Document:

DEMAND
      PROMISSORY NOTE

    

    
      	
              $9,764.00

            	
              June
                30, 2008

            

    

    

    FOR
      VALUE
      RECEIVED, Farrallon, Inc., a corporation organized and existing under the laws
      of State of Nevada, with offices at 14908
      Oxford Hollow, Charlotte, NC 28078(the
      “Company”), promises to pay to the order of DYP Enterprises, LLC, an limited
      liability company having an address at 14908
      Oxford Hollow, Charlotte, NC 28078(the
      "Holder"), the principal amount of Nine Thousand Seven Hundred Sixty-Four
      ($9,764.00), together with interest incurred thereon at the rate of eight
      percent (8%) per annum. The entire unpaid principal and accrued interest thereon
      shall be immediately due and payable on demand by the Holder. Interest payable
      hereunder shall be calculated for actual days elapsed on the basis of a 360-day
      year. Any payments of amounts due hereunder shall be in such currency of the
      United States at the time of payment as shall be legal tender for the payment
      of
      public or private debts. 

    

    This
      Note
      shall be paid without deduction by reason of any set-off, defense or
      counterclaim of the Company. This Note may be repaid in whole or in part by
      the
      Company without penalty or premium at any time and from time to time. All
      payments received by the Holder hereunder will be applied first to costs of
      collection and fees, if any, then to interest, and the balance to principal.
      

    

    All
      payments shall be made at the address for the Holder set forth above, or at
      such
      other place as the Holder hereof may from time to time designate in writing.
      

    

    The
      undersigned waives presentment for payment, demand, protest and notice of
      protest and of non-payment.

    

    Any
      and
      all notices, requests, consents and demands required or permitted to be given
      hereunder shall be in writing, delivered to the addresses stated above. Either
      party may change by notice the address to which notices to it are to be
      addressed.

    

    Notwithstanding
      any other provision of this Note, interest under this Note shall not exceed
      the
      maximum rate permitted by law; and if any amount is paid under this Note as
      interest in excess of such maximum rate, then the amount so paid will not
      constitute interest but will constitute a prepayment on account of the principal
      amount of this Note.

    

    The
      Company agrees to pay on demand all expenses of collecting and enforcing this
      Note and any guarantee or collateral securing this Note, including, without
      limitation, expenses and fees of legal counsel, court costs and the cost of
      appellate proceedings.

    

    The
      failure or delay by the Holder in exercising any of its rights hereunder in
      any
      instance shall not constitute a waiver thereof in that or any other instance.
      The Holder may not waive any of its rights except by an instrument in writing
      signed by the Holder.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    This
      Note
      shall be construed and enforced in accordance with, and the rights of the
      parties shall be governed by, the laws of the State of Nevada, without giving
      effect to the conflict of law provisions thereof.

    

    This
      Note
      may not be assigned, transferred or otherwise negotiated by the Holder without
      the prior written consent of the Company. 

    

    This
      Note
      may not be amended without the written approval of the holder.

    

    IN
      WITNESS WHEREOF, the Company has caused this Note to be signed on the date
      first
      set forth above.

    

    
      	
              FARRALLON,
                INC.

            	 
	 	 	 
	
              By:

            	
              /s/
                Bryan Arthur

            	 
	Print
              Name: Bryan Arthur	 
	Title:
              President	 

    

     

    
      
        
        

      

      
        2Exhibit
      10.1

    

    NARROWSTEP
      INC.

    SUBSCRIPTION
      AGREEMENT

    

    Narrowstep
      Inc.

    116
      Village Boulevard, Suite 200

    Princeton,
      NJ 08540

    

    Gentlemen:

    

    Reference
      is hereby made to the Agreement and Plan of Merger, dated as of May 29, 2008,
      among Onstream Media Corporation (“Onstream”), Onstream Merger Corp. (“Merger
      Sub”) and Narrowstep Inc. (the Company”) and W. Austin Lewis IV, as amended by
      First Amendment to Agreement and Plan of Merger, dated of even date herewith
      (the “Merger Agreement”). The Merger Agreement provides for, among other things,
      the merger of Merger Sub with and into the Company (the “Merger”). Capitalized
      terms used herein have the respective meanings ascribed thereto in the Merger
      Agreement unless otherwise defined herein.

    

    The
      undersigned desires to purchase shares of the Company’s Series A Preferred Stock
      having substantially the terms and conditions described in Schedule I attached
      hereto (the “Preferred Stock”) for an aggregate purchase price of $___________.
      The parties hereto acknowledge that the only condition precedent to the
      obligation of the undersigned to purchase the shares of Preferred Stock
      subscribed for pursuant to this Subscription Agreement (this “Agreement”) is the
      simultaneous consummation of the Merger and that an escrow agent selected by
      the
      Company shall hold the above referenced purchase price in escrow to be released
      upon the undersigned’s purchase of the Preferred Stock in accordance with the
      terms of this Agreement. In connection with the foregoing, the undersigned
      agrees to execute and deliver an escrow agreement in form and substance
      reasonably satisfactory to such escrow agent and the Company.

    

    The
      undersigned acknowledges that a certificate of relative rights, privileges
      and
      designations of the Preferred Stock (the “Certificate of Designation”) shall be
      filed by the Company with the Secretary of State of Delaware prior to the
      Effective Time of the Merger. In addition, the undersigned acknowledges that
      (i)
      on or prior to May 29, 2008 the Company entered into subscription agreements
      for
      the purchase by investors of an aggregate of $300,000 of Preferred Stock (the
      original “Preferred Stock Investment”); and (ii) the Company intends to offer
      additional shares of Preferred Stock in such amounts as determined by the
      Company (the "Offering"). Assuming $700,000 of Preferred Stock is purchased
      in
      the Offering, the aggregate number of shares of Preferred Stock issued pursuant
      to the Original Preferred Stock Investment and the Offering for an aggregate
      purchase price of $1,000,000 will, subject to and in accordance with the terms
      of the Merger Agreement, at the Effective Time, be automatically converted
      into
      and become the right to receive 2,000,000 shares of Onstream common stock,
      par
      value $0.001 per share. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    In
      connection with this Agreement, the undersigned subscriber represents and
      acknowledges as follows:

    

    Section
      1. Access to Information.

    

    The
      Company has provided access to the undersigned and any investment advisor,
      attorney, accountant and/or other purchaser representative acting on behalf
      of
      the undersigned (all of whom are hereinafter collectively referred to as
      "purchaser representatives") copies of all filings made by the Company with
      the
      Securities and Exchange Commission (the “SEC”) on or prior to the date hereof
      (the “SEC Filings”), and an opportunity to ask questions and receive answers
      concerning the proposed business of the Company and the terms and conditions
      of
      the Merger and the Offering, and have provided to the undersigned and the
      undersigned's purchaser representative(s), if any, an opportunity to obtain
      any
      and all additional information necessary to verify the accuracy of the
      information which has been furnished.

    

    Section
      2. Reliance on Own Knowledge and Experience or
      Purchaser Representative.

    

    The
      undersigned represents that it is (i) an institutional “accredited investor”
within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D under
      the
      Securities Act of 1933, as amended (the “Act”), or (ii) a “qualified
      institutional buyer” as such term is defined pursuant to Rule 144A promulgated
      under the Act, as specified by the undersigned on the signature page to this
      Agreement, and that he has had prior investment experience, including
      investments in unregistered securities and is qualified by training and
      experience in business and financial matters to evaluate the merits and risks
      of
      an investment such as the purchase of the Preferred Stock offered by the
      Company.

    

    Section
      3. Subscriber's Acknowledgments.

    

    The
      Company has disclosed to me and the undersigned understands that:

    

    (a) There
      is
      no present public market for the Preferred Stock and it is unlikely that a
      public market for the Preferred Stock will develop in the future.

    

    (c) Due
      to
      the absence of a public market for the Preferred Stock: (i) the undersigned
      may
      not be able to liquidate this investment in the event of an unexpected need
      for
      cash; (ii) transferability of the Preferred Stock is extremely limited; and
      (iii) in the event of a disposition of the Preferred Stock, the undersigned
      could sustain the loss of all or part of his investment in the Preferred
      Stock.

    

    (d) The
      Preferred Stock has not been registered under the Act or State securities laws
      and, therefore, the Preferred Stock cannot be resold or transferred unless
      it is
      subsequently registered under the Act and applicable State securities or "Blue
      Sky" laws or exemptions from such registration are available.

    

    (e) A
      legend
      summarizing the restrictions on the transfer of the Preferred Stock will be
      made
      on the Preferred Stock to be purchased by me.

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    (f) The
      Preferred Stock has not been registered under the Act in reliance upon an
      exemption under the provisions of that Act which depends, in part, upon the
      investment intention of the purchaser. In this connection, the undersigned
      understands that it is the position of the SEC that the statutory basis for
      such
      exemption would not be present if the representation of the purchaser merely
      meant that its present intention was to hold such Preferred Stock for a short
      period, such as the capital gains period of the Internal Revenue Code, for
      a
      deferred sale, for a market rise, or for a sale if the market does not rise
      (assuming that a market develops) for a year, or for any other fixed period.
      The
      undersigned realizes that, in the view of the SEC, a purchase now with an intent
      to resell would represent a purchase with an intent inconsistent with this
      investment representation, and the SEC might regard such a sale or disposition
      as a deferred sale to which the exemption is not available.

    

    (g) An
      investment in the Company involves considerable risks not associated with other
      investments, including without limitation, the risks identified in the SEC
      Filings.

    

    (h) No
      Federal or State agency has made any finding or determination as to the fairness
      of the investment, nor have they made any recommendation or endorsement
      concerning the Preferred Stock.

    

    (i) This
      Subscription Agreement is not revocable by the undersigned and the undersigned
      is submitting this Agreement intending to be legally bound thereby.

    

    (j) The
      undersigned acknowledges that he has reviewed the SEC Filings to the extent
      he
      deemed necessary or advisable. The undersigned has had an opportunity to ask
      questions of and has received answers from the Company concerning any of the
      information contained in the SEC Filings and any other information requested
      by
      the undersigned regarding the Merger, the Offering and the business and
      operations of the Company.

    

    Section
      4. Subscriber Representations.

    

    The
      undersigned represents and warrants as follows:

    

    (a) The
      undersigned is acquiring the Preferred Stock for his own account for investment
      only and not for or with a view to resale or distribution. The undersigned
      has
      not entered into any contract, undertaking, agreement or arrangement with any
      person to sell, transfer or pledge to such person or anyone else the Preferred
      Stock which he is subscribing to purchase and the undersigned has no present
      plans or intentions to enter into any such contract, undertaking, agreement
      or
      arrangement.

    

    (b) The
      undersigned can bear the economic risk of losing his entire investment in the
      Preferred Stock. The undersigned is prepared to bear the economic risk of this
      investment for an indefinite time.

    

    (c) The
      overall commitment of the undersigned to investments which are not readily
      marketable is not disproportionate to his net worth, and an investment in the
      Preferred Stock will not cause such overall commitment to become excessive.
      The
      undersigned's need for diversification in his investment portfolio will not
      be
      impaired by an investment in the Company.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    (d) The
      undersigned has adequate means of satisfying his short term needs for cash
      and
      has no present need for liquidity which would require him to sell his Preferred
      Stock.

    

    (e) The
      undersigned has substantial experience in making investment decisions of this
      type and/or he is relying on his own advisors in making this investment decision
      and, therefore, either alone or together with its advisors, he has such
      knowledge and experience in financial and business matters that he is capable
      of
      evaluating the merits and risks of an investment in the Company.

    

    (f) The
      principal business address of the undersigned, or if the undersigned is an
      individual, his principal residence, is in the state indicated in the address
      beneath his signature at the end of this Agreement. Unless otherwise indicated,
      all communications, contacts and discussions relating to the Offering occurred
      in the state in which the undersigned maintains its office, or if the
      undersigned is an individual, in the state in which he maintains his
      residence.

    

    Section
      5. Reliance on Representations.

    

    The
      undersigned acknowledges and understands that the Company and its directors,
      officers, employees, agents and representatives are relying upon the
      information, representations and agreements contained in this Agreement and
      upon
      any other information which has been furnished by the undersigned in determining
      that the undersigned is a suitable investor and that this investment is duly
      authorized and in deciding to accept the undersigned's subscription for the
      Preferred Stock.

    

    Section
      6. Agreements
      of the Undersigned Subscriber.

    

    The
      undersigned hereby agrees as follows:

    

    (a) This
      offer may be accepted or rejected, in whole or in part, in the sole discretion
      of the Company.

    

    (b) In
      the
      event this offer to purchase is accepted, the undersigned agrees to execute
      all
      documents in connection therewith deemed necessary or advisable by the Company
      in its sole discretion.

    

    (c) Any
      Preferred Stock acquired pursuant to the Offering will not be sold or otherwise
      transferred: (i) without the prior written consent of the Company, which consent
      shall be conditioned on receipt of an opinion of counsel reasonably satisfactory
      to the Company to the effect that such proposed transfer is being made pursuant
      to the registration requirements of the Act or pursuant to an exemption
      therefrom and complies in all respects with any applicable state securities
      or
      "Blue Sky" laws, or (ii) without registration under the Act and applicable
      State
      securities or "Blue Sky" laws.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    (d) In
      the
      event the subscription is not accepted, any money tendered will be refunded
      in
      full without interest and without deduction within a reasonable period of
      time.

    

    Section
      7. Representations Relating to Authority.

    

    If
      the
      undersigned subscriber is a corporation, partnership, trust or other entity,
      the
      undersigned represents and warrants that:

    

    (a) It
      is
      duly incorporated or organized, validly existing and in good standing in its
      state of incorporation or organization and in all other jurisdictions in which
      the character of its business makes such qualification necessary.

    

    (b) It
      has
      full power and authority to enter into, deliver and perform this Agreement
      and
      it has taken all action required to authorize the execution and delivery of
      this
      Agreement and to consummate the transactions contemplated hereby. This Agreement
      is the valid and binding obligation of the subscriber, enforceable against
      it in
      accordance with its terms and the person signing such documents on behalf of
      the
      subscriber has been duly authorized to act on behalf of and to bind the
      subscriber.

    

    (c) The
      execution and delivery of this Agreement and the consummation of the
      transactions contemplated hereby will not violate any provision of the
      certificate of incorporation and by-laws or the partnership agreement, trust
      agreement or limited liability company operating agreement, as applicable,
      or
      any agreement or contract to which the subscriber is a party or by which it
      is
      bound, or any applicable law, ordinance, rule or regulation of any governmental
      body having jurisdiction over the subscriber or its business or any order,
      judgment or decree applicable to the subscriber.

    

    Section
      8. Consent
      to Merger.

    

    The
      undersigned subscriber hereby consents to, ratifies and approves the Merger
      and
      consents to, ratifies and approves the Merger Agreement. If requested by the
      Company or Onstream, the undersigned hereby agrees to execute a separate consent
      evidencing the consent of the undersigned as a holder of Preferred Stock to
      the
      approval of the Merger and the adoption of the Merger Agreement and to take
      such
      actions as may be reasonably requested to evidence such consent and
      approval.

    

    Section
      9. Indemnification.

    

    The
      undersigned subscriber agrees to indemnify and hold harmless the Company and
      each director, officer, employee, agent or representative thereof from and
      against any and all loss, damage or liability and all related costs and expenses
      (including but not limited to, reasonable attorney's fees and costs of
      investigation) due to or arising out of a breach of any covenant, representation
      or warranty made by him in this Agreement.

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    Section
      10. Miscellaneous.

    

    (a) All
      notices or other communications given or made hereunder shall be in writing
      and
      shall be delivered or mailed by registered or certified mail, return receipt
      requested, postage prepaid to the undersigned at the address set forth below
      and
      to the Company at the address set forth above.

    

    (b) Notwithstanding
      the place where this Agreement may be executed by any of the parties hereto,
      the
      parties expressly agree that all the terms and provisions hereof shall be
      governed by, and construed in accordance with, the laws of the State of New
      York
      without regard to the choice of law principles thereof.

    

    (c) This
      Agreement constitutes the entire agreement between the parties hereto with
      respect to the subject matter hereof and may be amended only by a writing
      executed by all parties.

    

    (d) Whenever
      required by the context hereof, the singular shall include the plural, and
      vice-versa; the masculine shall include the feminine and neuter genders, and
      vice-versa; and the word "person" shall include an individual, corporation,
      partnership, trust, estate or other entity.

    

    Section
      11. Foreign Person.
      (check
      one)

    

     ̈
      The
      undersigned hereby certifies that he is not a "foreign person" within the
      meaning of Section 7701(a)(30) of the Internal Revenue Code and agrees to notify
      the Company prior to becoming a foreign person as so defined. A "foreign person"
      is a person who is not a citizen or resident of the United States.

    

     ̈
      The
      undersigned hereby certifies that he is a "foreign person" within the meaning
      of
      Section 7701(a)(30) of the Internal Revenue Code.

    

    Section
      12. Subscription.

    

    The
      undersigned hereby subscribes for shares of Preferred Stock at the aggregate
      purchase price indicated below:

    

    Purchase
      Price: $______________

    

    The
      check
      of the undersigned in the amount indicated above, payable to the Company, or
      a
      wire transfer or delivery to the account of the Company, will be delivered
      to
      the Company upon demand and, in any event, prior to the Effective
      Time.

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    THE
      UNDERSIGNED SUBCRIBER HEREBY REPRESENTS AND WARRANTS TO THE COMPANY THAT IT
      IS:

    

     ̈
      an
      institutional “accredited investor” within the meaning of Rule 501(a)(1), (2),
      (3) or (7) of Regulation D under the Securities Act of 1933, as
      amended.

    

     ̈
      a
“qualified institutional buyer” as such term is defined pursuant to Rule 144A
      under the Securities Act of 1933, as amended.

    

      
        	
                NAME AND ADDRESS OF SUBSCRIBER:  

              	 
	
                 

              	 

      

    

     

    
      	 	 	
               

            
	
              Telephone
                Number

            	 	
              Signature,
                if individual

            
	 	 	 
	 	 	
              By:

            	 
	
              Social
                Security Number

            	 	 
	
              or
                Taxpayer I.D. No.

            	 	 
	 	 	
              TITLE,
                if applicable

            

    

    

    Company Acceptance:

    

    Accepted
      on ___________________, 2008

    

    
      	NARROWSTEP
              INC.
	 	 
	
              By: 

            	
               

            
	 	
              Title:

            

    

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

       

    

    Schedule
      I

    

    Material
      Terms of Series A Preferred Stock

    

    The
      Series A Preferred Stock shall be entitled to such dividends as may be declared
      by the board of Directors from time to time out of funds legally available
      therefor.

    

    Upon
      any
      liquidation, dissolution or winding up of the Company, the holders of the Series
      A Preferred Stock shall be entitled to a liquidation preference equal to the
      stated value of the shares of Series A Preferred Stock held by them together
      with all unpaid dividends in respect thereof.

    

    Holders
      of Series A Preferred Stock shall have no voting rights except as may be
      provided by applicable law.

    

    No
      shares
      of any class or series ranking prior to the Series A Preferred Stock as to
      dividends or upon liquidation may be issued without the approval of the holders
      of a majority of the Series A Preferred Stock then outstanding.

    

    The
      holders of the Series A Preferred Stock shall have no right to convert the
      Series A Preferred Stock into Common Stock or any other security of the Company
      and shall have no right to force the redemption or repurchase of the Series
      A
      Preferred Stock by the Company.

    

    
      
        
        

      

      
        -8-

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