THIS PROMISSORY NOTE HAS
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”). NO SALE OR DISPOSITION MAY BE EFFECTED EXCEPT IN COMPLIANCE WITH RULE 144 UNDER SAID ACT OR PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT.


 


Net
Talk.com, Inc.


 


Secured
Promissory Note


 


	 	March 11, 2014\
	$4,071,939.84	Miami, Florida


 


For Value Received,
Net Talk.com, Inc., a Florida corporation (the “Company”), hereby unconditionally promises to pay to the order
of Telestrata, a Colorado limited liability company (the “Payee”), in lawful money of the United States of America
and in immediately available funds, the principal sum of four million seventy-one thousand nine hundred thirty-nine dollars and
eighty-four cents ($4,071,939.84) together with accrued and unpaid interest thereon, each due and payable on the dates and in the
manner set forth below.


 


1.          Interest.
Unpaid principal of this Note shall bear interest (computed on the basis of a year of 365 days of actual days elapsed), from the
date hereof until such principal is paid, at a rate per annum which shall be equal to five percent (5%).


 


2.          Increase in
Principal Amount. Payee has agreed, pursuant to that certain Restricted Stock and Warrant Purchase Agreement between the Company
and Payee, dated as of the date hereof (the “Purchase Agreement”), to make additional cash disbursements on
behalf of the Company in an amount of up to $500,000, pursuant to the terms set forth in the Purchase Agreement. The Company agrees
that, upon each such additional disbursement, the principal amount of this Note shall be increased by an amount equal to each such
additional disbursement. The additional disbursements, and the related increases in principal, shall be reflected on Exhibit
A hereto.


 


3.          Repayment.


 


		(a)	If not sooner paid in full, all outstanding principal and unpaid interest on this Note shall be
due and payable upon the earlier to occur of (i) March 1, 2016 (the “Maturity Date”) or (ii) an Event
of Default (as defined below).



 


		(b)	In the event that the Company issues and sells either shares of equity securities or debt securities
to one or more entities or individuals (the “Investors”) on or before the Maturity Date in a bona-fide arms-length
transaction for aggregate consideration of not less than $2,000,000 (a “Qualified Financing”), then the Company
shall pay, on the first day of the calendar month following the consummation of the Qualified Financing (the “Initial
Payment Date”), the Company shall pay to the Payee a Monthly Amount as set forth below (the “Monthly Payment
Amount”):



 




    	 



    	 



    

  


	Amount of Qualified Financing	 	Monthly Payment Amount (expressed as a fraction of the outstanding principal amount of the Note on the date of the first Monthly Payment)
	$10,000,000 or greater	 	1/18th
	$9,000,000 to $9,999,999	 	1/20th 
	$8,000,000 to $8,999,999	 	1/22nd 
	$7,000,000 to $7,999,999	 	1/26th 
	$6,000,000 to $6,999,999	 	1/30th 
	$5,000,000 to $5,999,999	 	1/36th 
	$4,000,000 to $4,999,999	 	1/45th 
	$3,000,000 to $3,999,999	 	1/60th 
	$2,000,000 to $2,999,999	 	1/90th 


 


together with
all accrued and unpaid interest as of the Initial Payment Date. Thereafter, on the first business day of each subsequent calendar
month (each a “Monthly Payment Date”), the Company shall pay to the Payee an amount equal to (x) all accrued
and unpaid interest as of the applicable Monthly Payment Date and (y) a Monthly Payment Amount equivalent to the amount set forth
on the table above (reflecting the aggregate amount of both the Qualified Financing and any additional equity or debt securities
issued by the Company after the Qualified Financing). On the Maturity Date, the Company will pay to the Payee all accrued and unpaid
interest as of the Maturity Date together with the remaining outstanding principal amount under this Note.


 


4.          Prepayment.
This Note may be prepaid by the Company prior to the Maturity Date without the written consent of the Payee.


 




    	 



    	 



    

  


5.          Repayment
Discount. Upon the repayment in full of a principal amount hereunder equal to $1,333,373.16 plus any additional disbursement
amounts set forth on Exhibit A hereto plus all accrued and unpaid interest (collectively, the “Base Payment
Amount”), the principal amount of this Note shall be decreased by $1,805,784.63 (the “Discount Amount”)
as follows:


 


		(a)	For each $309,594.02 of principal amount repaid, plus any accrued and unpaid interest to the date
of such repayment, in addition to the Base Payment Amount, the principal amount of the Note shall be reduced by $601,928.21.



 


		(b)	If, on the Maturity Date, or any such earlier date on which the Company elects to make a prepayment,
the entire outstanding principal amount and all accrued and unpaid interest payable under this Note is to repaid, the Company may
offset such outstanding principal amount by the Discount Amount.



 


For purposes of clarity,
in no event shall the aggregate principal amount payable under this Note be less than $2,262,155.20.


 


6.          Waiver.
The Company hereby waives demand, notice, presentment, protest and notice of dishonor. 


 


7.          Place of Payment.
All amounts payable hereunder shall be payable at a place of payment to be specified in writing by Payee no later than ten (10)
business days prior to a Payment Date. All payments shall be applied first to any fees or expenses due to the Payee, then to accrued
interest, including any interest that accrues after the commencement of a proceeding by or against the Company under Title 11 of
the United States Code, and thereafter to the outstanding Principal hereof. If any payments on this Note become due on a Saturday,
Sunday or a public holiday under the laws of the State of Florida, such payment shall be made on the next succeeding business day
and such extension of time shall be included in computing interest in connection with such payment.


 


8.          Event of Default.



 


(a)          Each of the
following events shall be an “Event of Default” hereunder:


 


(i)          the Company
engages in any liquidation, dissolution or winding up of the Company;


 


(ii)         the
Company files any petition or action for relief under any bankruptcy, reorganization, insolvency or moratorium law or any other
law for the relief of, or relating to, debtors, now or hereafter in effect, or makes any assignment for the benefit of creditors
or takes any corporate action in furtherance of any of the foregoing;


 


(iii)       an
involuntary petition is filed against the Company under any bankruptcy statute now or hereafter in effect, or a custodian, receiver,
trustee, assignee for the benefit of creditors (or other similar official) is appointed to take possession, custody or control
of any property of the Company;


 




    	 



    	 



    

  


(iv)        the
Company fails to pay, upon a demand made by the Payee any time after the Maturity Date, any and all outstanding principal, accrued
interest and other amounts owing hereunder (a “Payment Default”);


 


(v)         if within
5 business days from the date hereof the Payee does not have, and if at any time thereafter the Payee ceases to have, a valid and
perfected second priority security interest, subject to any liens on existence on the date hereof or incurred with the express
written consent of the Payee, in any Collateral purported to be covered thereby, except as otherwise set forth in Section 9(c)
below;


 


(vi)        the
Company fails to perform or observe in any material way any warranty or agreement made by Company in this Note (except as set forth
in (v) above) and, as to any breach that is capable of cure, Company fails to cure such breach within 15 days of the Company becoming
aware of the occurrence of such breach; and


 


(vii)       the
Company defaults or has an event of default under any of the outstanding senior secured convertible debentures of the Company or
the related securities purchase agreements (collectively, the “First Lien Debt”) between the Company
and Vicis Capital Master Fund (“Vicis”), or with respect to any other current or future indebtedness
of the Company for borrowed money.


 


(b)          Upon the
occurrence of a Payment Default, or upon the occurrence of any other Event of Default hereunder that is not cured within 30 days
of such occurrence (which such cure may include the payment of all amounts owing to Payee hereunder):


 


(i)          all outstanding
principal, accrued interest and other amounts owing hereunder shall, at the option of the Payee, and, in the case of an Event of
Default pursuant to Section 4(a)(ii) or (iii) above, automatically, be immediately due, payable and collectible by the Payee pursuant
to applicable law; and


 


(ii)         if such
default is a Payment Default, the Company shall, upon the written request of the Payee, submit a withdrawal request under any then-existing
letters of credit or other loan agreements, in an amount sufficient to pay all amounts due and payable to the Payee; and


 


(c)          Upon the
occurrence and during the continuance of any Event of Default, interest shall continue to accrue at the rate of ten percent (10%)
per annum.


 


(d)          In the event
of any Event of Default hereunder, the Company shall pay all reasonable attorneys’ fees and court costs incurred by the Payee
in enforcing and collecting this Note.


 


(e)          The Payee’s
rights and remedies under this Note shall be cumulative. The Payee shall have all other rights and remedies not inconsistent herewith
as provided under the Uniform Commercial Code, by law or in equity. No exercise by the Payee of one right or remedy shall be deemed
an election, and no waiver by the Payee of any event of Default shall be deemed a continuing waiver.


 




    	 



    	 



    

  


9.          Security Interest.



 


(a)          Grant of Security
Interest. As collateral security for the full, prompt, complete and final payment and performance when due (whether at stated
maturity, by acceleration or otherwise) of all of the Company’s obligations hereunder (the “Secured Obligations”)
and in order to induce the Payee to provide a loan to the Company, the Company hereby grants to the Payee, along with all other
lenders under the Notes, a second priority security interest, junior in priority only to the first priority security interest granted
to Vicis in connection with the First Lien Debt, in the following assets and interests (all of which being collectively referred
to herein as the “Collateral”):


 


(1)          all real
property of the Company, in the form of a second priority secured mortgage, including but not limited to that certain real property
described as Lot 12, Block 3 of Sunshine State Industrial Park, Section One, according to the Plat thereof, recorded in Plat Book
76, Page 75, of the Public Record of Miami-Dade County, Florida, Parcel Identification Number: 3421140070300; and


 


(2)          any and
all cash proceeds and/or noncash proceeds of any of the foregoing, including, without limitation, insurance proceeds, and all supporting
obligations and the security therefor or for any right to payment;


 


(b)          Perfection.
The Company hereby authorizes Payee to file any mortgage deed, financing statement or continuation statement (including “in
lieu” continuation statements) to perfect the security interest of Payee in the Collateral without the signature of the Company.


 


(c)          Continuing
Security Interests; Termination of Security Interests. This Note has created and shall create a continuing security interest
in all of the Collateral and shall remain in full force and effect until the date (herein called the “Termination Date”)
on which all amounts owing hereunder are paid in full. On the Termination Date, this Note and the security interests granted hereby
by the Company shall automatically terminate and all rights to the Collateral shall revert to the Company, subject to the rights
of Vicis under the First Lien Debt. Upon such termination of the security interests granted hereby, Payee will, at the sole expense
of the Company, promptly (i) deliver to the Company all certificates, instruments and other documents representing or evidencing
any Collateral, together with all (if any) other Collateral, then held by Payee hereunder, and (ii) execute and deliver to the
Company such instruments and other assurances as the Company shall reasonably request to evidence such termination, including properly
completed UCC-3 Financing Statements. Notwithstanding the foregoing, in the event that the Company undertakes a Qualified Financing
through the issuance of debt securities (“Permitted New Indebtedness”), the security interests of Payee
may be subordinated to the Permitted New Indebtedness on a dollar-for-dollar basis. No new secured indebtedness of the Company
senior to or pari passu with this Note, other than Permitted New Indebtedness, may be incurred without the prior written
consent of Payee.


 


(d)          Remedies.
Subject to the rights of Vicis under the First Lien Debt, if any Event of Default is continuing, Payee may exercise with respect
to all or any of the Collateral, in addition to all other rights and remedies provided for herein or otherwise available to it,
all of the rights and remedies of Payee upon default under the Uniform Commercial Code and other applicable law.


 




    	 



    	 



    

  


(e)          Further Assurances.
At any time and from time to time, upon the written request of the Payee, and at the sole expense of the Company, the Company shall
promptly and duly execute and deliver any and all such further instruments and documents and take such further action as the Payee
may reasonably deem necessary or desirable to perfect and continue perfected or better perfect the Payee’s security interest
in the Collateral.


 


10.        Transfer.
This Note may not be transferred without the written consent of the Company and the Payee.


 


11.        Amendment.
This Note may be amended only by a written agreement executed by the Company and Payee.


 


12.        Governing
Law and Venue. This Note shall be governed by, and construed and enforced in accordance with, the laws of the State of Florida,
excluding conflict of laws principles that would cause the application of laws of any other jurisdiction. Any legal action or other
legal proceeding relating to this Note or the enforcement of any provision of this Note may be brought or otherwise commenced in
any state or federal court located in the County of Denver, Colorado.


 


13.        Usury.
All agreements between the Company and Payee, whether now existing or hereafter arising and whether written or oral, are expressly
limited so that in no contingency or event whatsoever, whether by acceleration of the maturity of this Note or otherwise, shall
the amount paid, or agreed to be paid, to the Payee for the use, forbearance or detention of the money to be loaned hereunder or
otherwise, exceed the maximum amount permissible under applicable law.


 


14.        Miscellaneous.
No delay on the part of Payee in exercising any right hereunder shall operate as a waiver of such right under this Note. If any
payment of principal or interest on this Note shall become due on a Saturday, Sunday, or a public holiday under the laws of the
State of Florida, such payment shall be made on the next succeeding business day and such extension of time shall be included in
computing interest in connection with such payment. Upon payment in full of all aggregate unpaid principal and interest payable
hereunder, this Note shall be surrendered to the Company for cancellation.


 




    	 



    	 



    

  


In
Witness Whereof, the Company has caused this Note to be duly executed and delivered as of the day and year first written
above.


 


	 	Net Talk.com, Inc.
	 	 
	 	By: 	/s/Anastasios Kyriakides
	 	Name: ANASTASIOS KYRIAKIDES
	 	Title: CEO


 




    	 



    	 



    

  


EXHIBIT A


 


Increases in Principal Amount


 


	Additional Cash Disbursement	 	Date