manner provided  hereinafter,  the original  principal sum of FIVE HUNDRED FIFTY
THOUSAND AND NO/100 DOLLARS  ($550,000.00) (the "LOAN"),  together with interest
thereon and increases thereof, each as provided herein.

     1.  Definitions.  Certain  capitalized  terms  used  herein  shall have the
following meanings:

     (a) "AFFILIATE" means any Person that,  directly or indirectly  through one
or more intermediaries,  controls or is controlled by or is under common control
with a Person,  as such terms are used in and construed under Rule 405 under the
Securities Act.

     (b) "BANKRUPTCY  EVENT" means any of the following  events:  (i) a Maker or
any  subsidiary   thereof  commences  a  case  or  other  proceeding  under  any
bankruptcy, reorganization,  arrangement, adjustment of debt, relief of debtors,
dissolution,  insolvency  or  liquidation  or  similar  Law of any  jurisdiction
relating to a Maker or any subsidiary thereof; (ii) there is commenced against a
Maker  or any  subsidiary  thereof  any  such  case  or  proceeding  that is not
dismissed  within  sixty  (60)  days  after  commencement;  (iii) a Maker or any
subsidiary  thereof is adjudicated  insolvent or bankrupt or any order of relief
or other order approving any such case or proceeding is entered; (iv) a Maker or
any subsidiary  thereof suffers any appointment of any custodian or the like for
it or any  substantial  part of its property  that is not  discharged  or stayed
within  sixty (60) days after such  appointment;  (v) a Maker or any  subsidiary
thereof makes a general assignment for the benefit of creditors; (vi) a Maker or
any subsidiary thereof calls a meeting of its creditors with a view to arranging
a composition, adjustment or restructuring of its debts; or (vii) a Maker or any
subsidiary  thereof,  by any act or  failure  to act,  expressly  indicates  its
consent to,  approval of or  acquiescence  in any of the  foregoing or takes any
corporate or other action for the purpose of effecting any of the foregoing.

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     (c) "COLLATERAL"  means the all of the property of Makers,  or any of them,
and any other  party  pledging  such  property,  tangible or  intangible,  real,
personal or mixed, whether now owned or hereafter acquired, and now or hereafter
subject to or intended to be subject to the Loan Documents.

     (d) "COMMON  STOCK" means the common  stock of Unified  Signal,  Inc.,  par
value  $0.001  per  share,  and any other  class of  securities  into which such
securities may be reclassified or changed after the date hereof.

     (e) "CONVERSION AMOUNT" means, on any date, the then outstanding  principal
balance of the Loan, together with accrued and unpaid interest thereon,  and any
other amounts owing hereunder or under the other Loan Documents.

     (f)  "CONVERSION  SHARES" means,  collectively,  the shares of Common Stock
issuable  upon  conversion  of  this  Note  (including  all  components  of  the
Conversion Amount) in accordance with the terms hereof.

     (g) "GAAP" means  generally  accepted  accounting  principles  consistently
applied.

     (h) "GUARANTOR" means PARIS, HOLT, individually.

     (i) "GUARANTY"  means that certain  Continuing  Guaranty dated of even date
herewith by Guarantor.

     (j)  "INDEBTEDNESS"  means, with respect to any Person: (i) any liabilities
for borrowed money or amounts owed in excess of $50,000 in the aggregate  (other
than trade accounts payable  incurred in the ordinary course of business);  (ii)
all  guaranties,  endorsements  and other  contingent  obligations in respect of
indebtedness  of others,  whether or not the same are or should be  reflected in
such  Person's  consolidated  balance  sheet  (or  the  notes  thereto),  except
guaranties by endorsement of negotiable instruments for deposit or collection or
similar  transactions in the ordinary course of business;  and (iii) the present
value of any lease  payments  aggregating  in excess of $50,000 due under leases
required to be capitalized in accordance with GAAP.

     (k)  "LAW"  means  any  statute,  rule,  regulation,   ordinance  or  other
pronouncement  having the effect of law in the United States, any state, county,
city or other  political  subdivision  or of any other  governmental  authority,
including, without limitation, the common law.

     (l)  "LIEN"  means  any lien,  pledge,  hypothecation,  mortgage,  security
interest,   collateral  assignment,  claim,  lease,  sublease,  charge,  option,
easement,  right of way,  servitude,  adverse  claim and  demand of every  kind,
character and description whatsoever.

     (m) "LOAN DOCUMENTS" means this Note, each Security  Agreement executed and
delivered by Makers,  the  Guaranty  executed and  delivered by  Guarantor,  the
Telspace  Assignment  and  Assumption   Agreement,   the  Mcash  Assignment  and
Assumption  Agreement and any and all other documents and  instruments  executed
and delivered to Lender in connection  with the Loan and any and all extensions,
modifications and renewals thereof.

     (n) "MCASH"  means MCASH  HOLDINGS,  LLC, a  Washington  limited  liability
company with its principal address at 5400 Carillon Point, Kirkland,  Washington
98033.

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     (o)  "MCASH  ASSIGNMENT  AND  ASSUMPTION   AGREEMENT"  means  that  certain
Assignment  and Assumption  Agreement  with Licensor  Consent dated of even date
herewith,  by and between  Co-Maker and  Telbill,  assigning  the Mcash  License
Agreement to Telbill.

     (p) "MCASH LICENSE AGREEMENT" means that certain Software License Agreement
dated February 19, 2013, by and between  Co-Maker and Mcash,  and all amendments
thereto.

     (q) "NOTE" means this  Convertible  Promissory  Note,  which  evidences the
Loan, effective as of the date set forth above, by Makers,  payable to the order
of Lender.

     (r) "NOTE  HOLDER" means Lender and anyone who takes this Note by purchase,
assignment or otherwise and who is entitled to receive payments hereunder.

     (s) "OBLIGOR"  means  Makers,  Guarantor and any Person which is or becomes
obligated to pay the Loan, whether primarily, as cosigner,  surety or otherwise,
or has pledged any property as security for the Loan.

     (t)  "PERSON"  means  any  natural  person,  corporation,  business  trust,
association,  company, limited liability company, joint venture,  partnership or
government or any agency or political subdivision thereof.

     (u) "SEC" means the United States Securities and Exchange Commission.

     (v) "SECURITIES ACT" means the Securities Act of 1933, as amended,  and the
rules and regulations promulgated thereunder.

     (w) "TAX" and  "TAXES"  means any  taxes,  charges,  fees,  levies or other
assessments  imposed by any  governmental  authority,  whether  disputed or not,
including, without limitation, income, capital gains, estimated,  alternative or
add-on minimum,  excise,  property,  sales, transfer,  withholding,  employment,
payroll,  gross  receipts,   windfall  profits,   license,   severance,   stamp,
occupation,  environmental,  customs  duties,  capital  stock,  value-added  and
franchise taxes, and including any interest, penalties or additions attributable
to or imposed on or with respect to such assessments,  as well as any obligation
to indemnify or  otherwise  assume or succeed to the tax  liability of any other
Person.

     (x) "TELBILL" means TELBILL,  LLC, a Washington  limited  liability company
with its principal  address at 5400 Carillon  Point,  Building  5000, 4th Floor,
Kirkland, Washington 98033.

     (y) "TELSPACE" means TELSPACE,  LLC, a Washington limited liability company
with its principal address at 5400 Carillon Point, Kirkland, Washington 98033.

     (z)  "TELSPACE  ASSIGNMENT  AND  ASSUMPTION  AGREEMENT"  means that certain
Assignment  and Assumption  Agreement  with Licensor  Consent dated of even date
herewith,  by and between  Co-Maker and Telbill,  assigning the Telspace License
Agreement to Telbill.

     (aa)  "TELSPACE  LICENSE  AGREEMENT"  means that certain  Software  License
Agreement dated February 26, 2013, by and between Co-Maker and Telspace, and all
amendments thereto.

     (bb)  "TRADING  DAY" means any day on which the New York Stock  Exchange is
open for trading.

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     (cc)  "UNIFIED SEC FILINGS"  means all filings made by Unified with the SEC
pursuant to the Securities Exchange Act of 1934, as amended.

     2.  Interest  Rate.  The  unpaid  principal  balance of the Loan shall bear
interest  prior to maturity at the fixed rate of TEN PERCENT  (10.0%) per annum.
Notwithstanding  any  provision of this Note,  Lender does not intend to charge,
and Makers shall not be required to pay, any amount of interest or other charges
in excess of the maximum  permitted by applicable  Law. Makers agree that during
the full  term  hereof,  the  maximum  lawful  interest  rate  for this  Note as
determined  under Texas Law shall be the indicated  rate ceiling as specified in
Chapter 303 of the Texas Finance  Code, as amended,  and Chapter 1D of the Texas
Credit  Title,  as amended.  Further,  to the extent that any other  lawful rate
ceiling  exceeds the rate  ceiling so  determined  then the higher rate  ceiling
shall apply.  Any payment in excess of such maximum  shall be refunded to Makers
or credited against principal,  at the option of Note Holder.  Interest shall be
computed on the basis of a 360-day year and the actual  number of days  elapsed.
Any  amounts  of  principal  which are not paid when due under  this Note  shall
continue to bear interest until paid.

     3.  Advance of  Additional  Funds.  Lender  may  advance  additional  funds
hereunder (over and above the original principal amount of the Loan) in order to
fund the premiums on the Insurance Policies (as defined below) to be obtained by
Unified in accordance with Section 8(d) hereof.  Such additional  funds advanced
by Lender shall be added to the outstanding  principal  balance of the Loan, and
shall  bear  interest  at the rate and in  accordance  with the  terms set forth
herein.  All  references  herein and in the other Loan  Documents  to the "Loan"
shall include amounts advanced  pursuant to this Section 3. Lender,  in its sole
discretion,  shall have the right to  determine  whether  and in what  amount to
advance  additional  funds  hereunder,  and any  determination  by Lender not to
advance the full  amount of the  premiums on the  Insurance  Policies  shall not
affect Makers' or any other Obligors'  obligations  hereunder or under the other
Loan Documents.

     4. Payments.  All payments received hereunder shall first be applied to the
payment of any expense or charges  payable  hereunder  or under any of the other
Loan Documents, then to accrued and unpaid interest, with the balance applied to
principal,  or in such other order as Note Holder  shall  determine  in its sole
discretion. No payments of principal or accrued and unpaid interest shall be due
and payable until JULY 8, 2016 (the "MATURITY  DATE"),  at which time the entire
outstanding  principal balance of the Loan, together with all accrued and unpaid
interest  thereon,  and any other unpaid amounts advanced or incurred by Lender,
shall be finally  due and  payable in full.  Amounts  due under this Note may be
prepaid at any time, in whole or in part, without penalty.

     5. Conversion.  The conversion rights set forth herein shall remain in full
force and effect  immediately from the date hereof and until the Note is paid in
full, regardless of the occurrence of an Event of Default (as defined below).

     (a) Voluntary Conversion. At any time or times on or after the date hereof,
Note Holder  shall be entitled to convert any portion of the  Conversion  Amount
into fully paid and  nonassessable  shares of Common  Stock in  accordance  with
Section 5(c), at the Conversion Price.  Note Holder shall effect  conversions by
delivering  to  Makers a Notice  of  Conversion,  the form of which is  attached
hereto as ANNEX A (each,  a "NOTICE  OF  CONVERSION"),  specifying  therein  the
principal  amount  of this  Note (and any  other  components  of the  Conversion
Amount) to be converted and the date on which such conversion  shall be effected
(such date,  the  "CONVERSION  DATE").  If no Conversion  Date is specified in a

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Notice of Conversion,  the Conversion Date shall be the date that such Notice of
Conversion is deemed delivered hereunder. To effect conversions hereunder,  Note
Holder shall not be required to physically  surrender this Note to Makers unless
the  entire  principal  amount of this Note has been so  converted.  Conversions
hereunder shall have the effect of lowering the outstanding  principal amount of
this Note (and, as applicable, any other components of the Conversion Amount) in
an amount equal to the principal amount converted (or, in the case of such other
components of the Conversion Amount, in the amounts  converted,  as applicable).
Note Holder and Makers shall maintain  records showing the Conversion  Amount(s)
(and the  components  thereof)  converted  and the  date of such  conversion(s).
Makers may  deliver an  objection  to any  Notice of  Conversion  within two (2)
Business  Days of  delivery of such  Notice of  Conversion.  In the event of any
dispute or  discrepancy,  the records of Note Holder  shall be  controlling  and
determinative in the absence of manifest error. NOTE HOLDER, AND ANY ASSIGNEE BY
ACCEPTANCE OF THIS NOTE, ACKNOWLEDGE AND AGREE THAT, BY REASON OF THE PROVISIONS
OF THIS  PARAGRAPH,  FOLLOWING  CONVERSION OF A PORTION OF THIS NOTE, THE UNPAID
AND UNCONVERTED PRINCIPAL AMOUNT OF THIS NOTE MAY BE LESS THAN THE AMOUNT STATED
ON THE FACE HEREOF.

     (b) Conversion  Price.  The conversion  price for the Conversion  Amount in
connection  with  voluntary  conversions  by Note  Holder for a single  share of
Common Stock shall be the lowest of (i) $0.25;  or (ii) after the  occurrence of
an  Event  of  Default,  one-half  (1/2)  of  the  Conversion  Price  in  effect
immediately  prior to the  occurrence of the Event of Default or, if lower,  the
volume  weighted  average price,  as determined by Note Holder in its reasonable
discretion,  on the date immediately preceding the Event of Default,  subject to
adjustment herein (the "CONVERSION PRICE").

     (c) Mechanics of Conversion.

     (i) Conversion  Shares Issuable Upon  Conversion.  The number of Conversion
Shares issuable upon a conversion  hereunder shall be determined by the quotient
obtained  by  dividing  (x) the  Conversion  Amount to be  converted  by (y) the
Conversion Price.

     (ii)  Delivery of  Certificate  Upon  Conversion.  Not later than three (3)
Trading Days after each  Conversion Date (the "SHARE  DELIVERY  DATE"),  Unified
shall  deliver,  or cause to be  delivered,  to Note  Holder  a  certificate  or
certificates  representing the Conversion  Shares which, on or after the earlier
of (i) the six (6)  month  anniversary  of the  date of this  Note;  or (ii) the
effective date of a registration  statement  including such  Conversion  Shares,
shall be free of restrictive legends and trading  restrictions  representing the
number of Conversion  Shares being acquired upon the conversion of this Note. If
required by the transfer agent in connection with a request to issue  Conversion
Shares free of restrictive  legend and trading  restrictions  as contemplated by
the preceding sentence, Unified will promptly provide the transfer agent a legal
opinion of counsel to Unified in form and  substance  acceptable to the transfer
agent to permit such issuance.  Without limiting Unified's obligation to provide
any such  required  legal  opinion or liability for failing to timely do so, and
without  imposing any obligation on Note Holder,  if Unified fails to do provide
such legal opinion, Unified authorizes and shall authorize the transfer agent to
accept such legal  opinion from such legal  counsel as shall be selected by Note
Holder in its sole and absolute  discretion  and the cost of which legal opinion
shall be borne by  Unified.  On or after  the  earlier  of (i) the six (i) month
anniversary  of the  date  of  this  Note;  or  (ii)  the  effective  date  of a
registration  statement including such Conversion Shares,  Unified shall deliver
any certificate or  certificates  required to be delivered by Unified under this

                                       5
<PAGE>
Section 5(c)  electronically  through the  Depository  Trust Company  ("DTC") or
another established clearing corporation performing similar functions,  provided
the Common  Stock is DTC eligible and the  transfer  agent  participates  in the
Deposit Withdrawal at Custodian  ("DWAC") system.  Such delivery must be made on
or before the Share Delivery Date.

     (iii)  Failure  to Deliver  Certificates.  If, in the case of any Notice of
Conversion, such certificate or certificates are not delivered to or as directed
by Note Holder by the Share  Delivery  Date,  Note  Holder  shall be entitled to
elect by written  notice to Unified at any time on or before its receipt of such
certificate or certificates,  to rescind such Conversion, in which event Unified
shall  promptly  return to Note Holder this Note and Note Holder shall  promptly
return to Unified the Common Stock  certificates  issued to Note Holder pursuant
to the rescinded Conversion Notice.

     (iv) Obligation Absolute; Partial Liquidated Damages. Unified's obligations
to issue and deliver the  Conversion  Shares  (or, in the case of  Co-Maker,  to
cause the issuance and delivery of the  Conversion  Shares) upon  conversion  of
this Note in  accordance  with the terms hereof are absolute and  unconditional,
irrespective  of any action or inaction by Note Holder to enforce the same,  any
waiver or consent  with  respect to any  provision  hereof,  the recovery of any
judgment  against any Person or any action to enforce  the same,  or any setoff,
counterclaim,  recoupment,  limitation or termination,  or any breach or alleged
breach by Note Holder or any other  Person of any  obligation  to a Maker or any
violation or alleged  violation of Law by Note Holder or any other  Person,  and
irrespective  of  any  other  circumstance  which  might  otherwise  limit  such
obligation  of a Maker to Note Holder in  connection  with the  issuance of such
Conversion Shares; provided,  however, that such delivery shall not operate as a
waiver by Makers of any such action a Maker may have against Note Holder. In the
event Note Holder  shall elect to convert any or all of the  Conversion  Amount,
Makers may not refuse  conversion  based on any claim that Note Holder or anyone
associated or  affiliated  with Note Holder has been engaged in any violation of
Law,  agreement or for any other reason,  unless an injunction  from a court, on
notice to Note Holder, restraining and or enjoining conversion of all or part of
this Note shall have been sought and obtained, and Makers post a surety bond for
the benefit of Note Holder in the amount of one hundred fifty percent  (150%) of
the Conversion  Amount of this Note,  which is subject to the injunction,  which
bond shall remain in effect until the resolution of the  underlying  dispute and
the  proceeds  of which shall be payable to Note Holder to the extent it obtains
judgment. In the absence of such injunction, Unified shall issue (or in the case
of Co-Maker, cause to be issued) Conversion Shares or, if applicable,  pay cash,
upon a properly noticed conversion.  If Makers fail for any reason to deliver to
Note Holder such certificate or certificates pursuant to Section 5(c)(ii) by the
Share  Delivery  Date,  Makers shall pay to Note Holder,  in cash, as liquidated
damages  and not as a  penalty,  for each  $1,000  of  Conversion  Shares  being
converted  (based on the  higher  of the  Conversion  Price or  volume  weighted
average price on the Share Delivery Date), $100 per Trading Day for each Trading
Day after such Share Delivery Date until such certificates are delivered or Note
Holder  rescinds  such  conversion;  provided  that if such  certificate(s)  are
delivered to Note Holder within seven (7) calendar days of the Conversion  Date,
no such amounts  shall accrue in respect of such failure to timely  deliver such
certificate(s).  Such  amounts  shall be due and  payable  immediately.  Nothing
herein shall limit Note Holder's  right to pursue  actual  damages or declare an
Event of  Default  under  this Note or the other Loan  Documents  for  Unified's
failure to deliver Conversion Shares within the period specified herein and Note
Holder shall have the right to pursue all remedies available to it hereunder, at
law or in equity including, without limitation, a decree of specific performance

                                       6
<PAGE>
and/or  injunctive  relief (it being  understood  that Makers waive any right or
requirement  for the  posting of a bond in  connection  with any such action for
specific  performance  or  injunctive  relief).  The exercise of any such rights
shall not prohibit Note Holder from seeking to enforce  damages  pursuant to any
other provision hereof or under applicable Law.

     (v) Compensation for Buy-In on Failure to Timely Deliver  Certificates Upon
Conversion. In addition to any other rights available to Note Holder, if Unified
fails for any reason to deliver to Note Holder such  certificate or certificates
by the Share Delivery Date pursuant to Section 5(c)(ii), and if after such Share
Delivery Date Note Holder is required by its  brokerage  firm to purchase (in an
open market transaction or otherwise), or Note Holder or Note Holder's brokerage
firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a
sale by Note Holder of the  Conversion  Shares which Note Holder was entitled to
receive upon the  conversion  relating to such Share Delivery Date (a "BUY-IN"),
then  Makers  shall (A) pay in cash to Note  Holder  (in  addition  to any other
remedies  available to or elected by Note  Holder) the amount,  if any, by which
(x) Note Holder's total purchase price (including any brokerage commissions) for
the Common  Stock so  purchased  exceeds  (y) the  product of (1) the  aggregate
number of shares of Common  Stock that Note Holder was  entitled to receive from
the  conversion  at issue  multiplied  by (2) the actual sale price at which the
sell order giving rise to such purchase  obligation was executed  (including any
brokerage commissions); and (B) at the option of Note Holder, either reissue (if
surrendered)  this Note in a principal  amount equal to the principal  amount of
the  attempted  conversion  (in  which  case  such  conversion  shall be  deemed
rescinded)  or deliver to Note Holder the number of shares of Common  Stock that
would  have  been  issued if  Unified  had  timely  complied  with its  delivery
requirements under Section 5(c)(ii). By way of example, if Note Holder purchases
Common  Stock  having a total  purchase  price of $11,000 to cover a Buy-In with
respect to an attempted conversion of this Note with respect to which the actual
sale price of the Conversion Shares (including any brokerage commissions) giving
rise to such purchase  obligation was a total of $10,000 under clause (A) of the
immediately  preceding  sentence,  Makers  shall be  required  to pay the Holder
$1,000.  Note Holder shall provide Makers written notice  indicating the amounts
payable to Note  Holder in respect of the Buy-In  and,  upon  request of Makers,
evidence of the amount of such loss.  Nothing  herein shall limit Note  Holder's
right to pursue  any other  remedies  available  to it  hereunder,  at law or in
equity including,  without limitation,  a decree of specific  performance and/or
injunctive   relief  with  respect  to  Unified's   failure  to  timely  deliver
certificates representing shares of Common Stock upon conversion of this Note as
required pursuant to the terms hereof.

     (vi) Reservation of Shares Issuable Upon Conversion. Unified covenants that
it will at all  times  reserve  and keep  available  out of its  authorized  and
unissued shares of Common Stock for the sole purpose of issuance upon conversion
of this Note as herein provided, free from preemptive rights or any other actual
contingent purchase rights of Persons other than Note Holder, not less than such
aggregate  number of shares of the Common  Stock as shall be  issuable  upon the
conversion of the then  outstanding  principal  amount of this Note and interest
which has accrued  and would  accrue on such  principal  amount,  assuming  such
principal  amount was not converted  through the Maturity  Date, as well as upon
conversion  of any  other  amounts  owed  hereunder  or  under  the  other  Loan
Documents.  Unified  covenants  that all shares of Common Stock that shall be so
issuable shall, upon issue, be duly authorized,  validly issued,  fully paid and
nonassessable.

                                       7
<PAGE>
     (vii)  Fractional  Shares.  No  fractional  shares  or  scrip  representing
fractional  shares shall be issued upon the  conversion  of this Note. As to any
fraction of a share which Note Holder  would  otherwise  be entitled to purchase
upon  such  conversion,  Makers  shall  at  their  election,  either  pay a cash
adjustment in respect of such final fraction in an amount equal to such fraction
multiplied by the Conversion Price or round up to the next whole share.

     (viii) Transfer Taxes and Expenses. The issuance of certificates for shares
of the Common Stock on conversion  of this Note shall be made without  charge to
Note Holder for any  documentary  stamp or similar  Taxes that may be payable in
respect of the issue or delivery of such  certificates,  provided that,  Unified
shall not be  required  to pay any Tax that may be  payable  in  respect  of any
transfer  involved in the  issuance and  delivery of any such  certificate  upon
conversion in a name other than that of Note Holder so converted.  Unified shall
pay all transfer  agent fees  required for same-day  processing of any Notice of
Conversion.

     (d) Certain Adjustments.

     (i) Stock  Dividends and Stock Splits.  If Unified,  at any time while this
Note is outstanding: (A) pays a stock dividend or otherwise makes a distribution
or distributions  payable in shares of Common Stock on shares of Common Stock or
any Common Stock equivalents  (which,  for avoidance of doubt, shall not include
any shares of Common Stock issued by Unified upon conversion of the Notes);  (B)
subdivides  outstanding  shares of Common Stock into a larger  number of shares;
(C) combines  (including by way of a reverse stock split)  outstanding shares of
Common Stock into a smaller number of shares;  or (D) issues,  in the event of a
reclassification  of shares of the Common Stock,  any shares of capital stock of
the Company,  then the  Conversion  Price shall be  multiplied  by a fraction of
which the numerator shall be the number of shares of Common Stock (excluding any
treasury shares of Unified)  outstanding  immediately  before such event, and of
which the denominator  shall be the number of shares of Common Stock outstanding
immediately  after such event. Any adjustment made pursuant to this Section 5(d)
shall become effective  immediately  after the record date for the determination
of  stockholders  entitled to receive such  dividend or  distribution  and shall
become  effective  immediately  after  the  effective  date  in  the  case  of a
subdivision, combination or re-classification.

     (ii) Subsequent Rights Offerings.  In addition to any adjustments  pursuant
to Section  5(d)(i)  above,  if, at any time while any amounts  owing under this
Note or the other Loan Documents remains outstanding,  Unified grants, issues or
sells any  Common  Stock  equivalents  or rights to  purchase  stock,  warrants,
securities  or other  property  pro rata to the  record  holders of any class of
shares of Common  Stock  (the  "PURCHASE  RIGHTS"),  then  Note  Holder  will be
entitled to acquire,  upon the terms  applicable  to such Purchase  Rights,  the
aggregate  Purchase  Rights which Note Holder could have acquired if Note Holder
had held  the  number  of  shares  of  Common  Stock  acquirable  upon  complete
conversion of this Note  immediately  before the date on which a record is taken
for the grant,  issuance or sale of such Purchase Rights,  or, if no such record
is taken,  the date as of which the record holders of shares of Common Stock are
to be determined for the grant, issue or sale of such Purchase Rights.

     (iii) Pro Rata Distributions. During such time as this Note is outstanding,
if Unified  shall  declare or make any  dividend  or other  distribution  of its
assets (or rights to acquire its  assets) to holders of shares of Common  Stock,
by way of return of capital or otherwise  (including,  without  limitation,  any
distribution of cash, stock or other securities, property or options by way of a
dividend,  spin  off,  reclassification,   corporate  rearrangement,  scheme  of

                                       8
<PAGE>
arrangement or other similar transaction) (a "DISTRIBUTION"),  at any time after
the  issuance  of this Note,  then,  in each such  case,  Note  Holder  shall be
entitled to participate in such Distribution to the same extent that Note Holder
would have participated  therein if Note Holder had held the number of shares of
Common Stock acquirable upon complete  exercise of this Note immediately  before
the date of which a record is taken for such Distribution, or, if no such record
is taken,  the date as of which the record holders of shares of Common Stock are
to be determined for the participation in such Distribution.

     (iv)  Fundamental  Transaction.   If,  at  any  time  while  this  Note  is
outstanding,  (A)  Unified,  directly  or  indirectly,  in one or  more  related
transactions effects any merger or consolidation of Unified with or into another
Person; (B) Unified,  directly or indirectly,  effects any sale, lease, license,
assignment,  transfer,  conveyance or other  disposition of all or substantially
all of its assets in one or a series of related transactions; (C) any, direct or
indirect,  purchase offer, tender offer or exchange offer (whether by Unified or
another  Person) is  completed  pursuant  to which  holders of Common  Stock are
permitted to sell, tender or exchange their shares for other securities, cash or
property and has been  accepted by the holders of fifty percent (50%) or more of
the outstanding  Common Stock;  (D) Unified,  directly or indirectly,  in one or
more  related  transactions  effects  any  reclassification,  reorganization  or
recapitalization  of the Common Stock or any compulsory share exchange  pursuant
to which the Common Stock is  effectively  converted into or exchanged for other
securities,  cash or property; or (E) Unified, directly or indirectly, in one or
more related  transactions  consummates a stock or share  purchase  agreement or
other business  combination  (including,  without limitation,  a reorganization,
recapitalization, spin-off or scheme of arrangement) with another Person whereby
such other Person  acquires  more than fifty  percent  (50%) of the  outstanding
shares of Common  Stock (not  including  any shares of Common  Stock held by the
other Person or other  Persons  making or party to, or  associated or affiliated
with  the  other  Persons  making  or party  to,  such  stock or share  purchase
agreement or other business  combination)  (each a  "FUNDAMENTAL  TRANSACTION"),
then,  upon any subsequent  conversion of this Note,  Note Holder shall have the
right to receive,  for each Conversion  Share that would have been issuable upon
such  conversion  immediately  prior  to  the  occurrence  of  such  Fundamental
Transaction,  the number of shares of Common Stock of the successor or acquiring
corporation  or  of  Unified,  if it  is  the  surviving  corporation,  and  any
additional consideration (the "ALTERNATE  CONSIDERATION") receivable as a result
of such  Fundamental  Transaction  by a holder of the number of shares of Common
Stock for which this Note is convertible  immediately  prior to such Fundamental
Transaction.  For  purposes of any such  conversion,  the  determination  of the
Conversion  Price shall be  appropriately  adjusted  to apply to such  Alternate
Consideration based on the amount of Alternate Consideration issuable in respect
of one (1) share of Common Stock in such  Fundamental  Transaction,  and Unified
shall  apportion the  Conversion  Price among the Alternate  Consideration  in a
reasonable manner  reflecting the relative value of any different  components of
the Alternate Consideration.  If holders of Common Stock are given any choice as
to the securities, cash or property to be received in a Fundamental Transaction,
then  Note  Holder  shall  be  given  the  same  choice  as  to  the   Alternate
Consideration  it  receives  upon any  conversion  of this Note  following  such
Fundamental  Transaction.   Unified  shall  cause  any  successor  entity  in  a
Fundamental  Transaction  in which Unified is not the survivor  (the  "SUCCESSOR
ENTITY") to assume in writing all of the  obligations  of Makers under this Note
and the other Loan  Documents in accordance  with the provisions of this Section
5(d)(iv)  pursuant  to  written  agreements  in form  and  substance  reasonably
satisfactory  to Note Holder and approved by Note Holder  (without  unreasonable

                                       9
<PAGE>
delay) prior to such  Fundamental  Transaction  and shall, at the option of Note
Holder,  deliver to Note  Holder in  exchange  for this Note a  security  of the
Successor Entity evidenced by a written instrument substantially similar in form
and substance to this Note which is convertible  for a  corresponding  number of
shares  of  capital  stock  of such  Successor  Entity  (or its  parent  entity)
equivalent  to the  shares  of  Common  Stock  acquirable  and  receivable  upon
conversion  of this  Note  prior  to such  Fundamental  Transaction,  and with a
conversion  price which applies the conversion price hereunder to such shares of
capital  stock (but taking  into  account  the  relative  value of the shares of
Common  Stock  pursuant to such  Fundamental  Transaction  and the value of such
shares of  capital  stock,  such  number of  shares  of  capital  stock and such
conversion  price being for the purpose of protecting the economic value of this
Note immediately prior to the consummation of such Fundamental Transaction), and
which is reasonably  satisfactory in form and substance to Note Holder. Upon the
occurrence  of any such  Fundamental  Transaction,  the  Successor  Entity shall
succeed  to,  and be  substituted  for (so that  from and after the date of such
Fundamental  Transaction,  the  provisions  of  this  Note  and the  other  Loan
Documents  referring to "Unified" shall refer instead to the Successor  Entity),
and may  exercise  every right and power of Unified and shall  assume all of the
obligations  of Unified  under this Note and the other Loan  Documents  with the
same effect as if such Successor Entity had been named as Unified herein.

     (v)  Subsequent   Equity  Sales.  If,  at  any  time  while  this  Note  is
outstanding,  Unified or any subsidiary thereof, as applicable,  sells or grants
any option to  purchase or sells or grants any right to  reprice,  or  otherwise
disposes of or issues (or announces any sale, grant or any option to purchase or
other disposition),  any Common Stock or Common Stock equivalents  entitling any
Person to acquire shares of Common Stock at an effective price per share that is
lower than the then  Conversion  Price (such lower price,  the "BASE  CONVERSION
PRICE" and such issuances,  collectively,  a "DILUTIVE ISSUANCE") (if the holder
of the Common  Stock or Common  Stock  equivalents  so issued shall at any time,
whether by operation of purchase price adjustments,  reset provisions,  floating
conversion,  exercise  or  exchange  prices or  otherwise,  or due to  warrants,
options or rights per share which are issued in connection  with such  issuance,
be entitled to receive  shares of Common Stock at an  effective  price per share
that is lower than the Conversion  Price,  such issuance shall be deemed to have
occurred  for  less  than the  Conversion  Price  on such  date of the  Dilutive
Issuance),  then the  Conversion  Price  shall  be  reduced  to  equal  the Base
Conversion  Price.  Such adjustment  shall be made whenever such Common Stock or
Common  Stock  equivalents  are  issued.   Notwithstanding  the  foregoing,   no
adjustment  will be made  under  this  Section  5(d)(v)  in respect of an exempt
issuance.  If Unified enters into a variable rate transaction,  Unified shall be
deemed to have issued  Common  Stock or Common Stock  equivalents  at the lowest
possible  conversion  price  at  which  such  securities  may  be  converted  or
exercised.  Unified  shall  notify  Note  Holder in  writing,  no later than the
Trading  Day  following  the  issuance  of any  Common  Stock  or  Common  Stock
equivalents  subject to this Section 5(d)(v),  indicating therein the applicable
issuance price, or applicable reset price, exchange price,  conversion price and
other pricing terms (such notice, the "DILUTIVE ISSUANCE NOTICE").  For purposes
of  clarification,  whether or not Unified  provides a Dilutive  Issuance Notice
pursuant to this Section 5(d)(v),  upon the occurrence of any Dilutive Issuance,
Note Holder is entitled to receive a number of Conversion  Shares based upon the
Base Conversion Price on or after the date of such Dilutive Issuance, regardless
of whether Note Holder  accurately  refers to the Base  Conversion  Price in the
Notice of Conversion.

     (vi)  Calculations.  All calculations under this Section 5(d) shall be made
to the nearest cent or the nearest  1/100th of a share,  as the case may be. For

                                       10
<PAGE>
purposes of this Section 5(d), the number of shares of Common Stock deemed to be
issued  and  outstanding  as of a given  date  shall be the sum of the number of
shares of Common Stock  (excluding  any treasury  shares of Unified)  issued and
outstanding.

     (vii) Notice to Note Holder.

     (A)  Adjustment  to  Conversion  Price.  Whenever the  Conversion  Price is
adjusted pursuant to any provision of this Section 5(d),  Unified shall promptly
deliver to Note Holder a notice  setting forth the  Conversion  Price after such
adjustment  and setting  forth a brief  statement  of the facts  requiring  such
adjustment.

     (B) Notice to Allow  Conversion  by Holder.  If (1) Unified shall declare a
dividend (or any other  distribution in whatever form) on the Common Stock;  (2)
Unified shall declare a special nonrecurring cash dividend on or a redemption of
the Common Stock; (3) Unified shall authorize the granting to all holders of the
Common  Stock of rights or warrants to  subscribe  for or purchase any shares of
capital  stock  of  any  class  or of  any  rights;  (4)  the  approval  of  any
stockholders   of   Unified   shall  be   required   in   connection   with  any
reclassification  of the  Common  Stock,  any  consolidation  or merger to which
Unified is a party,  any sale or  transfer  of all or  substantially  all of the
assets of Unified,  or any compulsory share exchange whereby the Common Stock is
converted  into  other  securities,  cash  or  property;  or (5)  Unified  shall
authorize its voluntary or involuntary dissolution, liquidation or winding up of
its affairs,  then, in each case,  Makers shall cause to be filed at each office
or agency maintained for the purpose of conversion of this Note, and shall cause
to be delivered to Note Holder at its address set forth herein,  at least twenty
(20) calendar days prior to the applicable  record or effective date hereinafter
specified,  a notice  stating  (x) the date on which a record is to be taken for
the purpose of such dividend,  distribution,  redemption, rights or warrants, or
if a record is not to be taken,  the date as of which the  holders of the Common
Stock of record to be  entitled  to such  dividend,  distributions,  redemption,
rights  or  warrants  are to be  determined;  or (y)  the  date  on  which  such
reclassification,  consolidation,  merger,  sale,  transfer or share exchange is
expected to become  effective or close,  and the date as of which it is expected
that holders of the Common  Stock of record shall be entitled to exchange  their
shares of the Common Stock for  securities,  cash or other property  deliverable
upon such  reclassification,  consolidation,  merger,  sale,  transfer  or share
exchange, provided that the failure to deliver such notice or any defect therein
or in the delivery thereof shall not affect the validity of the corporate action
required to be specified in such notice.  To the extent that any notice provided
hereunder constitutes, or contains,  material,  non-public information regarding
Unified  or any of its  subsidiaries,  Unified  shall  simultaneously  file such
notice with the SEC pursuant to a Current  Report on Form 8-K. Note Holder shall
remain entitled to convert this Note during the 20-day period  commencing on the
date of such notice  through the  effective  date of the event  triggering  such
notice except as may otherwise be expressly set forth herein.

     6.  Security.  The Loan  evidenced  by this Note is secured by, among other
things,  the Loan Documents.  This Note shall  evidence,  and the Loan Documents
shall  secure,  the  indebtedness  described  herein  and any  further  loans or
advances  that may be made to or on behalf of Makers by Note  Holder at any time
or times  hereafter  under the Loan  Documents,  and any such loans or  advances
shall be added to the  Indebtedness  evidenced  by this  Note,  and  shall  bear
interest at the  applicable  rates  specified  herein,  unless a greater rate of
interest is specified in any other note or evidence of Indebtedness  relating to
such other loan or advance.

                                       11
<PAGE>
     7. Representations and Warranties. Makers each hereby jointly and severally
represent and warrant to Note Holder that as of the date hereof and after giving
effect to the Loan:

     (a) Organization;  Authorization;  Power and Authority.  Each Maker is duly
organized,  validly existing and in good standing under the laws of the state in
which it is organized.  Each Maker has all requisite  power and authority to (i)
execute and deliver this Note and the other Loan  Documents,  and perform all of
their  respective  obligations  hereunder  and  thereunder;  and  (ii)  own  its
properties  and carry on its business as now presently  conducted and as planned
to be conducted.

     (b)  Validity of Loan  Documents.  The Loan,  as evidenced by this Note and
secured  by the  Loan  Documents,  constitutes  the  legal,  valid  and  binding
obligation of Makers,  enforceable  against Makers in accordance  with the terms
thereof,  except to the  extent  such  enforceability  may be limited by (i) any
applicable liquidation,  conservatorship,  bankruptcy,  moratorium,  insolvency,
reorganization  or similar Laws  affecting  the rights and remedies of creditors
generally;  and (ii) general principles of equity. The Loan is secured by valid,
perfected and enforceable  first priority Liens in and to all of the Collateral.
The  execution  and delivery of this Note and the other Loan  Documents  and the
consummation of the transactions  contemplated hereby and thereby: (A) have been
duly and validly  authorized and approved by all necessary  corporate  action of
each  Maker;  (B)  do  not  violate  Makers'  organizational  documents  or  any
applicable Laws, court orders or decrees to which any Maker or its properties is
bound;  (C) do not and will not,  with or  without  the  giving of notice or the
passage of time,  or both,  violate,  constitute a breach of,  conflict  with or
result in the  creation or  imposition  of any Lien or give rise to any right of
termination,  cancellation  or  acceleration  under  any note,  bond,  mortgage,
indenture or other agreement to which any Maker or its properties is bound.

     (c) Other  Indebtedness.  Except as previously  disclosed to Note Holder in
writing  and other than the  Indebtedness  created by this Note,  Makers have no
Indebtedness, except for (i) accounts payable, trade payables, Taxes and similar
short-term  liabilities  incurred in the ordinary  course of business;  and (ii)
obligations  under  existing  leases of real or  personal  property  used in the
ordinary course of business.

     (d) Accuracy of Financial Information.  All financial and other information
and  documentation  relating thereto  submitted to Lender in connection with the
Loan is true, correct and complete as of the dates set forth therein,  and there
has been no material  adverse change in Makers'  financial  condition  since the
date(s) of such documents.

     (e) No  Default  or Event of  Default.  No  default  by  Makers or Event of
Default has  occurred and is  continuing,  or will occur  immediately  after the
consummation of the transactions contemplated hereby.

     (f) Consents and Approvals. Except as otherwise provided below, no consent,
approval,   authorization,   license,   order  or  permit  of,  or  declaration,
registration or filing with, or notification to, any  governmental  authority or
any other Person,  is required in connection  with the  execution,  delivery and
performance  of  this  Note  and  the  other  Loan  Documents  by  Makers,   the
consummation of the transactions  contemplated  hereby or thereby, or the pledge
of  the   Collateral   in   accordance   with  the  terms  hereof  and  thereof.
Notwithstanding  the foregoing Makers shall use their commercial best efforts to
obtain as promptly as possible the consents described in Section 8(i) hereof.

                                       12
<PAGE>
     (g) Asset  Ownership.  Makers have good and  indefeasible  title,  free and
clear of all Liens,  except for the Liens created by the Loan Documents,  to all
of its properties and assets,  including,  without  limitation,  all Collateral,
and,  except as otherwise  disclosed to Lender in writing,  no Person other than
Makers  have  any  right,  title  or  interest  in or to any of the  Collateral,
including,  without  limitation,  Telspace or Mcash.  All  Collateral is in good
operating condition and repair.

     (h) Litigation.  Except as previously disclosed in the Unified SEC Filings,
there are no  claims,  actions,  suits or  proceedings  pending,  or, to Makers'
knowledge,  threatened against any Maker, affecting the Collateral or that could
prevent,  materially  delay or otherwise  negatively  impact Makers'  ability to
perform  their  respective  obligations  under  this  Note  and the  other  Loan
Documents, whether at law or in equity, or before any governmental authority.

     (i) Taxes.  Makers have timely paid to the appropriate  taxing  authorities
all Taxes due or claimed to be due from it by any governmental authority.  There
are no Liens for Taxes (other than for Taxes not yet due and  payable)  upon any
of the  properties  or assets of  Makers,  including,  without  limitation,  the
Collateral.  There is no  examination  or  proceeding  pending  or,  to  Makers'
knowledge,  threatened  by any taxing  authority  relating to the  assessment or
collection  of, or any  delinquencies  in filing  related to, any Taxes from any
Maker, nor is there any basis for any such assessment or collection.

     (j) Compliance with Laws. Makers are in compliance with all Laws applicable
to their respective properties,  assets, operations,  business and finances, and
hold all licenses,  certificates,  permits,  authorizations  and rights from all
appropriate governmental authorities for the conduct of their business. All such
licenses, certificates, permits, authorizations and rights are in full force and
effect, and no proceeding is pending, or, to the knowledge of Makers, threatened
against any Maker wherein the remedy sought is the revocation or limiting of any
such license, certificate, permit, authorization or right, and there is no basis
or grounds for any such revocation or limitation.

     (k) No Material  Adverse Change.  There has been no material adverse change
with respect to any Maker or the Collateral which would be inconsistent with any
financial or other  information  provided to Lender in connection with the Loan,
nor, to Makers knowledge,  is any such material adverse change  threatened,  nor
has there been any damage, destruction or loss which to any property or asset of
any Maker which could result in any such  material  adverse  change.  To Makers'
knowledge,  no event has occurred  that has or would,  with the passage of time,
reasonably be expected to cause any such material adverse change.

     (l)  Purpose  of  Loan.  Makers  have  requested  the  Loan  for  business,
commercial,  investment or other similar purposes, specifically for the purchase
of prepaid debit card stock and SIM card stock;  provided,  however, that Makers
may use a total of $75,000 of the Loan proceeds for working capital  purposes or
the repayment of certain Indebtedness, in the reasonable discretion of Makers.

     (m) Full Disclosure.  No representation or warranty  contained in this Note
or the other Loan  Documents,  nor any  written  statement,  exhibit or schedule
furnished in connection with the  transactions  contemplated  hereby or thereby,
contains  any untrue  statement of a material  fact or omits any  material  fact
necessary  to  make  the  statements   contained   therein,   in  light  of  the
circumstances under which it was made, not misleading.

                                       13
<PAGE>
     8.  Covenants.  Until the Loan and all other  amounts owing under this Note
and other Loan Documents are paid in full, Makers each hereby covenant and agree
as follows:

     (a) Use of  Proceeds.  Makers  shall  use the  Loan  proceeds  only for the
purposes set forth in Section 7(l) hereof.

     (b)  Existence  and  Business  Continuity.  Unified  shall at all times (i)
maintain its existence in the state in which it is  organized;  and (ii) obtain,
preserve and maintain in good  standing all rights,  privileges  and  franchises
necessary  or  desirable  for the conduct of  Unified's  business  as  presently
conducted and proposed to be conducted. In the event Co-Maker is not voluntarily
dissolved prior to the payment of all amounts owing on the Loan,  Co-Maker shall
also comply with the  foregoing  covenants  set forth in this Section  8(b).  If
Co-Maker is voluntarily dissolved, Co-Maker or Unified shall promptly thereafter
provide evidence thereof reasonably satisfactory to Note Holder.

     (c) Compliance  with Laws.  Makers shall comply with all Laws applicable to
their  respective  properties,   assets,  operations,   business  and  finances,
including all building  restrictions  and recorded  covenants  and  restrictions
affecting  the  Collateral.  Makers shall  continue to hold and maintain in full
force and effect all licenses, certificates,  permits, authorizations and rights
from all  appropriate  governmental  authorities  and other Persons,  including,
without  limitation,  Telbill,  Telspace  and  Mcash,  for the  conduct of their
business.

     (d) Insurance.  Unified shall use its commercial  best efforts to obtain as
promptly  as  possible  the  following  policies of  insurance  (the  "INSURANCE
POLICIES"):

     (i)  Products or services financial injury (errors and omissions);

     (ii) Intellectual property infringement injury (cyber liability);

     (iii) Privacy and information security injury; and

     (iv) Such other  insurance  as Note Holder in its  reasonable  judgment may
          require.

     Limits  of  liability  for the  Insurance  Policies  shall be not less than
$1,000,000 general aggregate. All Insurance Policies must be issued by companies
approved  by Note  Holder  and  otherwise  be  acceptable  to Note  Holder as to
amounts,  forms,  risk coverages and deductibles.  All Insurance  Policies shall
contain a waiver of subrogation  endorsement in favor of Lender. Lender shall be
added to all such Insurance Policies as an additional insured (without condition
or cost to  Lender),  and  contain  a thirty  (30) day  notice  of  cancellation
provision requiring notice to Lender.

     Notwithstanding  the provisions of Section 10 hereof,  it shall be an Event
of Default if Makers shall suffer any catastrophic loss or other material damage
to the  Collateral  that  would  have  been  covered  under  one or  more of the
Insurance  Policies but for the fact that  Unified did not obtain the  Insurance
Policies prior to such loss.

     (e) Costs and  Expenses.  Makers  shall pay when due all costs and expenses
required by applicable Law, this Note and the other Loan Documents.

     (f)  Maintenance  of  Assets.  Makers  shall  at  all  times  maintain  the
Collateral in good condition and repair, ordinary wear and tear excepted. Except
with Note Holder's prior written consent, Makers shall not:

                                       14
<PAGE>
     (i) Sell, assign,  lease,  transfer or otherwise dispose of any part of any
Maker's business or assets, except in the ordinary course of business;

     (ii) Sell, assign,  lease,  transfer or otherwise dispose of any assets for
less than fair market value, or enter into an agreement to do so; or

     (iii) Enter into any sale and leaseback agreement covering any of its fixed
assets.

     (g) Access to Books and Records.  Makers shall maintain  adequate books and
records and allow Note Holder and its  representatives  reasonable access to its
personnel,  books and records,  and allow Note Holder,  at Makers'  expense,  to
inspect,  audit and examine such records and make extracts  therefrom and copies
thereof.

     (h) Notices.  Makers shall deliver to Note Holder, in reasonable detail and
in form reasonably  acceptable to Note Holder, as soon as possible,  and, in any
event,  within  five (5)  Business  Days  after  any  Maker  receives  notice or
knowledge  thereof  or learns  facts  which  would lead a  reasonable  Person to
undertake  diligent inquiry with respect thereto, a report or statement executed
by a senior officer of Unified with respect to:

     (i) The  occurrence  of an Event of  Default or any event  which,  upon the
giving of notice or lapse of time or both,  may become an Event of Default,  and
any action taken or contemplated by any Maker with respect thereto; and

     (ii) The  existence  or  change  in status  of any  pending  or  threatened
litigation  with  any  third  party  or  administrative  proceedings  before  or
investigations by any government authority against or affecting any Maker or the
Collateral; and

     (i) Consents by Telspace and Mcash.  Makers shall use their commercial best
efforts to obtain as promptly as possible (i) the written consent of Telspace to
the Telspace  Assignment and Assumption  Agreement in substantially the form set
forth as ANNEX A  thereto;  and (ii) the  written  consent of Mcash to the Mcash
Assignment and Assumption Agreement in substantially the form set forth as ANNEX
A thereto.

     (i) No Substantial Change in Unified.  Without the prior written consent of
Note Holder,  Unified shall not (i) make any change in the present  executive or
senior management personnel of Unified;  (ii) cause, permit or suffer any change
in the capital  ownership of Unified;  (iii)  engage in any business  activities
substantially  different than those presently  conducted by Unified;  (iv) enter
into any  consolidation,  merger or other  combination or change of control,  or
become a partner in a  partnership,  a member in a joint  venture or member in a
limited liability  company;  (v) change its fiscal year; or (vi) or liquidate or
dissolve Unified's business.

     9. Negative  Covenants.  As long as any amounts owing under the Note or the
other Loan Documents remain outstanding, unless Note Holder shall have otherwise
given prior written  consent,  each Maker shall not, and shall not permit any of
its subsidiaries or Affiliates to, directly or indirectly:

     (a) Enter into,  create,  incur,  assume,  guarantee or suffer to exist any
Indebtedness  for borrowed money of any kind,  including,  but not limited to, a
guarantee,  on or with  respect  to any of its  property  or assets now owned or
hereafter  acquired or any interest therein or any income or profits  therefrom,
except for  accounts  payable,  trade  payables,  Taxes and  similar  short-term

                                       15
<PAGE>
liabilities incurred in the ordinary course of business; provided, however, that
in the event  Lender or an affiliate  thereof  does not provide  financing of an
inventory facility as contemplated by the parties,  Note Holder shall waive this
provision to the extent  necessary to enable Makers to obtain debt  financing of
up to  $4,100,000  for the same  purposes  on terms  and  conditions  reasonably
acceptable to Note Holder;

     (b) Except as otherwise  contemplated  herein,  enter into, create,  incur,
assume or suffer to exist any Liens of any kind,  on or with  respect  to any of
its property or assets now owned or hereafter  acquired or any interest  therein
or any income or profits therefrom;

     (c)  Amend  its  charter  documents,  including,  without  limitation,  its
certificate  of  incorporation  and bylaws,  in any manner that  materially  and
adversely affects any rights of Note Holder;

     (d) Repay,  repurchase or offer to repay,  repurchase or otherwise  acquire
any shares of its Common Stock or Common Stock  equivalents other than as to the
Conversion Shares to the extent permitted or required under the Loan Documents;

     (e) Redeem, defease,  repurchase, repay or make any payments in respect of,
by the payment of cash or cash equivalents (in whole or in part,  whether by way
of open market purchases, tender offers, private transactions or otherwise), all
or any portion of any  Indebtedness  (other  than this Note),  whether by way of
payment in respect of  principal  of (or  premium,  if any) or interest on, such
Indebtedness;

     (f)  Declare or make any  dividend or other  distribution  of its assets or
rights to  acquire  its  assets to  holders of shares of any class of its equity
securities,  by way  of  return  of  capital  or  otherwise  including,  without
limitation,  any  distribution of cash, stock or other  securities,  property or
options  by  way  of  a   dividend,   spin  off,   reclassification,   corporate
rearrangement, scheme of arrangement or other similar transaction;

     (g) Enter into any  transaction  with any of its  Affiliates,  unless  such
transaction is made on an arm's-length basis and expressly approved by its Board
of Directors (which shall include disinterested directors and a majority of whom
shall approve the transaction, even if less than a quorum otherwise required for
board approval); or

     (h) Enter into any agreement with respect to any of the foregoing.

     10. Default.  Each of the following shall  constitute an default under this
Note (each an "EVENT OF DEFAULT"):

     (a) Any default in the payment of  principal  amount of or interest on this
Note or liquidated  damages and other amounts owing to Note Holder on this Note,
as and when the same shall become due and payable  (whether on a Conversion Date
or the Maturity Date or by acceleration or otherwise);

     (b) Any Maker fails to observe or perform any other  covenant or  agreement
contained  in this Note  (other than a breach by a Maker of its  obligations  to
deliver shares of Common Stock to Note Holder upon  conversion,  which breach is
addressed in Section  10(i) below)  which  failure is not cured,  if possible to
cure,  within the earlier to occur of (i) seven (7) Trading Days after notice of
such failure sent by Note Holder to such Maker;  and (ii) seven (7) Trading Days
after such Maker has become or should have become aware of such failure;

                                       16
<PAGE>
     (c) A default  or event of  default  (subject  to any grace or cure  period
provided in the applicable agreement, document or instrument) shall occur on the
part of any  Maker  under  (i) any of the  Loan  Documents;  or (ii)  any  other
agreement,  lease, document or instrument to which a Maker is obligated (and not
covered by Section 10(f) below),  which default or event of default, in the case
of Section  10(c)(ii),  could reasonably be expected to result in liabilities to
such  Maker  of  $50,000  individually  or in the  aggregate,  adversely  impact
material intellectual property rights or other rights of such Maker or otherwise
have a material  adverse  effect on such  Maker's  assets,  business,  financial
condition or results of operations;

     (d) Any  representation or warranty made by a Maker in this Note, any other
Loan Documents,  any written  statement  pursuant hereto or thereto or any other
report,  financial  statement  or  certificate  made or delivered to Note Holder
shall be untrue or incorrect in any material respect as of the date when made or
deemed made;

     (e) Any Maker shall be subject to a Bankruptcy Event;

     (f) Any Maker shall default on any of its  obligations  under any mortgage,
credit agreement or other facility, indenture agreement,  factoring agreement or
other  instrument  under  which  there may be issued,  or by which  there may be
secured or evidenced, any Indebtedness for borrowed money or money due under any
long term  leasing or  factoring  arrangement  that (i)  involves an  obligation
greater than $50,000 individually or in the aggregate, whether such indebtedness
now exists or shall hereafter be created;  and (ii) results in such Indebtedness
becoming or being  declared due and payable  prior to the date on which it would
otherwise become due and payable;

     (g) Any  Maker  shall be a party to any  Fundamental  Transaction  or shall
agree to sell or  dispose  of all or in excess of  thirty  percent  (30%) of its
assets in one transaction or a series of related transactions;

     (h) Unified does not meet the current public information requirements under
Rule 144  promulgated by the SEC pursuant to the Securities Act (and the same is
not cured by the fifth (5th) Trading Day after the occurrence of such event);

     (i)  Unified  shall  fail for any reason to  deliver  certificates  to Note
Holder prior to the seventh (7th)  Trading Day after a Conversion  Date pursuant
to Section  5(c),  or Unified  shall  provide at any time notice to Note Holder,
including by way of public  announcement,  of  Unified's  intention to not honor
requests for conversions of this Note in accordance with the terms hereof;

     (j) Any monetary  judgment,  writ or similar final process shall be entered
or filed against a Maker, any subsidiary or any of their respective  property or
other assets for more than  $50,000,  and such  judgment,  writ or similar final
process shall remain unvacated, unbonded or unstayed for a period of ninety (90)
days thereafter;

     (k) Any dissolution,  liquidation or winding up by Unified of a substantial
portion of its business or a cessation of operations by Unified;

     (l) An event resulting in the Common Stock no longer being listed or quoted
on a trading market,  or notification from a trading market or any of such other
markets that Unified is not in compliance with the conditions for such continued
listing or  quotation  and such  non-compliance  continues  for twenty (20) days
following such notification;

                                       17
<PAGE>
     (m) A SEC or  judicial  stop  trade  order  or  suspension  from  Unified's
principal trading market for five (5) or more Trading Days;

     (n) Any material  provision of any Loan Document  shall at any time for any
reason (other than pursuant to the express terms  thereof) cease to be valid and
binding on or  enforceable  against a Maker,  or the validity or  enforceability
thereof shall be contested by a Maker,  or a proceeding  shall be commenced by a
Maker or any  governmental  authority having  jurisdiction  over a Maker or Note
Holder seeking to establish the  invalidity or  unenforceability  thereof,  or a
Maker shall deny in writing that it has any liability or obligation purported to
be created under any Loan Document;

     (o) The failure by a Maker to maintain any material  intellectual  property
rights,  personal,  real property,  equipment,  leases or other assets which are
necessary to conduct its business (whether now or in the future); or

     (p) The restatement after the date hereof of any financial statements filed
by Unified  with the SEC for any date or period  from two (2) years prior to the
date hereof and until this Note is no longer outstanding,  if the result of such
restatement would, by comparison to the unrestated  financial  statements,  have
constituted  a material  adverse  effect  upon the  business  or  operations  of
Unified.  For the avoidance of doubt, any restatement  related to new accounting
pronouncements shall not constitute a default under this Section 10(p).

     No notice  from Note  Holder  to a Maker of an Event of  Default  (or of an
event  which with  notice or  passage  of time or both would  become an Event of
Default) shall operate to extend any cure period otherwise  applicable  thereto.
Promptly  after Makers shall obtain  knowledge of the occurrence of any Event of
Default  or of any event  which with the notice or passage of time or both would
become  an  Event of  Default,  Makers  shall  deliver  to Note  Holder a notice
specifying  that such notice is a "NOTICE OF Default" and describing  such event
in  reasonable  detail,  and in such Notice of Default or as soon  thereafter as
practicable,  a  description  of the action Makers have taken or propose to take
with respect thereto.

     11. Remedies upon Default. Upon the occurrence of an Event of Default, Note
Holder, in its sole discretion,  may take any of the following actions:  (i) the
entire balance outstanding hereunder, and all other obligations and indebtedness
of  Makers  to  Note  Holder  (however   acquired  or  evidenced)  shall  become
immediately due and payable, and any obligation of Note Holder to permit further
borrowing by Makers  (whether  under this Note or otherwise)  shall  immediately
cease and terminate; (ii) to the extent permitted by applicable Law, the rate of
interest  charged  on any  amounts  owing  hereunder  or under  the  other  Loan
Documents  shall be increased to the lesser of (A) eighteen  percent (18.0%) per
annum, or (B) the maximum rate permitted by applicable Law (the "DEFAULT RATE");
(iii) without demand or notice to Makers, set off and charge against any deposit
accounts  of Makers or any other  Obligor  (as well as any  money,  instruments,
securities, documents, chattel paper, credits, claims, demands, income and other
property,  rights and  interests of Makers or any other  Obligor),  which at any
time  shall  come into the  possession,  custody  or under the  control  of Note
Holder, any and all amounts due hereunder or under the other Loan Documents; and
(iv) any and all rights and  remedies  available  to Note Holder under the other
Loan Documents, at law or in equity.

     12.  Post-Maturity  Rate.  The rate of  interest  charged on any amounts of
principal,  accrued and unpaid  interest or other costs owing hereunder or under
the other Loan Documents,  whether due as a result of maturity,  acceleration of
maturity or otherwise,  shall  automatically  be the Default  Rate,  which shall

                                       18
<PAGE>
begin to accrue from the date any such amounts shall have become due until fully
discharged.

     13.  Expenses.  Makers shall pay all of the costs and  expenses  reasonably
incurred by Note Holder in connection  with  collecting or attempting to collect
any sums due under  this Note or the other  Loan  Documents,  or  enforcing  any
provision of this Note or any of the other Loan  Documents,  including,  but not
limited  to,  reasonable   attorneys'  fees  and  disbursements  and  applicable
statutory  costs,  whether  incurred  out of court or in  litigation,  including
pre-trial, appellate and bankruptcy proceedings.

     14.  Non-Waiver.  The failure at any time by Note Holder to exercise any of
its  options or any other  rights  hereunder  or under the other Loan  Documents
shall not constitute a waiver thereof,  nor shall it be a bar to the exercise of
any of Note Holder's  options or rights at a later date.  The acceptance by Note
Holder of any partial payment shall not constitute a waiver of any default or of
any of Note Holder's  rights under this Note or under the other Loan  Documents.
No waiver of any of its rights hereunder or under the other Loan Documents,  and
no  modification  or  amendment to this Note,  shall be deemed to have  occurred
unless the same shall be in writing,  duly signed on behalf of Note Holder.  Any
waiver by Note  Holder of any of its  rights  hereunder  or under the other Loan
Documents shall apply only with respect to the specific instance  involved,  and
in shall in no way impair the rights of Note Holder or  obligations of Makers or
any other Obligor to Note Holder in any other respect at any other time.

     15. Obligations Joint and Several; Remedies Cumulative.  This Note shall be
the joint and several obligations of Makers and all other Obligors, and shall be
binding  upon  each of them  and  their  successors,  beneficiaries,  heirs  and
permitted  assigns.  All rights and remedies of Note Holder shall be  cumulative
and  concurrent,  and shall be in addition to every other right or remedy now or
available to Note Holder hereunder,  under any other Loan Document, at law or in
equity.  Such remedies may be pursued singly,  successively or together  against
Makers or any Obligor or other security at the option of Lender.

     16. Waiver; No Release. Presentment,  demand, notice of dishonor, notice of
protest  and  protest  are hereby  waived by Makers and all other  Obligors.  No
release of any Obligor  liable for the  indebtedness  evidenced  hereby,  and no
release of any security  for the  indebtedness  evidenced  by this Note,  or any
portion  thereof,  and no extension,  alteration,  amendment,  subordination  or
waiver of any provision of this Note or of any other of the Loan  Documents made
by  agreement  between  Note Holder and any Obligor  shall  release,  discharge,
modify,  change or affect the  liability  of Makers or any other  Obligor now or
hereafter  liable  under  this Note or under the other  Loan  Documents.  Makers
hereby  expressly  waive  any  right  to make a  claim  for or  relating  to the
marshaling of assets.

     17.  Governing Law;  Venue. To the extent not preempted by federal Law, the
provisions of this Note shall be governed by and  construed in  accordance  with
the Laws of the State of Texas,  without regard principles of conflicts of laws.
All claims, counterclaims,  appeals or other litigation arising out of this Note
or the  indebtedness  evidenced  hereby shall be brought in the state or federal
courts located in Bexar County,  Texas and having  subject  matter  jurisdiction
over the matter in controversy, and Makers hereby agree to such jurisdiction and
waive any defense of inconvenient  forum.  Makers further agree that process may
be served upon them by certified or registered  mail,  postage  prepaid,  return

                                       19
<PAGE>
receipt  requested,  directed to Makers at their address set forth  herein,  and
Makers  hereby  waive any defense of  insufficiency  of service  with respect to
process so served.

     18. Waiver of Jury Trial.  MAKERS  COVENANT AND AGREE THAT,  BECAUSE OF THE
COMPLEXITIES OF COMMERCIAL  TRANSACTIONS AND THE NEED FOR EXPEDITIOUS RESOLUTION
OF DISPUTES, ALL CLAIMS, COUNTERCLAIMS,  APPEALS OR OTHER LITIGATION ARISING OUT
OF THIS NOTE OR ANY OF THE OTHER LOAN DOCUMENTS, OR THE SUBJECT MATTER HEREOF OR
THEREOF, SHALL BE BEFORE A COURT SITTING WITHOUT A JURY, AND MAKERS HEREBY WAIVE
TRIAL BY JURY IN ALL SUCH INSTANCES.

     19. Balloon Payment.  This Loan is payable in full on the Maturity Date. At
maturity, Makers must repay the entire outstanding principal balance of the Loan
and any unpaid interest thereon and other amounts owing in connection therewith.
Note Holder is under no  obligation  to  refinance  the Loan or convert the Loan
into Common  Stock.  Makers may,  therefore,  be required to make payment out of
other assets, or Makers will have to obtain financing from another source.

     20. Assignment and Participation.  Makers hereby acknowledge and agree that
Note  Holder  may,  at any time and from  time to time,  in Note  Holder's  sole
discretion  and  without  notice  to or  consent  by  Makers,  sell,  assign  or
participate  interests in the Loan or credit facility  evidenced by this Note or
other  Loan  Documents,   and  in  connection  therewith  may  disclose  to  any
prospective  purchaser,  assignee or participant any and all financial and other
information about Makers,  any other Obligor or any property securing this Note,
in the possession of Note Holder.

     21. Entire Agreement;  Assignment.  This Note, together with the other Loan
Documents,  represents the entire agreement and understanding between Makers and
Note Holder,  and supersedes and replaces any and all prior  agreements or other
understandings of Makers and Note Holder,  whether written or oral, with respect
to the  subject  matter  hereof.  None of the  rights or  obligations  of Makers
hereunder may be assigned, except with the prior written consent of Note Holder,
which consent may be given or withheld in Note Holder's sole discretion.

     22. Invalidity. In the event any one or more of the provisions contained in
this Note or any of the other Loan Documents  shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Note or such other
Loan Documents, but this Note and the other Loan Documents shall be construed as
if such invalid,  illegal or  unenforceable  provision had never been  contained
herein or therein.

     23. Relationship of Parties. Note Holder shall in no event be construed for
any purpose to be a partner,  joint  venturer or associate of Makers,  or of any
lessee,  operator,  concessionaire  or  licensee  of Makers,  in the  conduct of
Makers' business.

     24. Purpose of Loan.  Makers hereby certify that the Loan is being obtained
for business or commercial  purposes,  and that the proceeds thereof will not be
used primarily for personal, family, household or agricultural purposes.

     25. Notices. Any notice, demand, request or other communication that Makers
or Lender may desire or may be  required  to give to the other  party under this
Note or the Loan Documents shall be given in writing, at the addresses set forth

                                       20
<PAGE>
below,  by any of the following  means:  (i) personal  service;  (ii)  overnight
courier;  or (iii) registered or certified United States mail,  postage prepaid,
return receipt requested.

     If to Lender:     Gettysburg Holdings, LLC
                       8522 Broadway Street, Suite 209
                       San Antonio, Texas 78217
                       Attn: Paul Posner

     If to Makers:     Unified Signal, Inc.
                       5400 Carillon Point
                       Building 5000
                       4th Floor
                       Kirkland, Washington 98033
                       Attn: Paris Holt

                       Telbill Holdings, LLC
                       5400 Carillon Point
                       Building 5000
                       4th Floor
                       Kirkland, Washington 98033
                       Attn: Paris Holt

                            NOTICE OF FINAL AGREEMENT

THIS WRITTEN  PROMISSORY  NOTE  REPRESENTS THE FINAL  AGREEMENT AMONG MAKERS AND
NOTE HOLDER,  AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,  CONTEMPORANEOUS
OR  SUBSEQUENT  ORAL  AGREEMENTS  OF THE PARTIES.  THERE ARE NO  UNWRITTEN  ORAL
AGREEMENTS BETWEEN MAKERS AND NOTE HOLDER.

                            [SIGNATURE PAGE FOLLOWS.]

                                       21
<PAGE>
MAKERS:

UNIFIED SIGNAL, INC., a Nevada corporation

By:
   -------------------------------------------------

Name:
     -----------------------------------------------

Title:
      ----------------------------------------------

TELBILL HOLDINGS, LLC, a Washington limited liability company

By:
   -------------------------------------------------

Name:
     -----------------------------------------------

Title:
      ----------------------------------------------

                                       22
<PAGE>
                                     ANNEX A

                              NOTICE OF CONVERSION

     The  undersigned  hereby elects to convert  principal  and/or other amounts
under that certain Convertible  Promissory Note (the "NOTE") due July 8, 2016 by
UNIFIED SIGNAL,  INC., a Nevada corporation  ("UNIFIED"),  and TELBILL HOLDINGS,
LLC, a Washington  limited  liability  company  ("TELBILL,"  and  together  with
Unified,  "MAKERS"),  and payable to the order of  GETTYSBURG  HOLDINGS,  LLC, a
Delaware limited  liability  company  (together with its successors and assigns,
"NOTE HOLDER"),  into shares of common stock, par value $0.001,  of Unified (the
"COMMON  STOCK")  according  to the  conditions  hereof,  as of the date written
below.  If shares  of  Common  Stock are to be issued in the name of a person or
entity other than Note Holder,  Note Holder will pay all transfer  Taxes payable
with respect thereto and is delivering  herewith such certificates and opinions,
if any, required by the Note and related loan documents.  No fee will be charged
to Note Holder for any conversion, except for such transfer Taxes, if any.

     By the delivery of this Notice of  Conversion  Note Holder  represents  and
warrants to Unified that its ownership of the Common Stock does not give rise to
the reporting requirements under Section 13(d) of the Securities Exchange Act of
1934, as amended.

     Note Holder  agrees to comply  with the  prospectus  delivery  requirements
under the  applicable  securities  Laws in  connection  with any transfer of the
aforesaid shares of Common Stock.

Conversion Calculations:

     Date to Effect Conversion:
                                                 -------------------------------
     Principal Amount of Note to be Converted:   $
                                                 -------------------------------
     Accrued Interest to be Converted:           $
                                                 -------------------------------
     Other Amounts to be Converted:              $
                                                 -------------------------------
     TOTAL AMOUNT TO BE CONVERTED:               $
                                                 -------------------------------
     Number of Shares of Common Stock to be Issued:
                                                   -----------------------------

Note Holder Signature:

     By:
        ------------------------------------------------
     Name:
          ----------------------------------------------
     Title:
           ---------------------------------------------

Address for Delivery of Certificates:

           ---------------------------------------------

           ---------------------------------------------

           ---------------------------------------------

Or:
     DWAC Instructions:
                       ---------------------------------
     Broker No.:
                       ---------------------------------
     Account No.:
                       ---------------------------------

                                       23

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