Contract

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,OR ANY STATE SECURITIES LAWS. THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE,PLEDGED OR HYPOTHECATED UNTIL (i) A REGISTRATION STATEMENT UNDER THE SECURITIESACT OF 1933, AS AMENDED (THE “ACT”) SHALL HAVE BECOME EFFECTIVE WITH RESPECTTHERETO OR (ii) RECEIPT BY THE BORROWER OF AN OPINION OF COUNSEL REASONABLYSATISFACTORY TO THE BORROWER TO THE EFFECT THAT REGISTRATION UNDER THE ACT ISNOT REQUIRED IN CONNECTION WITH SUCH PROPOSED TRANSFER NOR IS IN VIOLATION OFANY APPLICABLE STATE SECURITIES LAWS. FORM OF SENIOR SECURED NOTE$________ February ___, 2005FOR VALUE RECEIVED, the undersigned, SuperStock, Inc., having an address of 7660Centurion Parkway, Jacksonville, Florida 32256 (the “Borrower”), promises to payto the order of _____________ (the “Lender”), at the office of Lender at_______________, or at such other place as Lender may from time to timedesignate in writing, without offset or counterclaim, the principal sum of_______________ ($________), in lawful money of the United States of America, onor before February ___, 2007 (the “Maturity Date”), together with interestthereon, as hereinafter set forth (the “Note”). Interest at the rate of twelve percent (12%) per annum on the principalsum of this Note from time to time outstanding shall be due commencing March 31,2005, and continuing quarterly thereafter, prior to maturity or acceleration,quarterly payments of interest shall be due and payable. In addition, interestat the rate of four percent (4%) per annum (the “PIK Interest”) shall be payableupon the Maturity Date by increasing the outstanding principal amount hereunderby the amount of such PIK Interest at the rate of 1% of the original principalamount on the last day of each calendar quarter commencing with and pro ratedfor the calendar quarter ended March 31, 2005. The Borrower is not required toissue additional or new notes to evidence the additional principal amountsoutstanding hereunder but rather this Note shall be automatically amended toevidence such additional amounts. This note is the note referred to in the Security Agreement, a copy ofwhich is attached hereto as Exhibit A (the “Security Agreement”), and is securedby the liens granted pursuant to the Security Agreement, is entitled to thebenefits of the Security Agreement, and is subject to all of the agreements,terms and conditions contained therein. Borrower has the privilege to prepay, without penalty or premium, theindebtedness evidenced hereby in full or in part upon five (5) business daysprior written notice to Lender. Borrower shall prepay, without penalty orpremium, the indebtedness to the Lender in an amount equal to the net proceeds(including reduction for income, transfer and other applicable taxes andtransfer costs) of the sale of any Collateral (as defined in the SecurityAgreement attached hereto as Exhibit A) other than sales in the ordinary courseof business. All payments received by Lender shall be applied by Lender to thepayment due hereunder in such manner and in such order as Lender may determinein Lender’s sole and absolute discretion. Payment shall continue to be due andpayable as provided herein, until this Note is paid in full. 11. Events of Default. A. This Note shall become and be due and payable upon written demand madeby the holder hereof if one or more of the following events, herein calledevents of default, shall happen and be continuing: (i) Default in the payment of the principal or accrued interest onthe Note when and as the same shall become due and payable, whether byacceleration or otherwise; (ii) Default in the due observance or performance of any materialcovenant, condition or agreement on the part of the Borrower to be observed orperformed pursuant to the terms hereof and such default shall continue uncuredfor twenty (20) days after written notice thereof, specifying such default,shall have been given to the Borrower by the holder of the Note; (iii) Application for, or consent to, the appointment of a receiver,trustee or liquidator of the Borrower or of its property; (iv) Admission in writing of the Borrower’s inability to pay itsdebts as they mature; (v) General assignment by the Borrower for the benefit of creditors; (vi) Filing by the Borrower of a voluntary petition in bankruptcy ora petition or an answer seeking reorganization, or an arrangement withcreditors; (vii) Entering against the Borrower of a court order approving apetition filed against it under the Federal bankruptcy laws, which order shallnot have been vacated or set aside or otherwise terminated within sixty (60)days; (viii) The sale of all or substantially all of the Borrower’sassets; (ix) The merger or consolidation of Borrower (other than into anentity controlled by a21, Inc.) or the sale of greater than fifty percent (50%)of the issued and outstanding shares of Borrower; or (x) The Borrower shall incur, create, assume or suffer to exist anyindebtedness other than (A) indebtedness to __________________________, (B)indebtedness existing as of the date hereof and listed on Schedule 1.A(ix)(B),(C) indebtedness owing in the ordinary course of business to trade suppliersarising on or after the date hereof, (D) deferred taxes, (E) indebtedness thatis by its terms subordinated to the repayment of the Note on terms andconditions reasonably acceptable to Lender, (F) the incurrence of indebtednessfor the purpose of financing all or any part of the purchase price of any assetin an amount not to exceed Two Hundred and Fifty Thousand Dollars ($250,000)during any fiscal year of the Borrower, (G) any other indebtedness so long asnot less than fifty percent (50%) of the net proceeds of such indebtedness isused to pay amounts owing under the Note, (H) indebtedness to fund the workingcapital needs of the Borrower provided it obtains the Lender’s prior writtenconsent, which consent shall not be unreasonably withheld or delayed and (I)indebtedness issued in exchange for, or the proceeds of which are used toextend, refinance, renew, replace, substitute or refund in whole or in partindebtedness permitted to be incurred under clauses (A), (B), (C), (D), (E),(F), (G) or (H) above, this clause (ix) (“Refinancing Indebtedness”); provided,however, that the principal amount of such Refinancing Indebtedness shall notexceed the principal amount and accrued interest of the indebtedness soextended, refinanced, renewed, replaced, substituted or refunded and anypremiums payable and reasonable fees, expenses, commissions and costs incurredin connection therewith. B. The Borrower agrees that notice of the occurrence of any event ofdefault will be promptly given to the holder at its registered address bycertified mail. C. In case any one or more of the events of default specified above shallhappen and be continuing, the holder of this Note may proceed to protect andenforce his rights by suit in the specific performance of any covenant oragreement contained in this Note or in aid of the exercise of any power grantedin this Note or may proceed to enforce the payment of this Note or to enforceany other legal or equitable rights as such holder. D. In case of an event of default, interest on the Note shall be equal tothe interest as calculated in the second paragraph of this Note, plus fourpercent (4%).2. Lender Representations. A. Lender (i) is an “accredited investor,” as that term is defined inRegulation D under the Act; (ii) has such knowledge, skill and experience inbusiness and financial matters, based on actual participation, that he iscapable of evaluating the merits and risks of an investment in the Borrower andthe suitability thereof as an investment for Lender; (iii) has received suchdocuments and information as he has requested and has had an opportunity to askquestions of representatives of the Borrower concerning the terms and conditionsof the investment proposed herein, and such questions were answered to thesatisfaction of Lender; and (iv) is in a financial position to hold the Note foran indefinite time and is able to bear the economic risk and withstand acomplete loss of its investment in the Borrower. B. Lender is acquiring the Note for investment for his own account and notwith a view to, or for resale in connection with, any distribution thereof. C. Lender understands that the Note has not been registered underapplicable state or federal securities laws. Lender acknowledges that by virtueof the provisions of certain rules respecting “restricted securities”promulgated by the Securities and Exchange Commission, the Note will be requiredto be held indefinitely, unless and until registered under the Act andapplicable state securities laws, or unless an exemption from the registrationrequirements of the Act and applicable state securities laws is available. The failure of Lender at any time to exercise any option or righthereunder shall not constitute a waiver of Lender’s right to exercise suchoption or right at any other time. The obligations to make the payments provided for in this Note areabsolute and unconditional and not subject to any defense, set-off,counterclaim, rescission, recoupment, or adjustment whatsoever. The Borrowerhereby expressly waives demand and presentment for payment, notice ofnonpayment, notice of dishonor, protest, notice of protest, bringing of suit,and diligence in taking any action to collect any amount called for hereunder,and shall be directly and primarily liable for the payment of all sums owing andto be owing hereon, regardless of and without any notice, diligence, act, oromission with respect to the collection of any amount called for hereunder. 2 As used herein, the term “Lender” shall mean the Lender identified hereinand his successors and assigns and any and all other holders of this Note. IF ANY PROVISION OF THIS NOTE IS HELD TO BE INVALID OR UNENFORCEABLE BY ACOURT OF COMPETENT JURISDICTION, THE OTHER PROVISIONS OF THIS NOTE SHALL REMAININ FULL FORCE AND EFFECT. IF THE PAYMENT OF ANY INTEREST DUE HEREUNDER WOULDSUBJECT LENDER TO ANY PENALTY UNDER APPLICABLE LAW, THEN THE PAYMENTS DUEHEREUNDER SHALL BE AUTOMATICALLY REDUCED TO WHAT THEY WOULD BE AT THE HIGHESTRATE AUTHORIZED UNDER APPLICABLE LAW. This Note shall be governed by, construed, and enforced in accordance withthe laws of The State of New York. Any notice required or permitted to be delivered hereunder shall be inwriting and shall be deemed to be delivered on the earlier of: (i) the datereceived, or (ii) the date of delivery, refusal, or non-delivery indicated onthe return receipt if deposited in a United States Postal Service depository,postage prepaid, sent registered or certified mail, return receipt requested,addressed to the party to receive the same at the address of such party setforth at the beginning of this Note, or at such other address as may bedesignated in a notice delivered or mailed as herein provided. Executed under seal as of the date first above written. BORROWER: SUPERSTOCK, INC. By: ___________________________________ Name: Thomas Butta Title: Chief Executive Officer LENDER: By: ___________________________________ Name: Title: GUARANTY a21, Inc. (“Guarantor”) hereby unconditionally guarantees the full andprompt payment when due, whether by acceleration or otherwise, and at all timesthereafter, of all obligations of the Borrower to the Lender with respect toprincipal payments and any and all other amount payable to Lender under thisNote, now or hereafter existing, or due to become due (all such obligationshereinafter collectively called the “Guaranteed Obligations”). This Guaranty isa continuing, absolute and unconditional Guaranty, and will remain in full forceand effect until the Guaranteed Obligations have been indefeasibly paid in full.In order to secure its obligations under this Guaranty, Guarantor hereby agreesthat, to the extent not otherwise prohibited under any law or contractualobligation, it shall use reasonable commercial efforts to cause each entity itcontrols whose stock, partnership or membership interest is acquired byGuarantor following the date hereof, to grant to Lender a lien and securityinterest in all assets of such entity. a21, INC. AS GUARANTOR: By: ___________________________________ Name: Thomas Butta Title: President Exhibit A Security Agreement Schedule 1.A(ix)(B)