COPY OF ORIGINAL
AS ASSIGNED TO ▇▇▇▇▇▇ ▇▇▇▇▇▇
PROMISSORY NOTE
&
SECURITY AGREEEMENT
Dated as of January 25, 2001
FOR VALUE RECEIVED, the undersigned, Fusion Telecommunications
International, Inc., a Delaware corporation, having its principal place of
business at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the
"Borrower"), hereby unconditionally promises to pay to the order of ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, as Trustee (the "Lender"), with an office located c/o ▇▇▇▇▇,
▇▇▇▇▇ & ▇▇▇▇▇▇▇, P.A., ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇, the principal sum of ONE MILLION DOLLARS ($1,000,000.00), in lawful money
of the United States with interest thereon to be computed from the date of this
promissory note and security agreement (the "Note") at the interest rate shown
below, in accordance with the payment schedule set forth herein. This Note is
being executed and delivered outside the State of Florida.
1. PAYMENT TERMS
a) Principal and interest payments under this Note shall be
paid to Lender in accordance with the payment schedule
set forth on Schedule I attached hereto.
b) If any payment becomes due and payable on a day other
than a Business Day, the due date thereof shall be
extended to the next succeeding Business Day, and
interest shall be payable during the extension at the
applicable rate. For purposes of this Note, "Business
Day" shall mean any day that is not a Saturday, Sunday or
other day on which the commercial banking institutions in
the State of New York are authorized or obligated by law
or executive order to be closed.
2. INTEREST RATE
a) The interest rate for this Note shall be an interest rate
equal to thirteen percent (13.00%) per annum.
b) Interest and any fees hereunder shall be computed on the
basis of a year comprised of 365 days.
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c) Borrower hereby agrees that upon occurrence and during
continuance of an event of default, Lender shall be
entitled to receive and Borrower shall pay interest on
the entire unpaid principal sum at a rate equal or lesser
of (i) eighteen percent (18%) per annum, or (ii) the
maximum interest rate which Borrower may by law pay (the
"Default Rate"). The Default Rate shall be computed from
the occurrence of the event of default until the earlier
of the date upon which the event of default is cured or
the date upon which the defaulted is paid in full.
Interest calculated at the Default Rate shall be added to
the principal due under the Note and shall be deemed
secured by collateral. This paragraph shall not be
construed as an agreement or privilege to extend the date
of any payment, nor as a waiver of any other right or
remedy accruing to Lender by reason of the occurrence of
any event of default.
d) Notwithstanding anything contained herein to the
contrary, in no event shall any interest rate provided
herein exceed the maximum rate of interest allowed by the
applicable law, as amended from time to time. Lender does
not intend to charge any amount of interest or other fees
or charges in the nature of interest that exceeds the
maximum amount allowed by applicable law. If any payment
of interest or in the nature of interest would cause the
forgoing interest rate limitation to exceed, then such
excess payment shall be credited as a payment of
principal, unless Borrower notifies Lender in writing
that the excess payment must be returned to Borrower,
together with interest as the rate specified under New
York law.
3. PREPAYMENTS
a) Borrower shall be entitled to prepay this Note in whole
or in part, at any time, without premium or penalty.
b) Any prepayment of this Note (whether optional or
required, but not including any payment after default or
acceleration) shall be applied first to principal and
then to interest and lawful charges, unless otherwise
specified by Borrower. In the event of a prepayment after
default or acceleration, any prepayment of this Note
shall be applied first to interest accrued on the
principal amount prepaid and other lawful charges, and
then to principal. Borrower, shall, at the time of making
payments of this Note, specify to Lender the amount of
this Note to be prepaid.
4. SECURITY
a) This Note is secured by Borrower's accounts receivable
set forth on Schedule A attached hereto ( the "Accounts
Receivable") and
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Borrower hereby grants Lender a security interest in all
of such Accounts Receivable.
b) In order to perfect a security interest in the Accounts
Receivable, Borrower agrees to execute and deliver to the
Lender any and all documents which are, in the opinion of
Lender or its counsel, necessary so as to perfect the
said security interests including, but not limited to,
appropriate UCC-1 financing statements to be filed with
the Secretary of State of New York and with the
appropriate filing officers in all such jurisdictions
where any of the Accounts Receivable may be located.
Borrower does hereby appoint Lender as its
attorney-in-fact, with full power of substitution, to
prepare, execute and file UCC financing statements ,
amendments, releases, continuations, assignments and
other perfection instruments as Lender deems reasonably
necessary or appropriate to protect Lender's interest in
the products. Borrower hereby authorizes the Lender to
execute and file at any time any financing statements,
continuation statements, or amendments thereto, without
signatures of Borrower thereon, which the Lender deems
reasonably necessary to protect, perfect, continue or
maintain the security interests and liens granted to the
Lender.
5. DEFAULT
a) If an event of default as defined below, occurs and such
event of default continues after the expiration of any
applicable notice and grace periods, then the whole
unpaid principal sum due under this Note, all interest,
default interest, late charges and all other monies
agreed or provided to be paid by Borrower under this Note
shall without notice become immediately due and payable.
b) Unless payments are made in the amount and as required
hereunder, remittances in payments of full or any part of
the payments due under this Note shall not, regardless of
any receipt or credit issued therefore, constitute
payment until the required amount is actually received by
Lender in funds immediately available as specified herein
and shall be made and accepted subject to the condition
that any check or draft may be handled for collection in
accordance with the practice of the collecting bank or
banks. Acceptance by Lender or any payment in an amount
then due shall be deemed an acceptance on account only
and the failure to pay the entire amount by the tenth
(10th) day after the payment due date shall be an event
of default.
c) It shall be an event of default under this Note if: (i)
Borrower fails to make payment of principal, interest, or
other amount as it comes due on any indebtedness owed
Lender hereunder, or fails to make any
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other payment to Lender as contemplated hereunder either
by the terms hereof or otherwise; (ii) any liquidation or
dissolution of Borrower, suspension of the business of
the Borrower, or filing or commencement by Borrower of a
voluntary petition, case, proceeding, or other action
seeking reorganization, arrangement, readjustment of its
debts; or commencement or involuntary petition case,
proceeding or other action against Borrower seeking
reorganization, arrangement or readjustment of its debts,
which is not vacated, discarded, stayed, bonded or
dismissed within sixty (60) days of its commencement, or
the entry of an order for relief under any existing or
future law of any jurisdiction, domestic or foreign,
state or federal, relating to bankruptcy, insolvency,
reorganization or relief of debtors, or any other action
of Borrower indicating its consent to, approval of or
acquiescence in, any such petition, case, proceeding, or
other action seeking to have an order for relief entered
with respect to it or its debts; the application by
Borrower for, or the appointment, by consent or
acquiescence of, a receiver, trustee, custodian or other
similar official for Borrower or for all or substantial
part of its property; the making by Borrower of an
assignment for the benefit of creditors; or the inability
of Borrower or the admission by Borrower in writing of
its inability to pay its debts as they mature; (iii) any
order is entered in any proceedings against Borrower
decreeing the dissolution or split-up of Borrower, and
such order remains in effect for more than sixty (60)
days; (iv) any act or omission (formal or informal) of
Borrower or its offices, directors or shareholders,
leading to, or resulting in, the termination,
invalidation (partial or total) , revocation, suspension,
interruption, or unenforceability or its existence, or
transfer or disposition (whether by sale, lease or
otherwise) to any person of all or a substantial par of
its property;
Then (i) upon the occurrence of any event of default
described in the foregoing subsection (c), the unpaid
principal amount of and accrued interest on the Note
becomes immediately due and payable, without presentment,
demand, protest, or other requirement of any kind, all of
which are expressly waived by Borrower; and (ii) upon the
occurrence and during the continuance of any other event
of default Lender may take one or more of the following
actions: )a) declare all or any portion of the Note to
be, and the same shall forthwith become, immediately due
and payable, without presentment, demand, protest, or
other requirement of any kind, all of which are expressly
waived by Borrower. Lender may immediately proceed to do
all other things provided by law to enforce the rights of
Lender and to collect all amounts owing to Lender by
Borrower. Without limiting foregoing in any way, upon any
event of default, Lender shall be entitled to the
appointment of a receiver to take charge of the
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collateral and Borrower hereby waives any objection to
the appointment of a receiver. No right, power, or remedy
conferred upon Lender by this Note shall be exclusive of
any other right, power, or remedy referred to therein or
now or hereafter available at law or in equity.
6. TRANSFER
Lender may assign or transfer this Note and upon such
assignment or transfer, Borrower hereby waives notice or
any such assignment or transfer and Lender may deliver,
pledge or assign its interest in the collateral to the
transferee/assignee who shall thereupon become vested
with all the rights herein or under applicable law given
to Lender with respect thereto, and Lender shall
therefore be relieved and fully discharged from any
liability or responsibility under this Note.
7. MISCELLANEOUS
a) Borrower agrees to pay or reimburse the Lender for all of
its reasonable costs and expenses incurred in connection
with administration, supervision, collection, or
enforcement, or preservation of any rights under this
Note including without limitation, the reasonable fees
and disbursements of counsel for the Lender, including
attorneys' fees out of court, in trial, on appeal, in
bankruptcy proceedings, or otherwise.
b) All notices, demands, and other communications required
or permitted in connection with this Note shall be deemed
to have been given: (i) upon delivery, if delivered in
person or by facsimile transmission with receipt
acknowledged by the recipient thereof, (ii) one (1)
business day after having been deposited for overnight
delivery with any reputable overnight courier service, or
(iii) three (3) business days after having been deposited
in any post office or mail depository regularly
maintained by the U.S. Postal Service and sent by
registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
To Borrower: Fusion Telecommunications
International, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
To Lender: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, as Trustee
c/o ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇, P.A.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
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c) This Note may not be modified, amended, waived, extended,
changed, discharged or terminated orally or by act or
failure to act on the part of the Borrower or Lender, but
only by a written amendment to this Note signed by both
parties.
d) The remedies of the Lender, as provided herein, or in
this Note are cumulative and concurrent and may be
pursued singularly, successively, or together, and may be
exercised as often as the occasion therefore shall arise.
e) This Note shall be governed by, and construed and
interpreted in accordance with, the laws of the State of
New York, excluding those laws relating to the resolution
of conflicts between the laws of different jurisdictions.
IN WITNESS WHEREOF, the undersigned has caused this Note to be executed by its
duly authorized representative as of the day and year first above written.
FUSION TELECOMMUNICATIONS INTERNATIONAL, INC.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
By: _________________________
Name:________________________
Title:_______________________
[ORIGINAL FORMERLY SIGNED BY ▇▇▇▇▇▇ ▇▇▇▇▇▇]
Acknowledged and agreed:
______________________________________
By: __________________________
Name:_______________________
Title:________________________
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SCHEDULE 1
▇▇▇▇▇▇ ▇▇▇▇▇, as Trustee
AMORTIZATION SCHDULE
Date: January 25, 2001
Financing Transaction: A/R of Fusion Telecommunications Int'l., Inc.
ORIGINAL AMOUNT: $1,000,000.00
PAYMENT: Monthly Interest
TERM: 6 Months
RATE: 13.00%
DEPOSIT(10%): $0.00
FINANCED(NET) PRINCIPAL: $1,000,000.00
MATURITY 16-Jul-01
Due at Maturity: P & I
PAYMENT PRINCIPAL
NO. DATE INTEREST REDUCTION PRINCIPAL
--- ---- -------- --------- ---------
25-Jan-01
1 15-Feb-01 $7,479.45 $0.00 $1,000,000.00
2 15-Mar-01 9,972.60 $0.00 $1,000,000.00
3 16-Apr-01 11,397.26 $0.00 $1,000,000.00
4 15-May-01 10,328.77 $0.00 $1,000,000.00
5 15-Jun-01 11,041.10 $0.00 $1,000,000.00
6 16-Jul-01 11,041.10 $1,000,000.00 0.00
---------- -------------
$61,260.27 $1,000,000.00
---------- -------------
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SCHEDULE A TO FINACNING STATEMENT
DEBTOR: Fusion Telecommunication International, Inc.
SECURED PARTY: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, as Trustee
The filing covers (i) all right, title and interest of the Debtor in
and to certain accounts receivable (the "Accounts Receivable) more fully
described in Schedule A attached to the promissory note and security agreement,
date January 25, 2001 as such promissory note and security agreement may be
amended (the "Note"), between the Debtor and the Secured Party, and all moneys
due, paid or received thereon and (ii) the proceeds of the foregoing. For a more
specific description of the Accounts Receivable, reference is made to Schedule A
attached to the Note and any amendments thereon, which is maintained by the
Debtor, and to other information available at the Debtor's office. Schedule A
describes each of the Accounts Receivable by the obligors thereon and the
principal amount owed to the Debtor as of November 30, 2000 and December 31,
2000, respectively. Any changes to the Accounts Receivable will be listed on an
amendment to Schedule A or otherwise made available. Schedule A and any
amendments thereto can be examined by interested parties, at no cost to them,
during normal business hours, at the Debtor's office.
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