**Exhibit 10.56**LOAN AGREEMENT****	THIS LOAN AGREEMENT ("Agreement")is made by and among **GSI VENTURES, LLC**, an Ohio limited liability company("Lender"), **POPMAIL.COM, INC.,**a Minnesota corporation(the "Borrower"), **SDK INVESTMENTS, INC.**, an Ohiocorporation ("SDKI"), POPMAIL NETWORKS, INC., a Texascorporation ("PNI"), FAN ASYLUM, INC., a California corporation("FAI") and CAFÉ ODYSSEY, LLC, a Minnesota limited liabilitycompany ("COL") this 1st day of December, 2000.
**RECITALS**
	A.	Lender has agreed to loan Borrower up to theprincipal amount of $1,200,000 and at Lender's option, in its sole and absolutediscretion, an additional principal amount of $2,800,000.

	B.	Borrower has agreed to borrow up to $1,200,000from Lender and the additional $2,800,000 from Lender, to the extent that Lendermakes that amount available to Borrower.  

	C.	SDKI has acted as a finder in connection with theloan to be made by Lender to Borrower and, as a result, Borrower has agreed topay SDKI a finder's fee consisting of cash and warrants to purchase Borrower'scommon stock.  

	D.	PNI, FAI and COL are wholly owned subsidiaries ofBorrower and will materially benefit from the loan Borrower will receive fromLender.

	E.	As a condition to Lender making a loan to Borrower,Lender requires PNI, FAI and COL to execute this Agreement and be bound bycertain terms of this Agreement.
**	IN CONSIDERATION of the premises, the mutualcovenants and agreements contained herein and other good and valuableconsideration, the receipt, sufficiency and adequacy of which are herebyacknowledged, Lender, Borrower PNI, FAI, COL, and SDKI hereby covenant and agreeas follows:  
**ARTICLE I

THE LOAN

Agreement to Borrow and Lend
.
Subjectto all of the terms, provisions, conditions, covenants and agreements containedin this Agreement, Lender agrees to make a loan to Borrower (the"
Loan
") in the principal amount of at least Four HundredThousand Dollars ($400,000) and for a period of 270 days from the date hereof,at Lender's option and in its sole and absolute discretion, an additionalprincipal amount of Three Million Eight Hundred Thousand Dollars ($3,600,000)(collectively, the "
Loan Proceeds
"), which shall be used inaccordance with the terms set forth herein.  Subject to all of the terms,provisions, conditions, covenants and agreements contained in this Agreement,Borrower agrees to borrow from Lender Loan Proceeds that Lender offers toBorrower within 270 days from the date hereof.

Closing
.  The Loan Proceeds shall be distributedin increments as determined by the Lender, in its sole and absolute discretionof at least $100,000, at one or more closings (each a"
Closing
"), the first of which shall occur on November 30,2000, or on such other date as the parties shall agree (the "
InitialClosing
").   

**Convertible Promissory Notes
.  The Loan will beevidenced by a series of convertible promissory notes (the"
Notes
", or singularly a "
Note"
) in the formattached hereto as 
Exhibit A
 that will be executed by Borrower anddelivered to Lender.  

Interest
.  The outstanding principal balance ofthe Notes shall bear interest at a rate of Twelve Percent (12%) per annum as setforth in the Notes. 

Payment Terms
.
Accrued interest under theNotes shall be due and payable in quarterly installments on February 1, 2001,May 1, 2001, August 1, 2001 and November 1, 2001 and the entire outstandingprincipal balance of the Loan, together with all accrued but unpaid interestthereon, shall be due and payable in full on January 5, 2002 (the"
Maturity Date
"). Notwithstanding anything to the contrarycontained herein, upon Lender's consent, which shall be made in its sole andabsolute discretion, Borrower may pay any portion of the quarterly installmentsof accrued interest of the Loan with shares of Borrower's common stock, parvalue $.01 per share (the "
Common Stock
").  The value of theCommon Stock used to pay any quarterly installments of accrued interest shall bedetermined by the closing sale price of the Common Stock as reported by Nasdaqon the preceding trading day before the quarterly installment is paid.

Conversion Right
.  The Lender shall have the rightto convert all or any portion of the debt evidenced by the Notes into Borrower'sCommon Stock in accordance with the terms of the Notes.

**ARTICLE II

WARRANTS TO PURCHASE COMMON STOCK**
	2.1.	Warrant to Purchase Common Stock toLender.****The Borrower hereby agrees to issue to Lender as a part ofthe consideration for Lender making the Loan to Borrower, a warrant to purchasethe number of shares of Common Stock equal to fifty percent (50%) of theaggregate face value of each Note and in the form attached hereto as ExhibitB (the "Lender Warrant"). 
**Warrant to Purchase Common Stock to SDKI
.
As partial consideration for introducing the Borrower to the Lender, theBorrower hereby agrees to issue to SDKI a warrant to purchase the number ofshares of Common Stock equal to ten percent (10%) of the aggregate face value ofeach Note and in the form attached hereto as 
Exhibit C
 ("
SDKIWarrant
" and together with the Lender Warrant, the"
Warrants
").  

Share Calculation For Warrants; Strike Price;Issuance
.  For purposes only of determining the number of shares which shallbe granted upon exercise of the Warrants, the Common Stock shall be deemed tohave a value of $1.00 per share.  The strike price for each Lender Warrant shallbe 120% of the Market Price (as that term is defined in the Notes), and thestrike price for each SDKI Warrant shall be the Market Price.  The Borrowershall issue each Warrant at the Initial Closing and each subsequent Closing.The Warrants shall be exercisable for a period of at least fiveyears.

**ARTICLE III

BORROWER'S REPRESENTATIONS AND WARRANTIES****	The Borrower hereby represents and warrants toLender that the following are true and correct as of the date hereof and shallbe true and correct as of the date of the Initial Closing and any subsequentClosing and shall remain true and correct during the term of all of the LoanDocuments (as defined below):  

3.1	Borrower and each of its subsidiaries and affiliates(a) is a duly organized and validly existing corporation in good standing underthe laws of the jurisdiction of its formation, (b) has the power and authorityand the legal right to own its property and assets and to transact the businessin which it is engaged and (c) is duly qualified as a foreign corporation  orotherwise licensed and authorized to transact business and in good standing ineach jurisdiction where the ownership, leasing or operation of property or theconduct of its business requires such qualification and where the failure to beso qualified, licensed or authorized would have a material adverse effect on thecondition (financial or otherwise), prospects, assets or properties of Borrower,any subsidiary or affiliate. All subsidiaries and affiliates of the Borrower arelisted on Item 3.1 of the Disclosure Schedule.  The term"affiliate" shall have the meaning ascribed thereto under Rule 12b-2promulgated under the Exchange Act of 1934, as amended.

3.2  The execution, delivery and performance of this Agreement, the Notes andthe Warrants and any and all other security agreements, pledge agreements,financing statements, certificates or instruments contemplated herein(collectively "Loan Documents") executed and delivered by theBorrower or its affiliates have been authorized by all necessary corporateactions and do not and will not contravene any legal or contractual restrictionbinding on the Borrower or any of its property or its assets.

3.3  The Borrower and each of its subsidiaries and affiliates has the powerto take all actions contemplated hereby (including but not limited to theissuance of the Warrants and Notes, the right of first refusal granted to Lenderto participate in any security issuances and the granting of the securityinterests in the Collateral (as defined below)) to execute, deliver and carryout the terms and provisions of each Loan Document to which it is a party andhas taken all necessary actions to authorize the execution, delivery andperformance by it of each Loan Document to which it is a party and all actscontemplated hereby. The Loan Documents when executed and delivered by theBorrower and its subsidiaries and affiliates will constitute the legal, validand binding obligation of the Borrower and its subsidiaries and affiliates (asthe case may be) and is, or will be upon execution, enforceable against theBorrower and its subsidiaries and affiliates (as the case may be) in accordancewith their respective terms, except to the extent that enforcement may belimited by applicable bankruptcy, insolvency, reorganization or other similarlaws affecting creditors rights generally.  

3.4  The execution, delivery or performance by the Borrower and itssubsidiaries and affiliates of each Loan Document, and compliance by theBorrower and its subsidiaries and affiliates with the terms and provisionshereof and thereof, (a) do not contravene any provision of any law, statute,rule or regulation or any order, writ, injunction or decree of any court orgovernmental instrumentality applicable to the Borrower, any subsidiary oraffiliate, (b) do not conflict with or result in any breach of any of the terms,covenants, conditions or provisions of, or constitute a default under, or resultin the creation or imposition of (or the obligation to create or impose) anylien (other than as contemplated by the Loan Documents) upon any of the propertyor assets of the Borrower, any subsidiary or affiliate pursuant to the terms ofany material indenture, mortgage, deed of trust, credit agreement, loanagreement or other agreement, contract or instrument to which the Borrower, anysubsidiary or affiliate is a party or by which the Borrower, any subsidiary oraffiliate or any of their respective properties or assets is bound or to whichthe Borrower, any subsidiary or affiliate may be subject and (c) do no violateany provision of the Certificate of Incorporation, Articles of Organization,operating agreement, bylaws or regulations of the Borrower, any subsidiary andaffiliate. 

3.5  The authorization, issuance, sale and delivery of the shares of CommonStock issuable upon conversion of the Notes and upon exercise of the Warrantshas been duly authorized by all requisite corporate action on the part of theBorrower.  The shares of the Common Stock issuable upon conversion of the Notesand upon exercise of the Warrants upon their issuance in accordance with theNotes and the Warrants, respectively, will be validly issued, fully paid andnonassessable.  Any shares of Common Stock issued in accordance with the termsof the Notes for payment of quarterly installments of acquired interest will bevalidly issued, fully paid and nonassessable.

3.6  Except as disclosed in Schedule 3.6, there are no actions, suits orproceedings pending or, to the  knowledge of the Borrower, threatened againstBorrower, any subsidiary  or affiliate  (a) with respect to the Loan Documents,any of the Collateral (as defined below) or the transactions contemplated herebyor (b) that are, either individually or in the aggregate, reasonably likely tohave a material adverse effect on the condition (financial or otherwise),prospects, assets or properties of Borrower, any subsidiary or affiliate.

3.7  All balance sheets, income statements, financial statements, operatingstatements and other financial data pertaining to Borrower or its subsidiariesor affiliates (the "Financial Information") that have beendelivered (or will be delivered) to Lender by or on behalf of Borrower are orwill be accurate and complete in all material respects, are or will be inaccordance with the books and records of Borrower and its subsidiaries andaffiliates, and accurately present or will present the financial condition,results of operations and changes in financial position of the person or entityto which they pertain as of their respective dates and there has been nomaterial change with respect thereto.  All Financial Information delivered toLender is and shall be prepared in accordance with the generally acceptedaccounting principles, consistently applied.

3.8  None of the Borrower's reports and documents heretofore filed with theSecurities and Exchange Commission pursuant to the Securities Act of 1933, asamended, and the Securities Exchange Act of 1934, as amended, contained at thetime they were filed  any untrue statement of a material fact or omitted tostate any material fact required to be stated therein or necessary to make thestatements made therein, in light of the circumstances under which they weremade, not misleading.

3.9  The Borrower and its subsidiaries and affiliates own andpossess adequate and enforceable rights to use all patents, patent applications,trademarks, trademark applications, trade names, service marks, logos,copyrights, copyright applications, licenses, inventions, software, programs,know-how (including trade secrets and other unpatented and/or unpatentableproprietary or confidential information, systems or procedures) and othersimilar rights and proprietary knowledge (collectively,"Intangibles") necessary for the conduct of their respectivebusinesses.  Borrower and its subsidiaries and affiliates have the unrestrictedright to use all of the Intangibles.  Borrower and its subsidiaries andaffiliates are not infringing upon or in conflict with any right of any otherperson or entity with respect to any Intangibles and the Borrower and itssubsidiaries and affiliates are not subject to any outstanding order, decree,judgment or stipulation with respect to the Intangibles.  No proceedings havebeen instituted or are pending or, to Borrower's knowledge, threatened whichchallenge the validity or rights of Borrower or its subsidiaries and affiliatesto any of the Intangibles, and Borrower has no knowledge of any infringement byothers of any of the Intangibles.  All of the Intangibles are valid, enforceableand free and clear of any attachments or liens and all claims, restrictions anddemands of any other person, firm or corporation, including attorneys' fees forpast services, expenses and government fees.  None of the past or presentemployees, officers, directors, or shareholders of Borrower, any subsidiary oraffiliate has any rights in any Intangibles.  Borrower and its subsidiaries andaffiliates have not granted any outstanding license or other rights to any ofthe Intangibles, except those licenses granted in the ordinary course ofbusiness, and are not liable, and have not made any contract or arrangementwhereby they may become liable, to any person for any royalty or othercompensation for the use of any Intangibles.  The trade secrets and processesand procedures of Borrower and its subsidiaries and affiliates which arenecessary to the operation of Borrower and its subsidiaries and affiliates havebeen reduced to writing, to the extent practical, and will remain available foruse by Borrower and its subsidiaries and affiliates after the date of theInitial Closing and any subsequent Closing. 

3.10	All factual information heretofore orcontemporaneously furnished by the Borrower, any subsidiary or affiliate toLender (including, without limitation, all information contained in thisAgreement) for purposes of this Agreement or any transaction contemplated herebyor thereby is, and all other such factual information hereafter furnished by theBorrower, any subsidiary or affiliate to Lender for purposes of this Agreementor any transaction contemplated herein will be, true and accurate in allmaterial respects on the date as of which such information is given and theBorrower in good faith believes such information is not incomplete by omittingto state any fact necessary to make such information not misleading at such timein light of the circumstances under which such information was provided.

	3.11  The Borrower, each subsidiary and affiliate has filed all taxreturns required to be filed by it and has paid all income and franchise taxespayable by it which have become due pursuant to such tax returns and all othertaxes and assessments payable by it which have become due, other than those notyet delinquent and except for those contested in good faith and by appropriateproceedings. The amounts shown on those tax returns fairly present the taxposition of the Borrower and such subsidiaries and the Borrower does not expectany material adjustments or any amounts shown on such tax returns. Each of theBorrower and each subsidiary or affiliate has paid, or has provided adequatereserves (in the good faith judgment of the management of the Borrower) for thepayment of, all foreign, federal and state income and franchise taxes applicablefor all prior fiscal years of the Borrower and for the current fiscal year tothe date hereof. As of the date hereof, no tax lien has been filed, and, to theknowledge of the Borrower, no claim is being asserted, with respect to any tax,fee or other charge.

	3.12  All employee benefit plans, as defined in Section 3(3) of ERISA(defined below) and which are maintained for employees by the Borrower, asubsidiary or an ERISA Affiliate (defined below) ("Plan"), comply withall relevant provisions of the Internal Revenue Code of 1986 (the"Code") and ERISA; no Plan is insolvent or in reorganization; no Planhas an accumulated or waived funding deficiency or has applied for an extensionof any amortization period within the meaning of Section 412 of the Code;neither the Borrower nor any subsidiary nor any ERISA Affiliate has incurred anyliability to or on account of a Plan which is a single-employer plan as definedin Section 4001 (a) (15) of ERISA pursuant to Section 4062, 4063, 4064 or amulti employer plan pursuant to Sections 515, 4201 or 4204, of ERISA; noproceedings have been instituted to terminate any plan; and no condition existswhich constitutes a prohibited transaction (as defined in Section 406 of ERISAor Section 4975 of the Code) or a reportable event (as defined in Section 4043of ERISA), or which is reasonably expected will result in the Borrower, anysubsidiary or an ERISA Affiliate of incurring a liability to or on account of aPlan pursuant to any of the foregoing Sections of ERISA or the Code.  As of thedate of this Agreement, the aggregate present value of all accrued benefitliabilities (as defined in Section 4001(a)(6) of ERISA) of all Plans which weresingle-employer plans did not exceed the aggregate current value of all assetsof such Plans based upon estimated actuarial data that has been provided to theBorrower by the consulting actuaries of the Plans, and as of the date of thisAgreement, there was no withdrawal liability (and would be no withdrawalliability assuming a complete withdrawal from all such Plans) to any Plan whichis a multi employer plan.

	"ERISA" means the Employee Retirement IncomeSecurity Act of 1974, as amended, and any successor statute of similar import,together with regulations thereunder, in each case as in effect from time totime. References to sections of ERISA also refer to any successor sections.

	"ERISA Affiliate" means any person (as definedin Section 3 (9) of ERISA) (including each trade or business (whether or notincorporated)) which together with the Company or any Subsidiary would be deemedto be a "single employer" or a member of the same "controlledgroup" of "contributing sponsors" within the meaning of Section4001 of ERISA

	3.13  The Borrower and its subsidiaries and affiliatesare in compliance with all applicable statutes, regulations and orders of, andall applicable restrictions imposed by, all governmental bodies, domestic orforeign, in respect of the conduct of their businesses and the ownership oftheir properties, except such noncompliance as would not, in the aggregate,reasonably be expected to have a material adverse effect on the condition(financial or otherwise), prospects,  assets or properties of Borrower or anysubsidiary or affiliate.

3.14  The Borrower and its subsidiaries and affiliates havenever conducted business under any names other than those set forth in Item3.14 of the Disclosure Schedule. The addresses of all offices where any ofthe Collateral is located is listed in Item 3.14 of the DisclosureSchedule.  The chief executive office and the chief place of business for theBorrower, each of its subsidiaries, and affiliates and the office where eachthereof keeps its books and records, is located at the address specified inItem 3.14 of the Disclosure Schedule.

	3.15    As of the date the last Financial Information wasreceived by Lender from Borrower, except to the extent disclosed, reflected orreserved against therein or in Item 3.15 of the Disclosure Schedule,Borrower did not have any material liabilities or obligations, known or unknown,secured or unsecured, whether accrued, absolute, contingent or otherwise. 

	3.16  Since the date the last Financial Information wasreceived by Lender from Borrower, there has been no material adverse change inor to the business of Borrower or its subsidiaries or affiliates, or to theoperations, earnings, prospects, liabilities or relationships with suppliers,distributors or customers of Borrower or its subsidiaries or affiliates.  Thereis no presently existing condition with respect to Borrower or its subsidiariesor affiliates which might be expected to have a material adverse effect on thebusiness or prospects of Borrower or its subsidiaries or affiliates or thecontinued conduct of the business of Borrower or its subsidiaries or Affiliatesafter the date of the Initial Closing or any subsequent Closing. 

	3.17  No order, consent, approval, license, authorizationor validation of, or filing, recording or registration with, or exemption by, orother act by (except as have been obtained or made), any governmental or publicbody or authority, or any subdivision thereof, is required to authorize, or isrequired in connection with, (a) the execution, delivery and performance by theBorrower or its subsidiaries or affiliates of any Loan Document or (b) thelegality, validity, binding effect or enforceability against the Borrower or itssubsidiaries or affiliates of any Loan Document.

3.18  Borrower shall use the Loan Proceeds exclusively for commercial reasonsthat are expressly approved by Lender in accordance with Section 4.2 below.

3.19    Borrower or its subsidiaries and affiliates (as the case may be) arethe legal and beneficial owner of the Collateral, and the Collateral is free andclear of all mortgages, security interests, liens, equities, encumbrances andclaims of every kind (collectively, the "Encumbrances") exceptfor the Encumbrances set forth on Item 4.7 of the Disclosure Schedule andthe liens of the Lender as set forth in this Agreement.  The Collateral is andwill remain free and clear of all Encumbrances of any nature whatsoever, exceptfor those set forth on Item 4.7 of the Disclosure Schedule and the liensof the Lender as set forth in this Agreement.
All of the subsidiaries and affiliates of Borrower are wholly owned byBorrower.

3.21  The security interest and leasehold mortgage in favor of the Borroweron the real and personal property located at Kenwood Mall, Cincinnati, Ohio, isa first and best lien on such personal property and leasehold and Borrower hasnot and will not allow any Encumbrances on such property to be superior toBorrower's mortgage and security interest.
**ARTICLE IV

ADDITIONAL COVENANTS AND OTHER AGREEMENTS****	4.1.	Finder's Fee. Borrower shall pay toSDKI a cash fee of ten percent (10%) of all the Loan Proceeds disbursed toBorrower, which amount shall be paid from the proceeds disbursed toBorrower.

Disbursement Approval
.  All disbursements of LoanProceeds shall be approved in writing in advance by Lender, in its sole andabsolute discretion.  Prior to any use by the Borrower of the Loan Proceeds, orany portion thereof, Borrower shall have received Lender's prior writtenapproval of such use, with such approval being determined by Lender in its soleand absolute discretion.  Notwithstanding the foregoing provisions of thisSection 4.2, Borrower shall not need any approval from Lender with respect toits use of the first $50,000 of Loan Proceeds received by Borrower.

Registration Rights
.  Within 60 days of the datehereof, Borrower shall have used its best efforts to cause a registrationstatement covering the resale of the shares of Common Stock issuable uponconversion of the Notes, exercise of the purchase rights under the Notes, usedfor payment of the accrued interest on the Notes and  exercise of the Warrantsto have been declared effective by the Securities and Exchange Commission.  Allexpenses of such registration, except fees for underwriting discounts andselling commissions applicable to the resale of such Common Stock by Lender orthe holder of the Warrants, shall be borne by Borrower.  Lender and SDKI (andtheir respective assigns) each agree to cooperate with the Borrower in thepreparation and filing of any such registration statement and in the furnishingof information for inclusion therein, or in any efforts by the Borrower toestablish that the proposed sale is exempt under the Securities Act of 1933, asamended, as to any proposed distribution.

4.4	Right of First Refusal.  As long as theirexists any principal or interest outstanding under the Notes, the Borrowergrants to the Lender a right of first refusal to participate as an investor inany offering of Borrower's Common Stock, securities convertible into CommonStock or any other equity securities of the Borrower (collectively, the"Securities"). If the Borrower receives an executed letter ofintent or term sheet from any third party with respect to a sale or transfer ofSecurities that the Borrower is willing to accept, the Borrower shall promptlygive written notice thereof to the Lender, including all essential terms andconditions of such proposed offering.  The Lender shall then have ten (10) daysafter receipt of such written notice to elect to enter into an agreement withthe Borrower to participate in the proposed offering on the same terms andconditions as set forth in the Borrower's written notice.  If the Lenderdeclines to exercise its right of first refusal upon written notice from theBorrower or fails to notify the Borrower within a 10-day period of an electionto invoke its right of first refusal, the Borrower shall have a period of 30days to enter into an agreement with such third party from whom it has receivedan executed letter of intent for the sale or transfer of the Securities on theexact terms and conditions that were provided to Borrower in the notice.  In theevent that Borrower does not effect a transfer or sale of the Securities withinthe specified thirty-day period, the Lender's right of first refusal shallcontinue to be applicable to any subsequent sale or transfer of the Securitiesby the Borrower. 

4.5.	Approval of Equity and Debt Issuances.Borrower and its subsidiaries and affiliates shall not issue any securities,including options to purchase  securities, or take on any debt (other than thedebt reflected by the Notes and trade payables incurred in the ordinary courseof business), without Lender's prior written approval, which approval shall begiven in Lender's sole and absolute discretion. 

4.6 	Board Seats.  Upon Lender's request, the Boardof Directors of Borrower (the "Board") shall take all necessaryand appropriate action to create up to two (2) new director seats of the Boardand appoint such persons as designated by Lender.  Additionally, for each$1,400,000 of principal amount of Notes purchased by Lender in excess of$1,200,000, Lender may, at its election, designate one (1) additional member ofthe Board and the Board shall take all necessary and appropriate action tocreate such director seats and appoint such persons designated by Lender;provided, however, that Lender's election to designate such new members must bemade, if at all, within 30 days of the closing of the purchase of suchadditional principal amounts of Notes.

4.7 	Security Agreements.  In connection with theLoan made pursuant to this Agreement, the Notes shall be secured by a first andbest lien in all of the assets of the Borrower and its subsidiaries andaffiliates, including the shares of capital stock and membership interest inPopmail Network, Inc., Fan Asylum, Inc. and Café Odyssey, LLC(collectively, the "Collateral"); except for the Collateral set forthin Item 4.7 of the Disclosure Schedule, which Lender shall have a lienand security interest in, which shall be subordinated only to those persons orentities identified in Item 4.7 of the Disclosure Schedule.  Borrower andits subsidiaries and affiliates shall execute and deliver security agreements,financing statements, pledge agreements and all other instruments and agreementsrequired by Lender that provide for a grant by Borrower and its subsidiaries andaffiliates to Lender of a security interest in all of the Collateral.   Borrowershall take all other steps  necessary to keep such security interest in Lenderperfected and shall take no action to subordinate Lender's security interest toany other person or entity without Lender's prior written approval.

4.8 	Default Under Loan Document.  In the eventthat a default shall exist under any of the Loan Documents, Lender shall beauthorized to proceed with any and all remedies available to Lender thereunder.A default under any of the Loan Documents shall constitute a default under eachother Loan Document and shall entitle Lender to pursue any and all remediesunder each or any of the Loan Documents.

Reserving Common Stock For Issuance
.  The Borrowershall at all times while the Warrants or the Lender's conversion and purchaserights as set forth in the Notes are outstanding, reserve and keep available outof its authorized but unissued stock, such number of duly authorized CommonStock as shall be sufficient to effect the conversion rights and purchase rightsunder the Notes and Warrants in accordance with their respectiveterms.	

Reclassification of Common Stock
.  The Borrowercovenants and agrees that in the event its present Common Stock shall bereclassified, split, combined or otherwise changed, or in case of anyconsolidation or merger of the Borrower with or into another corporation as aresult of which holders of Common Stock become entitled to receive securities orother assets (including cash) with respect to or in exchange for their CommonStock (other than a merger with a subsidiary in which merger the Borrower is thecontinuing corporation and which does not result in any reclassification,capital reorganization or other change of outstanding shares of Common Stock) orin case of any sale, lease or conveyance to another corporation of the propertyof the Borrower as an entirety or substantially as an entirety, the Borrowershall make proper provision as a part of the terms of such reclassification,split, combination, change, consolidation, merger or sale, that the holder ofthe Warrants and the Notes will thereafter be entitled to convert it into thesame kind and amount of securities (including in that term, stock of any classor classes) and other assets as may be issuable or distributable by the terms ofsuch reclassification, split, combination, change, consolidation, merger orsale.

	4.11  	Financial Statements. The Borrowershall: (i) Within 45 days of the end of each quarter, furnish Lender with anyand all filings with the Securities and Exchange Commission including but notlimited to Form 10Q, and  a No Default Certificate in the form which in a formacceptable to Lender; (ii) within 90 days of its fiscal year end, furnishaudited copies of the Borrower's balance sheet, income statement, and statementof cash flows as well as a copy of Borrower's Form 10K; and (iii) within 30 daysof filing, the Borrower's consolidated federal income tax return.

	4.12	Taxes, Assessments and Liabilities. TheBorrower shall pay all taxes, assessments, and other liabilities when due,except for those which are contested in good faith. File all required federal,state and local tax returns on a timely basis.

	4.13	Notice.  The Borrower shall give theLender prompt notice of any: (i) default of this or any other agreement orcontract under which the Borrower or any of its subsidiaries or affiliates areliable; (ii) environmental penalty, claim or dispute involving more than$25,000.00; (iii) litigation, government proceeding or investigation filed orthreatened against Borrower or any of its subsidiaries or affiliates, Lender itsdirectors and officers involving more than $25,000.00; (iv) reportable eventunder ERISA; or (v) material change in the business prospects or financialcondition of the Borrower or any of its subsidiaries or affiliates.

	4.14	Corporate Existence and Status.  Borrowershall maintain its and its subsidiaries' and affiliates' corporate existence andremain in good standing under the laws of each jurisdiction where the Borrowerand its subsidiaries or affiliates are duly qualified to conduct itsbusiness.

	4.15	Protection of Intellectual Property.Borrower and its subsidiaries and affiliates shall take all measures necessaryto defend and protect the Intangibles, and not commit or permit any action thatmay impair the value of the Intangibles.

	4.16	Liens.   Borrower and its subsidiaries andaffiliates shall not create or permit to exist any Encumbrance with respect tothe Collateral, except for liens created in favor of the Lender hereunder.

	4.17	Compliance with Laws.  Borrower and itssubsidiaries and affiliates shall keep, observe, satisfy and not sufferviolations of any and all  laws, statutes, ordinances and/or regulations.	

	

	4.18	Operate in the Ordinary Course.  Borrowerand its subsidiaries and affiliates shall continue to operate their respectivebusinesses in the ordinary and customary course, and not take any actions whichmaterially alter the nature or scope of their respective businesses as conductedon the date of the Initial Closing.

	4.19	Further Assurances.  Borrower and itssubsidiaries and affiliates shall provide Lender with such additionalinformation or documentation as Lender may request from time to time.

	4.20	Lender's Attorney's Fees.  At eachclosing, Borrower shall pay Lender's attorney's fees it has incurred related tothe Loan up to a maximum of $10,000.
**ARTICLE V

DEFAULT AND REMEDIES****	5.1.	Events of Default.  The occurrenceof any one or more of the following events or the existence of one or more ofthe following conditions shall, upon 30 days written notice to Borrower,constitute an "Event of Default" under this Agreement providedthat the events set forth in Sections 5.1(a), 5.1(c), 5.1(f), 5.1(e), 5.1(g),5.1(h), 5.1(k), 5.1(l) and 5.1(n) shall constitute an Event of Defaultimmediately upon their occurrence and Lender shall not be required to providethe 30 days' written notice for any such events:  
**		(a)	Borrower shall fail to pay when due anyinstallment of principal or interest due under the Notes, whether due on thedate provided for therein or by acceleration or otherwise, or Borrower shallfail to pay when due any other amounts due under any of the Loan Documents;
Any material breach of a representation or warranty madein writing to Lender by Borrower or its subsidiaries or affiliates made herein,in any Loan Documents or in connection with the making of the Loan; 

The breach, default or violation by Borrower or itssubsidiaries or affiliates of any obligation, agreement or covenant contained inLoan Documents or any other agreements, certificates or writings executed inconnection herewith by Borrower or its subsidiaries or affiliates; unless thesame is cued within any applicable grace period; 

any material provision of any of the Loan Documents shallat any time for any reason cease to be in full force and effect or shall bedeclared to be null and void; 

any litigation or proceeding is pending which maymaterially adversely affect the ability of Borrower, its subsidiaries oraffiliates to perform its obligations under the Loan Documents; 

 the failure of the Borrower or its subsidiaries oraffiliates to comply with any other covenants or agreements contained in any ofthe Loan Documents and not herein specifically referenced, unless the same iscured within any applicable grace period; 

a material part of the operations of the Borrower or anyof its subsidiaries or affiliates shall cease for a period of thirty days;

the liquidation, termination or dissolution of Borroweror any of its subsidiaries or affiliates;

the occurrence of an event of default (as definedtherein) in any of the Loan Documents other than this Agreement;

the occurrence of any of the following transactionsconcerning the Borrower without the prior written consent of the Lender (whichshall be given in its sole and absolute discretion): (i) the acquisition of theBorrower by another entity by means of any transaction or series of relatedtransactions (including, without limitation, the transfer of more than 50% ofthe voting power of the Borrower, reorganization, merger, consolidation); or(ii) a sale of all or substantially all of the assets of the Borrower; unlessthe Borrower's shareholders of record as constituted immediately prior to suchacquisition or sale will, immediately after such acquisition or sale (by virtueof securities issued as consideration for the Borrower's acquisition orotherwise) hold at least 50% of the voting power of the surviving or acquiringentity;

the issuance of any securities by Borrower's subsidiariesand affiliates without the prior written consent of the Lender; 

the occurrence of any of the following transactionsconcerning the Borrower's subsidiaries or affiliates without the prior writtenconsent of the Lender: (i) the acquisition (in whole or in part) of anysubsidiary or affiliate of the Borrower by another entity or person by means ofany transaction or series of related transactions (including, withoutlimitation, the stock purchase, stock issuance, reorganization, merger,consolidation); or (ii) a sale of all or substantially all of the assets of theBorrower; 

Borrower's Common Stock is de-listed from the NasdaqNational or SmallCap Market Systems; or 

if Lender shall reasonably deem itself to be insecure.

**	5.2.	Remedies.****Upon theoccurrence of any Event of Default hereunder as above provided, and at any timethereafter, all principal, interest and other amounts payable under the Notesshall, at the option of Lender, become immediately due and payable withoutpresentment, demand, protest or other notice of any kind, all of which areexpressly waived by Borrower.  Lender may proceed with every remedy available atlaw or in equity or provided for in the Loan Documents or in any other documentexecuted in connection with the Loan, in such order or sequence as Lender maydetermine in its sole discretion, including concurrently, independently, orsuccessively, and all expenses incurred by Lender in connection with any remedyshall be deemed indebtedness of Borrower to Lender including, but not limitedto, reasonable attorneys' fees incurred by Lender.  
**ARTICLE VI

GENERAL PROVISIONS****	6.1.	Amendments.  No provision or termof the Loan Documents may be amended, modified, revoked, supplemented, waived orotherwise changed except by a written instrument duly executed by the party fromwhom enforcement is sought.  
**	6.2.	Borrower Not Released.  Withoutaffecting any obligation of Borrower under this Agreement, Lender without noticeor demand may renew, extend or otherwise change the terms and conditions of theLoan.  
**	6.3.	Severability.  Whenever possible,each provision of the Loan Documents shall be interpreted so as to be effectiveand valid under Ohio law.  Should any provision, covenant or agreement containedin the Loan Documents be deemed invalid, illegal or unenforceable in anyjurisdiction, the validity, legality and enforceability of the remainingprovisions of the Loan Documents shall not be impaired thereby, nor shall thevalidity, legality or enforceability of any such defective provision be in anyway affected or impaired in any other jurisdiction.  
**	6.4.	Successors and Assigns Bound;Assignment.  The covenants and agreements contained herein shall bind theparties hereto and each of their respective successors and assigns.  Borrowermay not assign this Agreement without the prior written consent of Lender.Subject to the foregoing restriction, this Agreement shall inure to the benefitof Lender and SDKI, their successors and assigns.  
**	6.5.	No Third Party Benefits.  ThisAgreement is made for the sole benefit of Borrower, Lender, PNI, FAO, COL, SDKIand their respective successors and assigns, and no other person or personsshall have any rights or remedies under or by reason of this Agreement.  
**	6.6.	Headings.  The captions andheadings of the paragraphs in the Agreement are for convenience only and are notused to interpret or define the provisions of the Agreement.  
**	6.7.	Governing Law.  This Agreement andthe Loan Documents or any other documents executed in connection with the loanshall be governed by and interpreted in accordance with the laws of the State ofOhio, without regard to Ohio's conflict of laws principles.  
**	6.8.	Conflict.  Should any provision ofany other Loan Documents conflict with any provision of this Agreement, theprovision selected by Lender, in its sole discretion, shall govern and shall becontrolling.  

6.9 	Jurisdiction.  Borrower, by its executionhereof (i) hereby irrevocably submits to the exclusive jurisdiction of the Stateof Ohio and to the exclusive jurisdiction of the United States District Courtfor the Southern District of Ohio for the purpose of any suit, action or otherproceeding arising out of or based upon this Agreement, the Collateral or theLoan Documents or the subject matter hereof or thereof brought by Lender, anyholder of the obligations of Borrower under the Loan Documents or theirrespective successors or assigns, and (ii) agrees not to assert, by way ofmotion, as a defense or otherwise, in any such proceeding, any claim thatBorrower is not subject personally to the jurisdiction of the above-namedcourts, that Borrower's property is exempt or immune from attachment orexecution, that any such proceeding brought in one of the above-named courts isbrought in an inconvenient forum, that the venue of any such proceeding broughtin one of the above-named courts in improper, or that this Agreement, theCollateral or any of the Loan Documents, or the subject matter hereof orthereof, may not be enforced in or by such court.

6.10	Waiver of Jury.  LENDER AND BORROWER HEREBYVOLUNTARILY, KNOWINGLY AND INTENTIONALLY WAIVE ANY AND ALL RIGHTS TO TRIAL BYJURY IN ANY LEGAL ACTION OR PROCEEDING ARISING UNDER THIS AGREEMENT ORCONCERNING THE LOAN DOCUMENTS AND/OR ANY COLLATERAL CONTEMPLATED THEREBY,REGARDLESS OF WHETHER SUCH ACTION OR PROCEEDING CONCERNS ANY CONTRACTUAL ORTORTIOUS OR OTHER CLAIM.  BORROWER ACKNOWLEDGES THAT THIS WAIVER OF JURY TRIALIS A MATERIAL INDUCEMENT TO LENDER IN EXTENDING CREDIT, THAT LENDER WOULD NOTHAVE EXTENDED SUCH CREDIT WITHOUT THIS JURY TRIAL WAIVER, AND THAT BORROWER HASBEEN REPRESENTED BY AN ATTORNEY OR HAS HAD AN OPPORTUNITY TO CONSULT WITH ANATTORNEY IN CONNECTION WITH THIS JURY TRIAL WAIVER AND UNDERSTANDS THE LEGALEFFECT OF THIS WAIVER.

	6.11	Obligations of Subsidiaries of Borrower.PNI, FAI and COL all acknowledge and agree that each of them shall be bound bySection 4.8 and all obligations, covenants, representations and warranties thatreference any subsidiary or affiliate of Borrower as if such obligations,covenants, representations and warranties were fully made by them.  PNI, FAI andCOL further acknowledge and agree that each of them shall receive a materialbenefit from the Loan received by Borrower from Lender because without it, PNI,FAI and COL would no longer be able to continue their business as currentlyoperated.  The obligations of PNI, FAI and COL hereunder were a materialinducement to Lender to enter into this Agreement.

	6.12	Counterparts.  This Agreement may beexecuted in one or more counterparts, each of which shall de deemed to be anoriginal but all of which together will constitute one and the same instrument.This Agreement may be executed by facsimile signatures which shall have the sameforce and effect as original signatures.

	6.13	Entire Agreement.  This Agreement and alldocuments and agreements referred to in this Agreement supersede all priorunderstandings, agreements and discussions between the parties concerning thissubject matter, with such prior understandings, agreements and discussionsbetween the parties being merged into this Agreement, and constitutes the entireagreement between the parties with regard to this subject matter.

	6.14	Survival.  All of the obligations,covenants, representations and warranties of Borrower and its subsidiaries andaffiliates shall survive the Initial Closing and any subsequent Closing.
**ARTICLE VII

CONDITIONS TO SUBSEQUENT CLOSINGS**
7.1	The obligation of Lender to complete any subsequentClosing after the Initial Closing are subject to the satisfaction of each of thefollowing conditions:

		(i)	Receipt of certified resolutions of Borrowerand its subsidiaries and affiliates authorizing the Loan and the grant of thesecurity interest in the Collateral to Lender;

		(ii)	Execution of the Loan Documents by Borrowerand its subsidiaries and affiliates, including any Notes representing theadditional proceeds being disbursed in a subsequent Closing;

		(iii)	No Event of Default exists;

		(iv)	Confirmation from the applicable federal andstate filing offices of Lender's perfected security interest in theCollateral;

		(v)	Receipt of evidence satisfactory to Lender andits legal counsel, in their sole discretion, of Lender's first and best lienposition with respect to the Collateral with the exception of the Collateral setforth in Item 4.7 of the Disclosure Schedule;

		(vi)	Receipt of  Borrower's certified resolutions authorizing theissuance and reservation of shares of Common Stock upon the exercise of theWarrants and the conversion rights set forth in the Notes in a form satisfactoryto Lender;

		(vii)	All representations and warranties set forth in theAgreement or any Loan Document are true and correct as of the date of anysubsequent Closing;

		(viii)	Receipt of a No Default Certificate fromthe Borrower and each subsidiary and affiliate of Borrower in a form acceptableto Lender.

[*Signature Page to Follow*]

 

IN WITNESS WHEREOF, the parties hereto executed this LoanAgreement as of the date first written above.
**BORROWER:

POPMAIL.COM, INC.,**
By:						
Its:___________________________

 
**PMI:

POPMAIL NETWORK, INC.**
By:						
Its:___________________________

 
**LENDER:

GSI VENTURES, LLC,**
By: SDK INVESTMENTS, INC., Manager

By:___________________________________

Stephen D. King

President
**FAI:

FAN ASYLUM, INC.**
By:						
Its:___________________________
**SDKI:

SDK INVESTMENTS, INC., 

By:						
Stephen D. King

President
**COL:

CAFE ODYSSEY, LLC**
By:						
Its:___________________________
**						

						

DISCLOSURE SCHEDULE**
ITEM 3.1	SUBSIDIARIES AND AFFILIATES

ITEM 3.6	LITIGATION

ITEM 3.14 	NAMES OF BUSINESSES; ADDRESSES WHERE COLLATERAL LOCATED;PRINCIPAL OFFICE ADDRESS OF BORROWER, SUBSIDIARIES AND AFFILIATES

ITEM 3.15	CONTINGENT LIABILITIES

ITEM 4.7	ENCUMBRANCES ON COLLATERAL

 

 

113679.5
**SCHEDULE 3.1

Subsidiaries and Affiliates**
 
- Fan Asylum, Inc.
- Popmail Network, Inc.
- Café Odyssey, Inc.

Schedule 3.6

Litigation

The Company entered into a bridge loan transaction on or about October 6,2000, in which it issued a promissory note in favor of Great Western BusinessServices in the principal amount of $600,000.  The note was payable in 30 daysand was secured by certain computer equipment owned by the Company.Additionally, the lender obtained a "contingent" security interest inthe Company's units of Cafe Odyssey, LLC, which vested upon an event of defaultthereunder.  The Company has failed to repay the note and the lender hasrecently given the Company notice of such default.  Additionally, the lender hasinformed the Company that it intends to retrieve the collateral as soon as ispracticable.  The lender has not given any notice or otherwise communicated tothe Company its intentions with respect to its interest in the Cafe Odysseyunits.   Cafe Odyssey, LLC currently has no assets.

Schedule 3.14

Names of Businesses and Addresses

Fan Asylum, Inc.

1250 Folsom Street

San Francisco, CA  94103
Popmail Network, Inc.

1333 Corporate Drive, Suite 350

Irving, TX  75038
Café Odyssey, LLC

500 16th St. Suite 350

Denver, CO  80202

4. 	Cafe Odyssey	

	320 South Avenue

	Mall of America

	Bloomington, MN  55425

 
**Schedule 3.15

Contingent Liabilities**
The Kenwood Restaurant opened in December 1996 under the nameHotel Discovery and was closed by the Company in August 1999. In November 1999,the Company assigned the related lease (described below) in connection with thepending sale of restaurant assets to a third party, who subsequently reopenedthe restaurant under another name and continues to operate the same. Theproperty is approximately 17,000 square feet in size on three levels and islocated at the northeast corner of Sycamore Plaza at Kenwood Shopping Center inCincinnati, Ohio. Although the third party has paid all payments due under thelease since November 1999, the Company remains primarily obligated under thelease. 

The initial term of the lease is 15 years with an option fortwo additional five-year periods. The lease provides for the payment of both amonthly fixed minimum rent and a percentage rent based on gross sales in excessof an escalating base amount. The monthly fixed minimum rent is $12,833 for thefirst five years of the initial lease term, $14,117 for the sixth through tenthyears of the initial lease term, $15,400 for the eleventh through fifteenthyears of the initial lease term.

In addition to the fixed minimum rent, the lease provides forthe payment of a percentage rent equal to 4% of the gross sales from therestaurant in excess of the following annual gross sales amounts; $3,850,000 forthe first five years of the initial lease term, $4,235,000 for the sixth throughtenth years of the initial lease term, $4,620,000 for the eleventh throughfifteenth years of the initial lease term. No percentage rent was paid in 1998or 1999. In addition to the fixed minimum rent and percentage rent, the Companyis required to pay its proportionate share of common area maintenance costs;taxes, insurance, maintenance and operating costs. 
**Schedule 4.7

Encumbrances**
See Schedule 3.6.

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