Exhibit 10.2
 
THIS NOTE AND THE COMMON SHARES ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAWS. THIS NOTE AND THE COMMON SHARES ISSUABLE UPON CONVERSION OF
THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS NOTE UNDER SAID ACT
AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO CONVERSION SERVICES INTERNATIONAL, INC. THAT SUCH REGISTRATION
IS NOT REQUIRED.
 
AMENDED AND RESTATED SECURED CONVERTIBLE TERM NOTE
 
FOR VALUE RECEIVED, CONVERSION SERVICES INTERNATIONAL, INC., a Delaware
corporation (the “Borrower”), hereby promises to pay to LAURUS MASTER FUND,
LTD., c/o Ogier Fiduciary Services (Cayman) Limited, P.O. Box 1234, Queensgate
House, South Church Street, George Town, Grand Cayman, Cayman Islands, British
West Indies, Fax: 345-949-9877 (the “Holder”) or its registered assigns or
successors in interest, on order, the sum of SEVEN HUNDRED FORTY NINE THOUSAND
DOLLARS ($749,000), together with any accrued and unpaid interest hereon, on
August 15, 2007 (the “Maturity Date”) if not sooner paid. The original principal
amount of this Note is subject to amortizing payments pursuant to Section 1.2
hereof is hereinafter referred to as the “Amortizing Principal Amount”. This
Note amends and restates in its entirety, and is given in substitution for and
not in satisfaction of, that certain Secured Convertible Term Note in the
original principal amount of $5,000,000 issued by the Company in favor of the
Holder on August 16, 2004, as amended and restated on July 28, 2005.
 
Capitalized terms used herein without definition shall have the meanings
ascribed to such terms in that certain Securities Purchase Agreement dated as of
the date hereof between the Borrower and the Holder (the “Purchase Agreement”).
 
The following terms shall apply to this Note:
 
ARTICLE I
INTEREST & AMORTIZATION
 
1.1 (a) Interest Rate. Subject to Sections 1.1(b), 4.12 and 5.6 hereof, interest
payable on this Note shall accrue at a rate per annum (the “Interest Rate”)
equal to the “prime rate” published in The Wall Street Journal from time to
time, plus one percent (1%). The prime rate shall be increased or decreased as
the case may be for each increase or decrease in the prime rate in an amount
equal to such increase or decrease in the prime rate; each change to be
effective as of the day of the change in such rate. Subject to Section 1.1(b)
hereof, the Interest Rate shall not be less than five percent (5%). Interest
shall be calculated on the basis of a 360 day year. Interest on the Amortizing
Principal Amount shall be payable monthly, in arrears, commencing on October 1,
2004 and on the first day of each consecutive calendar month thereafter (each, a
“Repayment Date”) and on the Maturity Date, whether by acceleration or
otherwise. .
 
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1.1 (b) Interest Rate Adjustment. The Interest Rate shall be subject to
adjustment on the last business day of each month hereafter until the Maturity
Date (each a “Determination Date”). If on any Determination Date (i) the
Borrower shall have registered under the Securities Act of 1933, as amended (the
“Securities Act”), the shares of Common Stock underlying each of the conversion
of this Note and the exercise of the Warrant issued on a registration statement
declared effective by the Securities and Exchange Commission (the “SEC”), and
(ii) the market price (the “Market Price”) of the Common Stock as reported by
Bloomberg, L.P. on the Principal Market (as defined below) for the five (5)
consecutive trading days immediately preceding such Determination Date exceeds
the then applicable Fixed Conversion Price by at least twenty five percent
(25%), the Interest Rate for the succeeding calendar month shall automatically
be reduced by 200 basis points (200 b.p.) (2.0.%) for each incremental twenty
five percent (25%) increase in the Market Price of the Common Stock above the
then applicable Fixed Conversion Price. If on any Determination Date (i) the
Borrower shall not have registered under the Securities Act the shares of Common
Stock underlying the conversion of this Note and the exercise of the Warrant on
a registration statement declared effective by the SEC or the Borrower shall
have registered such shares under the Securities Act but on such Determination
Date the related registration statement is not effective, and (ii) the Market
Price of the Common Stock as reported by Bloomberg, L.P. on the Principal Market
for the five (5) consecutive trading days immediately preceding such
Determination Date exceeds the then applicable Fixed Conversion Price by at
least twenty five percent (25%), the Interest Rate for the succeeding calendar
month shall automatically be decreased by 100 basis points (100 b.p.) (1.0.%)
for each incremental twenty five percent (25%) increase in the Market Price of
the Common Stock above the then applicable Fixed Conversion Price.
Notwithstanding the foregoing (and anything to the contrary contained in
herein), in no event shall the Interest Rate be less than zero percent (0%).  
 
1.2 Minimum Monthly Principal Payments. Amortizing payments of the aggregate
principal amount outstanding under this Note at any time (the “Principal
Amount”) shall be made by the Company commencing on October 1, 2005_and on the
first business day of each succeeding month thereafter through and including the
Maturity Date (each, an “Amortization Date”). Subject to Article III below,
commencing on the first Amortization Date, the Company shall make monthly
payments to the Holder on each Repayment Date, each such payment in the amount
of $32,565 together with any accrued and unpaid interest on such portion of the
Principal Amount plus any and all other unpaid amounts which are then owing
under this Note, the Purchase Agreement and/or any other Related Agreement
(collectively, the “Monthly Amount”). Any outstanding Principal Amount together
with any accrued and unpaid interest and any and all other unpaid amounts which
are then owing by the Company to the Holder under this Note, the Purchase
Agreement and/or any other Related Agreement shall be due and payable on the
Maturity Date.
 
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ARTICLE II
CONVERSION REPAYMENT
 
2.1 (a) Payment of Monthly Amount in Cash or Common Stock. If the Monthly Amount
(or a portion thereof of such Monthly Amount if such portion of the Monthly
Amount would have been converted into shares of Common Stock but for Section
3.2) is required to be paid in cash pursuant to Section 2.1(b), then the
Borrower shall pay the Holder an amount equal to 100% of the Monthly Amount due
and owing to the Holder on the Repayment Date in cash. If the Monthly Amount (or
a portion of such Monthly Amount if not all of the Monthly Amount may be
converted into shares of Common Stock pursuant to Section 3.2) is required to be
paid in shares of Common Stock pursuant to Section 2.1(b), the number of such
shares to be issued by the Borrower to the Holder on such Repayment Date (in
respect of such portion of the Monthly Amount converted into in shares of Common
Stock pursuant to Section 2.1(b)), shall be the number determined by dividing
(x) the portion of the Monthly Amount converted into shares of Common Stock, by
(y) the then applicable Fixed Conversion Price. For purposes hereof, the initial
“Fixed Conversion Price” means $1.00.
 
(b)  Monthly Amount Conversion Guidelines. Subject to Sections 2.1(a), 2.2 and
3.2 hereof, the Holder shall convert into shares of Common Stock all or a
portion of the Monthly Amount due on each Repayment according to the following
guidelines (collectively, the “Conversion Criteria”): (i) the average closing
price of the Common Stock as reported by Bloomberg, L.P. on the Principal Market
for the five (5) consecutive trading days immediately preceding such Notice Date
shall be greater than or equal to 110% of the Fixed Conversion Price and (ii)
the amount of such conversion does not exceed twenty five percent (25%) of the
aggregate dollar trading volume of the Common Stock for the twenty two (22) day
trading period immediately preceding delivery of a Repayment Notice. If the
Conversion Criteria are not met, the Holder shall convert only such part of the
Monthly Amount that meets the Conversion Criteria. Any part of the Monthly
Amount due on a Repayment Date that the Holder has not been able to convert into
shares of Common Stock due to failure to meet the Conversion Criteria, shall be
paid by the Borrower in cash on such Repayment Date, within three (3) business
days of the applicable Repayment Date.
 
 (c) Application of Conversion Amounts. Any amounts converted by the Holder
pursuant to Section 2.1(b) shall be deemed to constitute payments of, or applied
against, (i) first, outstanding fees, (ii) second, accrued interest on the
Amortizing Principal Amount, and (iii) third, the Amortizing Principal Amount.
 
2.2 No Effective Registration. Notwithstanding anything to the contrary herein,
no amount payable hereunder may be converted into Common Stock unless (a) either
(i) an effective current Registration Statement (as defined in the Registration
Rights Agreement) covering the shares of Common Stock to be issued in
satisfaction of such obligations exists, or (ii) an exemption from registration
of the Common Stock is available pursuant to Rule 144 of the Securities Act, and
(b) no Event of Default hereunder exists and is continuing, unless such Event of
Default is cured within any applicable cure period or is otherwise waived in
writing by the Holder in whole or in part at the Holder’s option.
 
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2.3 Optional Redemption of Amortizing Principal Amount. The Borrower will have
the option of prepaying the outstanding Amortizing Principal Amount (“Optional
Amortizing Redemption”), in whole or in part, by paying to the Holder a sum of
money equal to one hundred fifteen percent (115%) of the Amortizing Principal
Amount to be redeemed, together with accrued but unpaid interest thereon and any
and all other sums due, accrued or payable to the Holder arising under this
Note, the Purchase Agreement or any Related Agreement (the “Amortizing
Redemption Amount”) on the day written notice of redemption (the “Notice of
Amortizing Redemption”) is given to the Holder. The Notice of Amortizing
Redemption shall specify the date for such Optional Amortizing Redemption (the
“Amortizing Redemption Payment Date”), which date shall be not less than seven
(7) business days after the date of the Notice of Amortizing Redemption (the
“Redemption Period”). A Notice of Amortizing Redemption shall not be effective
with respect to any portion of the Amortizing Principal Amount for which the
Holder has a pending election to convert pursuant to Section 3.1, or for
conversions initiated or made by the Holder pursuant to Section 3.1 during the
Redemption Period. The Amortizing Redemption Amount shall be determined as if
such Holder’s conversion elections had been completed immediately prior to the
date of the Notice of Amortizing Redemption. On the Amortizing Redemption
Payment Date, the Amortizing Redemption Amount shall be paid in good funds to
the Holder. In the event the Borrower fails to pay the Amortizing Redemption
Amount on the Amortizing Redemption Payment Date as set forth herein, then such
Notice of Amortizing Redemption will be null and void.
 
ARTICLE III
CONVERSION RIGHTS
 
3.1. Holder’s Conversion Rights. Subject to Section 2.2, the Holder shall have
the right, but not the obligation, to convert all or any portion of the then
aggregate outstanding Principal Amount of this Note, together with interest and
fees due hereon, into shares of Common Stock, subject to the terms and
conditions set forth in this Article III. The Holder may exercise such right by
delivery to the Borrower of a written Notice of Conversion pursuant to Section
3.3.
 
3.2 Conversion Limitation. Notwithstanding anything contained herein to the
contrary, the Holder shall not be entitled to convert pursuant to the terms of
this Note an amount that would (a) be convertible into that number of shares of
Common Stock which, when added to the number of shares of Common Stock otherwise
beneficially owned by such Holder including those issuable upon exercise of
warrants held by such Holder would exceed 4.99% of the outstanding shares of
Common Stock of the Borrower at the time of conversion or (b) exceed twenty five
percent (25%) of the aggregate dollar trading volume of the Common Stock for the
twenty two (22) day trading period immediately preceding delivery of a Notice of
Conversion to the Borrower. For the purposes of the immediately preceding
sentence, beneficial ownership shall be determined in accordance with Section
13(d) of the Exchange Act and Regulation 13d-3 thereunder. The conversion
limitation described in this Section 3.2 shall automatically become null and
void without any notice to Borrower upon the occurrence and during the
continuance beyond any applicable grace period of an Event of Default, or upon
75 days prior notice to the Borrower, except that at no time shall the
beneficial ownership exceed 19.99% of the Common Stock. Notwithstanding anything
contained herein to the contrary, following the listing of the Borrower on the
NASDAQ SmallCap Market, the Nasdaq National Market or the American Stock
Exchange, the number of shares of Common Stock issuable by the Borrower and
acquirable by the Holder at a price below $0.20 per share pursuant to the terms
of this Note, the Security Agreement, any Ancillary Agreement or any other
agreement between the Company and the Holder, shall not exceed an aggregate of
153,149,330 shares of the Borrower’s Common Stock (subject to appropriate
adjustment for stock splits, stock dividends, or other similar recapitalizations
affecting the Common Stock) (the “Maximum Common Stock Issuance”), unless the
issuance of shares hereunder in excess of the Maximum Common Stock Issuance
shall first be approved by the Borrower’s shareholders. If at any point in time
, following the listing of the Borrower on the NASDAQ SmallCap Market, the
Nasdaq National Market or the American Stock Exchange, the number of shares of
Common Stock issued pursuant to the terms of this Note, the Security Agreement,
any Ancillary Agreement or any other agreement between the Company and the
Holder, together with the number of shares of Common Stock that would then be
issuable by the Borrower to the Holder in the event of a conversion or exercise
pursuant to the terms of this Note, the Security Agreement, any Ancillary
Agreement or any other agreement between the Company and the Holder, would
exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower
shall promptly call a shareholders meeting to solicit shareholder approval for
the issuance of the shares of Common Stock hereunder in excess of the Maximum
Common Stock Issuance.
 
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3.3 Mechanics of Holder’s Conversion. (a) In the event that the Holder elects to
convert any amounts outstanding under this Note into Common Stock, the Holder
shall give notice of such election by delivering an executed and completed
notice of conversion (a “Notice of Conversion”) to the Borrower, which Notice of
Conversion shall provide a breakdown in reasonable detail of the Principal
Amount, accrued interest and fees being converted. On each Conversion Date (as
hereinafter defined) and in accordance with its Notice of Conversion, the Holder
shall make the appropriate reduction to the Principal Amount, accrued interest
and fees as entered in its records and shall provide written notice thereof to
the Borrower within two (2) business days after the Conversion Date. Each date
on which a Notice of Conversion is delivered or telecopied to the Borrower in
accordance with the provisions hereof shall be deemed a “Conversion Date”. A
form of Notice of Conversion to be employed by the Holder is annexed hereto as
Exhibit A.

(b)  Pursuant to the terms of a Notice of Conversion, the Borrower will issue
instructions to the transfer agent accompanied by an opinion of counsel, if so
required by the Borrower’s transfer agent, within two (2) business days of the
date of the delivery to Borrower of the Notice of Conversion and shall cause the
transfer agent to transmit the certificates representing the Conversion Shares
to the Holder by crediting the account of the Holder’s designated broker with
the Depository Trust Corporation (“DTC”) through its Deposit Withdrawal Agent
Commission (“DWAC”) system within three (3) business days after receipt by the
Borrower of the Notice of Conversion (the “Delivery Date”). In the case of the
exercise of the conversion rights set forth herein the conversion privilege
shall be deemed to have been exercised and the Conversion Shares issuable upon
such conversion shall be deemed to have been issued upon the date of receipt by
the Borrower of the Notice of Conversion. The Holder shall be treated for all
purposes as the record holder of such shares of Common Stock, unless the Holder
provides the Borrower written instructions to the contrary.

3.4 Conversion Mechanics.
 
(a) The number of shares of Common Stock to be issued upon each conversion of
this Note pursuant to this Article III shall be determined by dividing that
portion of the Principal Amount and interest and fees to be converted, if any,
by the then applicable Fixed Conversion Price. In the event of any conversions
of outstanding obligations under this Note in part pursuant to this Article III,
such conversions shall be deemed to constitute conversions (i) first, of the
Monthly Amount for the current calendar month, and (ii)second, of outstanding
Amortizing Principal Amount, by applying the conversion amount to Monthly
Amounts for the remaining Repayment Dates in chronological order.
 
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(b) The Fixed Conversion Price and number and kind of shares or other securities
to be issued upon conversion is subject to adjustment from time to time upon the
occurrence of certain events, as follows:
 
A. Stock Splits, Combinations and Dividends. If the shares of Common Stock are
subdivided or combined into a greater or smaller number of shares of Common
Stock, or if a dividend is paid on the Common Stock in shares of Common Stock,
the Fixed Conversion Price or the Conversion Price, as the case may be, shall be
proportionately reduced in case of subdivision of shares or stock dividend or
proportionately increased in the case of combination of shares, in each such
case by the ratio which the total number of shares of Common Stock outstanding
immediately after such event bears to the total number of shares of Common Stock
outstanding immediately prior to such event.
 
B. During the period the conversion right exists, the Borrower will reserve from
its authorized and unissued Common Stock a sufficient number of shares to
provide for the issuance of Common Stock upon the full conversion of this Note.
The Borrower represents that upon issuance, such shares will be duly and validly
issued, fully paid and non-assessable. The Borrower agrees that its issuance of
this Note shall constitute full authority to its officers, agents, and transfer
agents who are charged with the duty of executing and issuing stock certificates
to execute and issue the necessary certificates for shares of Common Stock upon
the conversion of this Note.
 
C. Share Issuances. Subject to the provisions of this Section 3.4, if the
Borrower shall at any time prior to the conversion or repayment in full of the
Principal Amount issue any shares of Common Stock or securities convertible into
Common Stock to a person other than the Holder (except (i) pursuant to
Subsections A or B above; or (ii) pursuant to options that may be issued under
any employee incentive stock option and/or any qualified stock option plan
adopted by the Borrower) for a consideration per share (the “Offer Price”) less
than the Fixed Conversion Price in effect at the time of such issuance, then the
Fixed Conversion Price shall be immediately reset to such lower Offer Price at
the time of issuance of such securities. For purposes hereof, the issuance of
any security of the Borrower convertible into or exercisable or exchangeable for
Common Stock shall result in an adjustment to the Fixed Conversion Price at the
time of issuance of such securities.
 
D.  Reclassification, etc. If the Borrower at any time shall, by
reclassification or otherwise, change the Common Stock into the same or a
different number of securities of any class or classes, this Note, as to the
unpaid Principal Amount and accrued interest thereon, shall thereafter be deemed
to evidence the right to purchase an adjusted number of such securities and kind
of securities as would have been issuable as the result of such change with
respect to the Common Stock immediately prior to such reclassification or other
change.
 
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3.5 Issuance of Replacement Note. Upon any partial conversion of this Note, a
replacement Note containing the same date and provisions of this Note shall, at
the written request of the Holder, be issued by the Borrower to the Holder for
the outstanding Principal Amount of this Note and accrued interest which shall
not have been converted or paid. Subject to the provisions of Article IV, the
Borrower will pay no costs, fees or any other consideration to the Holder for
the production and issuance of a replacement Note.
 
ARTICLE IV
EVENTS OF DEFAULT
 
 Upon the occurrence and continuance of an Event of Default beyond any
applicable grace period, the Holder may accelerate all obligations outstanding
under the Purchase Agreement and the Related Agreements and, in connection
therewith, make all sums of principal, interest and other fees then remaining
unpaid hereon and all other amounts payable hereunder immediately due and
payable. In the event of such an acceleration, the amount due and owing to the
Holder shall be 130% of the outstanding principal amount of the Note (plus
accrued and unpaid interest and fees, if any) (the “Default Payment”). The
Default Payment shall be applied first to any fees due and payable to Holder
pursuant to this Note, the Purchase Agreement or the Related Agreements, then to
accrued and unpaid interest due on the Note and then to outstanding principal
balance of the Note.
 
The occurrence of any of the following events set forth in Sections 4.1 through
4.10, inclusive, is an “Event of Default”:
 
4.1 Failure to Pay Principal, Interest or other Fees. The Borrower fails to pay
when due any installment of principal, interest or other fees hereon in
accordance herewith, or the Borrower fails to pay when due any amount due under
any other promissory note issued by Borrower, and in any such case, such failure
shall continue for a period of three (3) days following the date upon which any
such payment was due.
 
4.2 Breach of Covenant. The Borrower breaches any covenant or any other term or
condition of this Note or the Purchase Agreement in any material respect, or the
Borrower or any of its Subsidiaries breaches any covenant or any other term or
condition of any Related Agreement in any material respect and, any such case,
such breach, if subject to cure, continues for a period of thirty (30) days
after the occurrence thereof.
 
4.3 Breach of Representations and Warranties. Any representation or warranty
made by the Borrower in this Note or the Purchase Agreement, or by the Borrower
or any of its Subsidiaries in any Related Agreement, shall, in any such case, be
false or misleading in any material respect on the date that such representation
or warranty was made or deemed made.
 
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4.4 Receiver or Trustee. The Borrower or any of its Subsidiaries shall make an
assignment for the benefit of creditors, or apply for or consent to the
appointment of a receiver or trustee for it or for a substantial part of its
property or business; or such a receiver or trustee shall otherwise be
appointed.
 
4.5 Judgments. Any money judgment, writ or similar final process shall be
entered or filed against the Borrower or any of its Subsidiaries or any of their
respective property or other assets for more than $150,000, and shall remain
unvacated, unbonded or unstayed for a period of thirty (30) days.
 
4.6 Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation
proceedings or other proceedings or relief under any bankruptcy law or any law
for the relief of debtors shall be instituted by or against the Borrower or any
of its Subsidiaries.
 
4.7 Stop Trade. An SEC stop trade order or Principal Market trading suspension
of the Common Stock shall be in effect for fifteen (15) consecutive days or
fifteen (15) days during a period of thirty (30) consecutive days, excluding in
all cases a suspension of all trading on a Principal Market, provided that the
Borrower shall not have been able to cure such trading suspension within thirty
(30) days of the notice thereof or list the Common Stock on another Principal
Market within sixty (60) days of such notice. The “Principal Market” for the
Common Stock shall include the NASD OTC Bulletin Board, NASDAQ SmallCap Market,
NASDAQ National Market System, American Stock Exchange, or New York Stock
Exchange (whichever of the foregoing is at the time the principal trading
exchange or market for the Common Stock, or any securities exchange or other
securities market on which the Common Stock is then being listed or traded.
 
4.8 Failure to Deliver Common Stock or Replacement Note. The Borrower shall fail
(i) to timely deliver Common Stock to the Holder pursuant to and in the form
required by this Note, and Section 9 of the Purchase Agreement, if such failure
to timely deliver Common Stock shall not be cured within two (2) business days
or (ii) to deliver a replacement Note to Holder within seven (7) business days
following the required date of such issuance pursuant to this Note, the Purchase
Agreement or any Related Agreement (to the extent required under such
agreements).
 
4.9  Default Under Related Agreements or Other Agreements. The occurrence and
continuance of any Event of Default (as defined in the Purchase Agreement or any
Related Agreement) or any event of default (or similar term) under any other
indebtedness.
 
4.10  Change in Control.(i) Any “Person” or “group” (as such terms are defined
in Sections 13(d) and 14(d) of the Exchange Act, as in effect on the date
hereof) is or becomes the “beneficial owner” (as defined in Rules 13(d)-3 and
13(d)-5 under the Exchange Act), directly or indirectly, of 45% or more on a
fully diluted basis of the then outstanding voting equity interest of the
Borrower or (ii) the Board of Directors of the Borrower shall cease to consist
of a majority of the Board of Directors of the Borrower on the date hereof (or
directors appointed by a majority of the Board of Directors in effect
immediately prior to such appointment).
 
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DEFAULT RELATED PROVISIONS
 
4.11 Default Interest Rate. Following the occurrence and during the continuance
of an Event of Default, the Borrower shall pay additional interest on this Note
in an amount equal to two percent (2%) per month, and all outstanding
obligations under this Note, including unpaid interest, shall continue to accrue
such additional interest from the date of such Event of Default until the date
such Event of Default is cured or waived.
 
4.12 Conversion Privileges. The conversion privileges set forth in Article III
shall remain in full force and effect immediately from the date hereof and until
this Note is paid in full.
 
4.13 Cumulative Remedies. The remedies under this Note shall be cumulative.
 
ARTICLE V
MISCELLANEOUS
 
5.1 Failure or Indulgence Not Waiver. No failure or delay on the part of the
Holder hereof in the exercise of any power, right or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such power, right or privilege preclude other or further exercise thereof or of
any other right, power or privilege. All rights and remedies existing hereunder
are cumulative to, and not exclusive of, any rights or remedies otherwise
available.
 
5.2 Notices. Any notice herein required or permitted to be given shall be in
writing and shall be deemed effectively given: (a) upon personal delivery to the
party notified, (b) when sent by confirmed telex or facsimile if sent during
normal business hours of the recipient, if not, then on the next business day,
(c) five days after having been sent by registered or certified mail, return
receipt requested, postage prepaid, or (d) one day after deposit with a
nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to the
Borrower at the address provided in the Purchase Agreement executed in
connection herewith, and to the Holder at the address provided in the Purchase
Agreement for such Holder, with a copy to John E. Tucker, Esq., 825 Third
Avenue, 14th Floor, New York, New York 10022, facsimile number (212) 541-4434,
or at such other address as the Borrower or the Holder may designate by ten days
advance written notice to the other parties hereto. A Notice of Conversion shall
be deemed given when made to the Borrower pursuant to the Purchase Agreement.
 
5.3 Amendment Provision. The term “Note” and all reference thereto, as used
throughout this instrument, shall mean this instrument as originally executed,
or if later amended or supplemented, then as so amended or supplemented, and any
successor instrument issued pursuant to Section 3.5 hereof, as it may be amended
or supplemented.
 
5.4 Assignability. This Note shall be binding upon the Borrower and its
successors and assigns, and shall inure to the benefit of the Holder and its
successors and assigns, and may be assigned by the Holder in accordance with the
requirements of the Purchase Agreement. This Note shall not be assigned by the
Borrower without the consent of the Holder.
 
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5.5 Governing Law. This Note shall be governed by and construed in accordance
with the laws of the State of New York, without regard to principles of
conflicts of laws. Any action brought by either party against the other
concerning the transactions contemplated by this Agreement shall be brought only
in the state courts of New York or in the federal courts located in the state of
New York. Both parties and the individual signing this Note on behalf of the
Borrower agree to submit to the jurisdiction of such courts. The prevailing
party shall be entitled to recover from the other party its reasonable
attorney’s fees and costs. In the event that any provision of this Note is
invalid or unenforceable under any applicable statute or rule of law, then such
provision shall be deemed inoperative to the extent that it may conflict
therewith and shall be deemed modified to conform with such statute or rule of
law. Any such provision which may prove invalid or unenforceable under any law
shall not affect the validity or unenforceability of any other provision of this
Note. Nothing contained herein shall be deemed or operate to preclude the Holder
from bringing suit or taking other legal action against the Borrower in any
other jurisdiction to collect on the Borrower’s obligations to Holder, to
realize on any collateral or any other security for such obligations, or to
enforce a judgment or other court in favor of the Holder.
 
5.6 Maximum Payments. Nothing contained herein shall be deemed to establish or
require the payment of a rate of interest or other charges in excess of the
maximum permitted by applicable law. In the event that the rate of interest
required to be paid or other charges hereunder exceed the maximum permitted by
such law, any payments in excess of such maximum shall be credited against
amounts owed by the Borrower to the Holder and thus refunded to the Borrower.
 
5.7 Security Interest and Guarantee. The Holder has been granted a security
interest (i) in certain assets of the Borrower and its Subsidiaries as more
fully described in the Master Security Agreement dated as of the date hereof and
(ii) pursuant to the Stock Pledge Agreement dated as of the date hereof. The
obligations of the Borrower under this Note are guaranteed by certain
Subsidiaries of the Borrower pursuant to the Subsidiary Guaranty dated as of the
date hereof.
 
5.8  Construction. Each party acknowledges that its legal counsel participated
in the preparation of this Note and, therefore, stipulates that the rule of
construction that ambiguities are to be resolved against the drafting party
shall not be applied in the interpretation of this Note to favor any party
against the other.
 
5.9  Cost of Collection. If default is made in the payment of this Note, the
Borrower shall pay to Holder reasonable costs of collection, including
reasonable attorney’s fees.
 
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IN WITNESS WHEREOF, the Borrower has caused this Amended and Restated Secured
Convertible Term Note to be signed in its name effective as of this 30th day of
November 2005.

        CONVERSION SERVICES INTERNATIONAL, INC.  
   
   
    By:   /s/ Scott Newman   

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Name: Scott Newman   
Title:   President and Chief Executive Officer

WITNESS:

/s/ Lawrence F. Metz

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EXHIBIT A
 
NOTICE OF CONVERSION

(To be executed by the Holder in order to convert all or part of the Note into
Common Stock

[Name and Address of Holder]

The Undersigned hereby converts $_________ of the principal due on [specify
applicable Repayment Date] under the Amended and Restated Secured Convertible
Term Note issued by Conversion Services International, Inc. dated August 16,
2004, as amended and restated on July 28, 2005 and further amended and restated
on November 30, 2005, by delivery of Shares of Common Stock of Conversion
Services International, Inc. on and subject to the conditions set forth in
Article III of such Note.

1. Date of Conversion                  _______________________

2. Shares To Be Delivered:   _______________________

By:_______________________________
Name:_____________________________
Title:______________________________

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