Document:

ex4_1.htm

    NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE
SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
LAWS.  THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED
OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR
THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION
OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY
ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS
SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.

    

    Principal Amount:
$_________                                                                                                                                                               Issue Date: June ___,
2009

    Purchase Price:
$__________

    

    SUBORDINATED SECURED
CONVERTIBLE PROMISSORY NOTE

    

    FOR VALUE
RECEIVED, Flint Telecom Group, Inc., a Nevada corporation (hereinafter called
“Borrower”), hereby promises to pay to __________________,located at
___________________, Fax:     (   )
___-____ (together with its successors, representatives, and permitted assigns,
the “Holder”) or order, without demand, the sum of ____________________
($      ) (“Principal Amount”) on December __,
2010  (the
“Maturity Date”), if not sooner paid.

    

    The Purchase
Price of this Note represents a 15.00% original issue discount to the
Principal Amount (the “OID”).

    

    This Note
has been entered into pursuant to the terms of a subscription agreement between
the Borrower and the Holder dated at or about the date hereof (the
“Subscription Agreement”), and shall be governed by the terms of such
Subscription Agreement.  Unless otherwise separately defined herein,
all capitalized terms used in this Note shall have the same meaning as is set
forth in the Subscription Agreement.  The following terms shall apply
to this Note:

    

    ARTICLE
I

    

    GENERAL
PROVISIONS

    

    
      	
               
      

            	
              1.1

            	
              Interest.  The
      outstanding principal amount of this Note shall bear simple interest at a
      rate

            

    

    of ten
percent (10%) per annum from the date of this Note above until the Maturity
Date.  Such interest will be based on a 365-day year and calculated
for the actual number of days elapsed in which interest is being
calculated.

    

    
      	
               
      

            	
              1.2

            	
              Interest
      Payments.  The Borrower shall pay the Holder all accrued
      but unpaid interest on

            

    

    the first
business day of each calendar month commencing the month of August
2009.  The Holder shall have no obligation to deliver to the Borrower
any invoice or other statement setting forth the amount of principal, interest
or any other amount due on any payment date, and any absence by the Holder to
provide any such invoice or statement shall not reduce or otherwise impair the
Borrower’s obligation to pay any amounts payable hereunder.  The
Borrower shall make all interest payments under this Note to the Holder by 5:00
p.m. EST on the date when due.  The Borrower shall make all payments
in United States Dollars in immediately available funds transferred by wire
transfer to an account designated by the Holder.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      	
               
      

            	
              1.3

            	
              Default
      Interest.  Upon the occurrence of an Event of Default (as
      defined in Article III

            

    

    hereof),
then to the extent permitted by law, the Borrower will pay interest in cash to
the Holder, payable on demand, on the outstanding principal balance of this Note
from the date of the Event of Default until such Event of Default is cured at
the rate of the lesser of eighteen percent (18%) per annum and the maximum
applicable legal rate per annum.

    

    1.4           Ranking.  Except
as set forth in the next sentence, this Note shall be senior in priority to all
obligations of the Borrower.  This note shall be subordinate in
payment to Thermo Credit LLC obligations for a line of credit not to exceed
$2,000,000 created on June 4, 2009 and as further described in the Borrower’s
SEC Form 8-K filed on June 9, 2009, and the $1,800,000 worth of Series C
Preferred Stock rights of China Voice Holding Corp. as further described in the
Borrower’s SEC Form 8-K filed on April 30, 2009. 

    

    
      	
               
      

            	
              1.5

            	
              Security.  Payment
      of the principal of, and interest on, this Note and all other amounts
      due

            

    

    under the
Subscription Agreement, is secured by certain personal property as provided in
the Security Agreement.

    

    
      	
               
      

            	
              1.6

            	
              Payment.  Payment
      of this Note and all interest thereon shall be paid to the Holder by
      wire

            

    

    transfer
to an account designated by the Holder or at such address outside of the United
States and its possessions as the Holder may instruct the Borrower in writing in
U.S. Dollars.

    

    1.7.           
Amortization.  The
Borrower shall pay to the Holder beginning on [April 1,2010 and on the first day
of each month thereafter, one eighteenth (1/18th) of the
face value of this Note with a final payment on the unpaid or unconverted
remaining Principal Amount on the Maturity Date.  If at any time the
Principal Amount of this Note shall be paid in full pursuant to the terms
hereof, then all accrued interest shall be payable at the time of such principal
payment.

    

    1.8           Conversion
Privileges.  The Conversion Privileges set forth in Article II
shall remain in full force and effect immediately from the date hereof and until
the Note is paid in full regardless of the occurrence of an Event of
Default.  The Note shall be payable in full on the Maturity Date,
unless previously converted into Common Stock in accordance with Article II
hereof.

    

    ARTICLE
II

    

    CONVERSION
RIGHTS

    

    The
Holder shall have the right to convert the principal and any interest due under
this Note into Shares of the Borrower's Common Stock, $0.01 par value per share
(“Common Stock”) as set forth below.

    

    2.1.           Conversion into the
Borrower's Common Stock.

    

    (a)           The
Holder shall have the right from and after the date of the issuance of this Note
and then at any time until this Note is fully paid, to convert any outstanding
and unpaid principal portion of this Note, and accrued interest, at the election
of the Holder (the date of giving of such notice of conversion being a
“Conversion Date”) into fully paid and nonassessable shares of Common Stock as
such stock exists on the date of issuance of this Note, or any shares of capital
stock of Borrower into

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    which
such Common Stock shall hereafter be changed or reclassified, at the Conversion
Price as defined in Section 2.1(b) hereof,determined as provided
herein.  Upon delivery to the Borrower of a completed Notice of
Conversion, a form of which is annexed hereto as Exhibit A, Borrower shall issue
and deliver to the Holder within four (4) business days after the Conversion
Date (such fourth day being the “Delivery Date”) that number of shares of Common
Stock for the portion of the Note converted in accordance with the
foregoing.  At the election of the Holder, the Borrower will deliver
accrued but unpaid interest on the Note, if any, through the Conversion Date
directly to the Holder on or before the Delivery Date.  The number of
shares of Common Stock to be issued upon each conversion of this Note shall be
determined by dividing that portion of the outstanding principal amount of the
Note and accrued but unpaid interest, if any, to be converted, by the Conversion
Price.

    

    (b)           Subject
to adjustment as provided in Section 2.1(c) hereof, the conversion price per
share shall be equal to $0.275 (“Conversion Price”).

    

    (c)           
The Conversion Price and number and kind of shares or other securities to be
issued upon conversion determined pursuant to Section 2.1(a), shall be subject
to adjustment from time to time upon the happening of certain events while this
conversion right remains outstanding, as follows:

    

    A.           Merger, Sale of Assets,
etc.  If (A) the Borrower effects any merger
or  consolidation of the Borrower with or into another entity, (B) the
Borrower effects any sale of all or substantially all of its assets in one or a
series of related transactions,  (C) any tender offer or exchange
offer (whether by the Borrower or another entity) is completed pursuant to which
holders of Common Stock are permitted to tender or exchange their shares for
other securities, cash or property, (D) the Borrower consummates a stock
purchase agreement or other business combination (including, without limitation,
a reorganization, recapitalization, spin-off or scheme of arrangement) with one
or more persons or entities whereby such other persons or entities acquire more
than the 50% of the outstanding shares of Common Stock (not including any shares
of Common Stock held by such other persons or entities making or party to, or
associated or affiliated with the other persons or entities making or party to,
such stock purchase agreement or other business combination), (E) any “person”
or “group” (as these terms are used for purposes of Sections 13(d) and 14(d) of
the 1934 Act) is or shall become the “beneficial owner” (as defined in Rule
13d-3 under the 1934 Act), directly or indirectly, of 50% of the aggregate
Common Stock of the Borrower, or (F) the Borrower effects any reclassification
of the Common Stock or any compulsory share exchange pursuant to which the
Common Stock is effectively converted into or exchanged for other securities,
cash or property (in any such case, a
“Fundamental  Transaction”), this Note, as to the unpaid
principal portion thereof and accrued interest thereon, shall thereafter be
deemed to evidence the right to convert into such number and kind of shares or
other securities and property as would have been issuable or distributable on
account of such Fundamental Transaction, upon or with respect to the securities
subject to the conversion right immediately prior to such Fundamental
Transaction.  The foregoing provision shall similarly apply to
successive Fundamental Transactions of a similar nature by any such successor or
purchaser.  Without limiting the generality of the foregoing, the
anti-dilution provisions of this Section shall apply to such securities of such
successor or purchaser after any such Fundamental Transaction.

    

    B.           Reclassification,
etc.  If the Borrower at any time shall, by reclassification or
otherwise, change the Common Stock into the same or a different number of
securities of any class or classes that may be issued or outstanding, this Note,
as to the unpaid principal portion thereof and accrued interest thereon, shall
thereafter be deemed to evidence the right to purchase an adjusted number of
such securities and kind of securities as would have been issuable as the result
of such change with respect to the Common Stock immediately prior to such
reclassification or other change.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    C.           Stock Splits, Combinations
and Dividends.  If the shares of Common Stock are subdivided or
combined into a greater or smaller number of shares of Common Stock, or if a
dividend is paid on the Common Stock in shares of Common Stock, the Conversion
Price shall be proportionately reduced in case of subdivision of shares or stock
dividend or proportionately increased in the case of combination of shares, in
each such case by the ratio which the total number of shares of Common Stock
outstanding immediately after such event bears to the total number of shares of
Common Stock outstanding immediately prior to such event.

    

                          D.           Share
Issuance.   So long as this Note is outstanding, if the
Borrower shall issue any Common Stock except for the Excepted Issuances, prior
to the complete conversion or payment of this Note, for a consideration per
share that is less than the Conversion Price that would be in effect at the time
of such issuance, then, and thereafter successively upon each such issuance, the
Conversion Price shall be reduced to such other lower issue
price.  For purposes of this adjustment, the issuance of any security
or debt instrument of the Borrower carrying the right to convert such security
or debt instrument into Common Stock or of any warrant, right or option to
purchase Common Stock shall result in an adjustment to the Conversion Price upon
the issuance of the above-described security, debt instrument, warrant, right,
or option and again upon the issuance of shares of Common Stock upon exercise of
such conversion or purchase rights if such issuance is at a price lower than the
then applicable Conversion Price.  The reduction of the Conversion
Price described in this paragraph is in addition to the other rights of the
Holder described in the Subscription Agreement.  Common Stock issued
or issuable by the Borrower for no consideration will be deemed issuable or to
have been issued for $0.01 per share of Common Stock.

    

    (d)           Whenever
the Conversion Price is adjusted pursuant to Section 2.1(c) above, the Borrower
shall promptly mail to the Holder a notice setting forth the Conversion Price
after such adjustment and setting forth a statement of the facts requiring such
adjustment.

    

    (e)           During
the period the conversion right exists, Borrower will reserve from its
authorized and unissued Common Stock not less than an amount of Common Stock
equal to 100% of the amount of shares of Common Stock issuable upon the full
conversion of this Note.  Borrower represents that upon issuance, such
shares will be duly and validly issued, fully paid and
non-assessable.  Borrower agrees that its issuance of this Note shall
constitute full authority to its officers, agents, and transfer agents who are
charged with the duty of executing and issuing stock certificates to execute and
issue the necessary certificates for shares of Common Stock upon the conversion
of this Note.

    

    2.2           Method of
Conversion.  This Note may be converted by the Holder in whole
or in part as described in Section 2.1(a) hereof and the Subscription
Agreement.  Upon partial conversion of this Note, a new Note
containing the same date and provisions of this Note shall, at the request of
the Holder, be issued by the Borrower to the Holder for the principal balance of
this Note and interest which shall not have been converted or paid.

    

    2.3.           Maximum
Conversion.  The Holder shall not be entitled to convert on a
Conversion Date that amount of the Note in connection with that number of shares
of Common Stock which would be in excess of the sum of (i) the number of shares
of Common Stock beneficially owned by the Holder and its affiliates on a
Conversion Date, (ii) any Common Stock issuable in connection with the
unconverted portion of the Note, and (iii) the number of shares of Common Stock
issuable upon the conversion of the Note with respect to which the determination
of this provision is being made on a Conversion Date, which would result in
beneficial ownership by the Holder and its affiliates of more than 4.99% of the
outstanding shares of Common Stock of the Borrower on such Conversion
Date.  For the purposes of the

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    provision
to the immediately preceding sentence, beneficial ownership shall be determined
in accordance with Section 13(d) of the Securities Exchange Act of 1934, as
amended, and Regulation 13d-3 thereunder.  Subject to the foregoing,
the Holder shall not be limited to aggregate conversions of
4.99%.  The Holder shall have the authority and obligation to
determine whether the restriction contained in this Section 2.3 will limit any
conversion hereunder and to the extent that the Holder determines that the
limitation contained in this Section applies, the determination of which portion
of the Notes are convertible shall be the responsibility and obligation of the
Holder.  The Holder may waive the conversion limitation described in
this Section 2.3, in whole or in part, upon and effective after 61 days prior
written notice to the Borrower to increase such percentage to up to
9.99%.

    
 

    ARTICLE
III

    

                                            EVENT OF
DEFAULT

    

    The
occurrence of any of the following events of default (“Event of Default”) shall,
at the option of the Holder hereof, make all sums of principal and interest then
remaining unpaid hereon and all other amounts payable hereunder immediately due
and payable, upon demand, without presentment, or grace period, all of which
hereby are expressly waived, except as set forth below:

    

    3.1           Failure to Pay Principal or
Interest.  The Borrower fails to pay any installment of
principal, interest or other sum due under this Note when due.

    

    3.2           Breach of
Covenant.  The Borrower breaches any material covenant or other
term or condition of the Subscription Agreement, Transaction Document or this
Note in any material respect and such breach, if subject to cure, continues for
a period of twenty (20) days after written notice to the Borrower from the
Holder.

    

    3.3           Breach of Representations
and Warranties.  Any material representation or warranty of the
Borrower made herein, in the Subscription Agreement or any Transaction Document
shall be false or misleading in any material respect as of the date made and the
Closing Date.

    

    3.4           Liquidation.   Any
dissolution, liquidation or winding up of Borrower or any substantial portion of
its business.

     

    3.5           Cessation of
Operations.   Any cessation of operations by Borrower or
Borrower admits it is otherwise generally unable to pay its debts as such debts
become due, provided, however that any disclosure of the Borrower’s ability to
continue as a “going concern” shall not be an admission that the Borrower cannot
pay its debts as they come due.

     

    3.6           Maintenance of
Assets.   The failure by Borrower to maintain any material
intellectual property rights, personal, real property or other assets which are
necessary to conduct its business (whether now or in the future) or that
represents any material part of the Collateral (as defined in the Security
Agreement).

    

    3.7           Receiver or
Trustee.  The Borrower or any Subsidiary of Borrower shall make
an assignment for the benefit of creditors, or apply for or consent to the
appointment of a receiver or trustee for it or for a substantial part of its
property or business; or such a receiver or trustee shall otherwise be
appointed.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    3.8           Judgments.  Any
money judgment, writ or similar final process shall be entered or filed against
Borrower or any of its property or other assets for more than
$100,000.

    

    3.9           Bankruptcy.  Bankruptcy,
insolvency, reorganization or liquidation proceedings or other proceedings or
relief under any bankruptcy law or any law, or the issuance of any notice in
relation to such event, for the relief of debtors shall be instituted by or
against the Borrower or any Subsidiary of Borrower.

    

    3.10           Delisting.   Delisting
of the Common Stock from any Principal Market; failure to comply with the
requirements for continued listing on a Principal Market for a period of five
(5) consecutive trading days; or notification from a Principal Market that the
Borrower is not in compliance with the conditions for such continued listing on
such Principal Market.

    

    3.11           Non-Payment.   A
default by the Borrower under any one or more obligations in an aggregate
monetary amount in excess of $100,000 for more than twenty days after the due
date, unless the Borrower is contesting the validity of such obligation in good
faith and has segregated cash funds equal to not less than one-half of the
contested amount.

    

    3.12           Stop
Trade.  An SEC or judicial stop trade order or Principal Market
trading suspension that lasts for five (5) or more consecutive trading
days.

    

    3.13           Failure to Deliver Common
Stock or Replacement Note.  Borrower's failure to timely
deliver Common Stock to the Holder pursuant to and in the form required by this
Note and Sections 7 and 11 of the Subscription Agreement, or, if required, a
replacement Note.

    

    3.14           Reservation
Default.   Failure by the Borrower to have reserved for
issuance upon conversion of the Note or upon exercise of the Warrants issued in
connection with the Subscription Agreement, the number of shares of Common Stock
as required in the Subscription Agreement, this Note and the Warrants, and such
failure continues for a period of thirty (30) days.

    

    3.15           Financial Statement
Restatement.  The restatement of any financial statements filed
by the Borrower with the Securities and Exchange Commission for any date or
period from two years prior to the Issue Date of this Note and until this Note
is no longer outstanding, if the result of such restatement would, by comparison
to the unrestated financial statements, have constituted a Material Adverse
Effect.

    

    3.16           Reverse
Splits.   The Borrower effectuates a reverse split of its
Common Stock without twenty days prior written notice to the
Holder.

    

    3.17           Event Described in
Subscription Agreement.  The occurrence of an Event of Default
as described in the Subscription Agreement that, if susceptible to cure, is not
cured during any designated cure period.

    

    3.18           Executive Officers Breach of
Duties.  Any of Borrower’s named executive officers or
directors is convicted of a violation of securities laws related to activities
regarding the Borrower’s securities, or a settlement in excess of $250,000 is
reached by any such officer or director relating to a violation of securities
laws related to activities regarding the Borrower’s securities, breach of
fiduciary duties or self-dealing.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    3.19           Cross
Default.  A default by the Borrower of a material term,
covenant, warranty or undertaking of any other agreement to which the Borrower
and Holder are parties, or the occurrence of a material event of default under
any such other agreement to which Borrower and Holder are parties which is not
cured after any required notice and/or cure period.

    

    ARTICLE
IV

    

    MISCELLANEOUS

    

    4.1           Failure or Indulgence Not
Waiver.  No failure or delay on the part of the Holder hereof
in the exercise of any power, right or privilege hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power,
right or privilege preclude other or further exercise thereof or of any other
right, power or privilege.  All rights and remedies existing hereunder
are cumulative to, and not exclusive of, any rights or remedies otherwise
available.

     

    4.2           Notices.  All
notices, demands, requests, consents, approvals, and other communications
required or permitted hereunder shall be in writing and, unless otherwise
specified herein, shall be (i) personally served, (ii) deposited in the mail,
registered or certified, return receipt requested, postage prepaid, (iii)
delivered by reputable air courier service with charges prepaid, or (iv)
transmitted by hand delivery, telegram, or facsimile, addressed as set forth
below or to such other address as such party shall have specified most recently
by written notice.  Any notice or other communication required or
permitted to be given hereunder shall be deemed effective (a) upon hand delivery
or delivery by facsimile, with accurate confirmation generated by the
transmitting facsimile machine, at the address or number designated below (if
delivered on a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if delivered
other than on a business day during normal business hours where such notice is
to be received) or (b) on the first business day following the date of mailing
by express courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur.  The
addresses for such communications shall be:

     

    If to the
Borrower, to:

    Flint
Telecom Group, Inc

    Attn:
Vincent Browne, CEO

    327 Plaza
Real, Suite 319,

    Boca
Raton, FL 33432

    facsimile:
(561) 394 - 2906

    

    If to the
Holder:

    To the
address and facsimile number listed on the first paragraph of this
Note

    

    With a
copy by fax only to (which copy shall not constitute notice):

    Anslow
& Jaclin LLP

    Attn:
Joseph M. Lucosky, Esq.

    195 Route
9 South, Suite 204

    Manalapan,
NJ 07726

    facsimile:
(732) 577-1188

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    4.3           Amendment
Provision.  The term “Note” and all reference thereto, as used
throughout this instrument, shall mean this instrument as originally executed,
or if later amended or supplemented, then as so amended or
supplemented.

     

    4.4           Assignability.  This
Note shall be binding upon the Borrower and its successors and assigns, and
shall inure to the benefit of the Holder and its successors and
assigns.  The Borrower may not assign its obligations under this
Note.

     

    4.5           Expenses.  The
Borrower shall pay the Holder hereof reasonable costs of collection, including
reasonable attorneys’ fees.

     

    A.           Expenses for
Amendments.  If the Holder shall employ counsel for advice or
other representation or shall incur legal or other costs and expenses in
connection with any amendment or modification of this Note or any of the other
Transaction Documents, then, and in any such even, the reasonable counsel fees
arising from such services and all expenses, costs, charges and other reasonable
fees of such counsel incurred in connection with or related to any of the events
or actions described above shall be payable by the company.

     

    B.           Costs of
Collection.  In the event of a default or an Event of Default,
in addition to any other sums payable by the Borrower hereunder, the Borrower
shall pay the Holder’s and any other holders’ of the Notes costs of collection,
including reasonable attorneys’ fees, including post judgment costs of
collection, incurred by the Holder’s or any other holders’ of the Notes in the
collection of the obligations of the Borrower to the Holder and any other
holders of the notes whether under this Note or the other Transaction Documents,
and in the enforcement of any provision hereof and thereof, whether suit be
brought or not.

     

    C.           Expenses in
Dispute.  In the event of any dispute regarding the subject
matter hereunder, the non-prevailing party in any dispute shall be required to
fully reimburse the prevailing party in any dispute for all of its documents
attorneys’ fees, costs and expenses incurred in connection with such dispute,
the outcome of which shall have been determined by a court of competent
jurisdiction.

     

    4.6           Governing
Law.  This Note shall be governed by and construed in
accordance with the laws of the State of New York without regard to conflicts of
laws principles that would result in the application of the substantive laws of
another jurisdiction.  Any action brought by either party against the
other concerning the transactions contemplated by this Agreement must be brought
only in the civil or state courts of New York or in the federal courts located
in the State and county of New York.  Both parties and the individual
signing this Agreement on behalf of the Borrower agree to submit to the
jurisdiction of such courts.  The prevailing party shall be entitled
to recover from the other party its reasonable attorney's fees and
costs.  In the event that any provision of this Note is invalid or
unenforceable under any applicable statute or rule of law, then such provision
shall be deemed inoperative to the extent that it may conflict therewith and
shall be deemed modified to conform with such statute or rule of law. Any such
provision which may prove invalid or unenforceable under any law shall not
affect the validity or unenforceability of any other provision of this Note.
Nothing contained herein shall be deemed or operate to preclude the Holder from
bringing suit or taking other legal action against the Borrower in any other
jurisdiction to collect on the Borrower's obligations to Holder, to realize on
any collateral or any other security for such obligations, or to enforce a
judgment or other decision in favor of the Holder.  This Note shall be deemed an
unconditional obligation of Borrower for the payment of money and, without
limitation to any other remedies of Holder, may be enforced

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    against
Borrower by summary proceeding pursuant to New York Civil Procedure Law and
Rules Section 3213 or any similar rule or statute in the jurisdiction where
enforcement is sought.  For purposes of such rule or statute, any
other document or agreement to which Holder and Borrower are parties or which
Borrower delivered to Holder, which may be convenient or necessary to determine
Holder’s rights hereunder or Borrower’s obligations to Holder are deemed a part
of this Note, whether or not such other document or agreement was delivered
together herewith or was executed apart from this Note.

     

    4.7           Maximum
Payments.  Nothing contained herein shall be deemed to
establish or require the payment of a rate of interest or other charges in
excess of the maximum rate permitted by applicable law.  In the event
that the rate of interest required to be paid or other charges hereunder exceed
the maximum rate permitted by applicable law, any payments in excess of such
maximum rate shall be credited against amounts owed by the Borrower to the
Holder and thus refunded to the Borrower.

     

    4.8           Non-Business
Days.   Whenever any payment or any action to be made
shall be due on a Saturday, Sunday or a public holiday under the laws of the
State of New York, such payment may be due or action shall be required on the
next succeeding business day and, for such payment, such next succeeding day
shall be included in the calculation of the amount of accrued interest payable
on such date.

     

    4.9           Redemption.  This
Note may not be redeemed or called without the consent of the Holder except as
described in this Note or the Subscription Agreement.

    

    4.10           Shareholder
Status.  The Holder shall not have rights as a shareholder of
the Borrower with respect to unconverted portions of this
Note.  However, the Holder will have the rights of a shareholder of
the Borrower with respect to the Shares of Common Stock to be received after
delivery by the Holder of a Conversion Notice to the Borrower.

    

    4.11           Facsimile
Signature.  In the event that the Borrower’s signature is
delivered by facsimile transmission, PDF, electronic signature or other similar
electronic means, such signature shall create a valid and binding obligation of
the Borrower with the same force and effect as if such signature page were an
original thereof.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, Borrower
has caused this Note to be signed in its name by an authorized officer as of the
____ day of June, 2009.

    

    FLINT
TELECOM GROUP, INC.

    

    

    

    

    By:________________________________

               Name:

               Title:

    

    WITNESS:

    

    

    

    ______________________________________

    
      
         

      

      
         

        
          

        

      

      
         

      

    

                                             NOTICE OF
CONVERSION

    

    (To be
executed by the Registered Holder in order to convert the Note)

    

    

    The
undersigned hereby elects to convert $_________ of the principal and $_________
of the interest due on the Note issued by FLINT TELECOM GROUP, INC. on ________,
200__ into Shares of Common Stock of FLINT TELECOM GROUP, INC. (the “Borrower”)
according to the conditions set forth in such Note, as of the date written
below.

    

    

    

    Date of
Conversion:____________________________________________________________________

    

    

    Conversion
Price:______________________________________________________________________

    

    

    Number of Shares of Common Stock Beneficially Owned on
the Conversion Date: Less than 5% of the
outstanding Common Stock of FLINT TELECOM GROUP, INC.

    

    

    

    Shares To
Be
Delivered:_________________________________________________________________

    

    

    Signature:____________________________________________________________________________

    

    

    Print
Name:__________________________________________________________________________

    

    

    Address:_____________________________________________________________________________

    

       ____________________________________________________________________________ex4_2.htm

    SECURITY
AGREEMENT

    

    THIS SECURITY AGREEMENT (the
“Agreement”) is
made as of June__, 2009 by and among Flint Telecom Group Inc., a Nevada
corporation (the “Company”), and the
subscribers identified on the signature pages hereto and their respective
endorsees, transferees and assigns (each a “Secured Party” and,
collectively, the “Secured
Parties”).

     

    WHEREAS, pursuant to the
Subscription Agreement, dated of even date herewith, the Company issued to the
Secured Parties a certain 10% Subordinated Secured Promissory Note (the
“Note”).

     

                          NOW, THEREFORE, in
consideration of the agreements herein contained and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto hereby agree as follows:

     

    1. Certain
Definitions.  As used in this Agreement, the following terms
shall have the meanings set forth in this Section 1.  Terms used but
not otherwise defined in this Agreement that are defined in Article 9 of the UCC
(such as “general intangibles” and “proceeds”) shall have the respective
meanings given such terms in Article 9 of the UCC.  All capitalized
terms not otherwise defined herein shall have the meaning ascribed to them in
the Subscription Agreement.

     

    a. “Collateral” means the
collateral in which the Secured Parties are granted a security interest by this
Agreement and which shall include the following, whether presently owned or
existing or hereafter acquired or coming into existence, and all additions and
accessions thereto and all substitutions and replacements thereof, and all
proceeds, products and accounts thereof, including, without limitation, all
proceeds from the sale or transfer of the Collateral and of insurance covering
the same and of any tort claims in connection therewith:

     

    i. All
goods, including, without limitation, all machinery, equipment, computers, motor
vehicles, trucks, tanks, boats, ships, appliances, furniture, special and
general tools, fixtures, test and quality control devices and other equipment of
every kind and nature and wherever situated, together with all documents of
title and documents representing the same, all additions and accessions thereto,
replacements therefor, all parts therefor, and all substitutes for any of the
foregoing and all other items, owned by the Company and used in connection with
the Company’s businesses and all improvements thereto; and

     

    ii. All
inventory of the Company; and

     

    iii. All of
the Company’s contract rights and general intangibles, including, without
limitation, all partnership interests, stock or other securities, licenses,
distribution and other agreements, computer software development rights,
employee non-compete, non-disclosure and assignment of rights agreements,
leases, franchises, customer lists, quality control procedures, grants and
rights, goodwill, deposit accounts, and income tax refunds; and

     

    iv. All
receivables of the Company including, without limitation, all insurance
proceeds, and rights to refunds or indemnification whatsoever owing, together
with all instruments, all documents of title representing any of the foregoing,
all rights in any merchandising, goods, equipment, motor vehicles and trucks
which any of the same may represent, and all right, title, security and
guaranties with respect to each receivable, including any right of stoppage in
transit; and

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    v. All of
the Company’s Intellectual Property; and

     

    vi. All of
Company’s equity interest in its Subsidiaries (as defined in the Subordinated
Secured Note) and certificates evidencing such equity interest, and any shares
of stock (including, without limitation, a distribution in connection with any
reclassification, increase or reduction of capital or in connection with any
reorganization), or any option or right to acquire shares of stock, in
substitution of, or in exchange for, any of such equity interest, or any stock
dividend or split with respect to such equity interest, and any distributions,
whether dividend or liquidating or otherwise, of any cash or property with
respect to such equity interest; and

     

    vii. All of
the Company’s documents, instruments and chattel paper, files, records, books of
account, business papers, computer programs and the products and proceeds of all
of the foregoing Collateral set forth in paragraphs (i) through (vi), inclusive,
above.

     

    b. “Copyrights” shall
mean all of the following in which the Company now holds or hereafter acquires
any interest (i) all copyrights, whether registered or unregistered, held
pursuant to the laws of the United States, any State thereof or any other
country; (ii) registrations, applications and recordings in the United States
Copyright Office or in any similar office or agency of the United States, any
State thereof or any other country; (iii) any continuations, renewals or
extensions thereof; (iv) any registrations to be issued in any pending
applications; (v) prior versions of works covered by copyright and all works
based upon, derived from or incorporating such works; (vi) income, royalties,
damages, claims and payments now and hereafter due and/or payable with respect
to copyrights, including, without limitation, damages, claims and recoveries for
past, present or future infringement; (vii) rights to sue for past, present and
future infringements of any copyright; (viii) any rights in any material which
is copyrightable or which is protected by common law, United States copyright
laws or similar laws, or any law of any State, and (ix) any other rights
corresponding to any of the foregoing rights throughout the world.

     

    c. “Copyright License”
shall mean any agreement, written or oral, in which the Company now holds or
hereafter acquires any interest, granting any right in or to any Copyright or
Copyright registration (whether the Company is the licensee or the licensor
thereunder) including, without limitation, licenses pursuant to which the
Company has obtained the exclusive right to use a copyright owned by a third
party.

     

    d. “Intellectual
Property” shall mean, collectively, the Software Intellectual Property,
Copyrights, Copyright Licenses, Patents, Patent Licenses, Trademarks, Trademark
Licenses and Trade Secrets.

     

    e. “Obligations” means
all of the Company’s obligations under this Agreement, the Subscription
Agreement and the Note, in each case, whether now or hereafter existing,
voluntary or involuntary, direct or indirect, absolute or contingent, liquidated
or unliquidated, whether or not jointly owed with others, and whether or not
from time to time decreased or extinguished and later decreased, created or
incurred, and all or any portion of such obligations or liabilities that are
paid, to the extent all or any part of such payment is avoided or recovered
directly or indirectly from the Secured Parties as a preference, fraudulent
transfer or otherwise as such obligations may be amended, supplemented,
converted, extended or modified from time to time.

     

    f. “Patents” shall mean
all of the following in which the Company now

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     holds
or hereafter acquires any interest: (i) all patents of the United States or any
other country, all registrations and recordings thereof and all applications for
patents of the United States or any other country, including, without
limitation, registrations, recordings and applications in the United States
Patent and Trademark Office or in any similar office or agency of the United
States, any State thereof or any other country; (ii) all reissues, divisions,
continuations, renewals, continuations in part or extensions thereof; (iii) all
patents to issue in any such applications; (iv) income, royalties, damages,
claims and payments now and hereafter due and/or payable with respect to
patents, including, without limitation, damages, claims and recoveries for past,
present or future infringement; and (v) rights to sue for past, present and
future infringements of any patent.

     

    g. “Patent License” shall
mean any agreement, whether written or oral, in which the Company now holds or
hereafter acquires any interest, granting any right with respect to any Patent
(whether the Company is the licensee or the licensor thereunder).

     

    h. “Software Intellectual
Property” shall mean (i) all software programs (including, without
limitation, all source code, object code and all related applications and data
files), whether now owned, upgraded, enhanced, licensed or leased or hereafter
acquired by the Company; (ii) all computers and electronic data processing
hardware and firmware associated therewith; (iii) all documentation (including,
without limitation, flow charts, logic diagrams, manuals, guides and
specifications) with respect to such software, hardware and firmware described
in the preceding subclauses (i) and (ii); and (iv) all rights with respect to
all of the foregoing, including, without limitation, any and all upgrades,
modifications, copyrights, licenses, options, warranties, service contracts,
program services, test rights, maintenance rights, support rights, improvement
rights, renewal rights and indemnifications and substitutions, replacements,
additions, or model conversions of any of the foregoing.

     

    i. “Trademarks” shall
mean any of the following in which the Company now holds or hereafter acquires
any interest: (i) any trademarks, tradenames, corporate names, company names,
business names, trade styles, service marks, logos, other source or business
identifiers, prints and labels on which any of the foregoing have appeared or
appear, designs and general intangibles of like nature, now existing or
hereafter adopted or acquired, all registrations and recordings thereof and any
applications in connection therewith, including, without limitation,
registrations, recordings and applications in the United States Patent and
Trademark Office or in any similar office or agency of the United States, any
State thereof or any other country (collectively, the “Marks”); (ii) any
reissues, extensions or renewals thereof, (iii) the goodwill of the business
symbolized by or associated with the Marks, (iv) income, royalties, damages,
claims and payments now and hereafter due and/or payable with respect to the
Marks, including, without limitation, damages, claims and recoveries for past,
present or future infringement and (v) rights to sue for past, present and
future infringements of the Marks.

     

    j. “Trademark License”
shall mean any agreement, written or oral, in which the Company now holds or
hereafter acquires any interest, granting any right in and to any Trademark or
Trademark registration (whether the Company is the licensee or the licensor
thereunder).

     

    k. “Trade Secrets” shall
mean common law and statutory trade secrets and all other confidential or
proprietary or useful information and all know-how obtained by or used in or
contemplated at any time for use in the business of the Company (all of the
foregoing being collectively called a “Trade Secret”),
whether or not such Trade Secret has been reduced to a writing or other tangible
form, including, without limitation, all documents and things embodying,
incorporating or referring in

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     any
way to such Trade Secret, all Trade Secret Licenses, and including, without
limitation, the right to sue for and to enjoin and to collect damages for the
actual or threatened misappropriation of any Trade Secret and for the breach or
enforcement of any such Trade Secret license.

     

    l. “UCC” means the
Uniform Commercial Code, as the same may, from time to time, be in effect in the
State of New York; provided, however, in the event that,
by reason of mandatory provisions of law, any or all of the attachment,
perfection or priority of the Secured Parties’ security interest in any
Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New York, the term “UCC” shall mean the
Uniform Commercial Code as in effect in such other jurisdiction for purposes of
the provisions hereof relating to such attachment, perfection of priority and
for purposes of definitions related to such provisions.

     

    2. Grant of
Security Interest.  As a further inducement for the Secured
Parties to enter into the Subordinated Secured Promissory Note and to secure the
complete and timely payment, performance and discharge in full, as the case may
be, of all of the Obligations, the Company hereby, unconditionally and
irrevocably, pledges, grants and hypothecates to the Secured Parties, a
continuing subordinated security interest in, a continuing third lien upon, a
right to possession and disposition of, and a right of set-off against, in each
case to the fullest extent permitted by law, all of the Company’s right, title
and interest of whatsoever kind and nature in and to the Collateral (the “Security
Interest”).

     

    3. Representations,
Warranties, Covenants and Agreements of the Company.  Except as
set forth on Schedule A
attached hereto, the Company represents and warrants to, and covenants and
agrees with, the Secured Parties as follows:

     

    a. The
Company has the requisite corporate power and authority to enter into this
Agreement and otherwise carry out its obligations thereunder.  The
execution, delivery and performance by the Company of this Agreement and the
filings contemplated therein have been duly authorized by all necessary action
on the part of the Company and no further action is required by the
Company.  This Agreement constitutes a legal, valid and binding
obligation of the Company enforceable in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforcement of creditor’s rights
generally.

     

    b. The
Company represents and warrants that it has no place of business or offices
where its respective books of account and records are kept (other than
temporarily at the offices of its attorneys or accountants) or places where the
Collateral is stored or located;

     

    c. Except
for the first security interest granted to Thermo Credit LLC and a second
security interest to China Voice Holding Corp., the Company is the sole owner of
the Collateral (except for non-exclusive licenses granted by the Company in the
ordinary course of business), free and clear of any liens, security interests,
encumbrances, rights or claims, and is fully authorized to grant the Security
Interest in and to pledge the Collateral.  There is not on file in any
governmental or regulatory authority, agency or recording office an effective
financing statement, security agreement, license or transfer or any notice of
any of the foregoing (other than those that have been filed in favor of Thermo
Credit LLC or the Secured Parties pursuant to this Agreement) covering or
affecting any of the Collateral.  So long as this Agreement shall be
in effect, without the prior consent of the Secured Parties, which consent shall
not be unreasonably withheld, the Company shall not execute and shall not
knowingly permit to be on file in any such office or agency any such financing
statement or other document or instrument (except to the extent filed or
recorded in favor of Thermo Credit LLC or the Secured Parties pursuant to the
terms of this Agreement).

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    d. No part
of the Collateral or rights in connection therewith has been judged, by any
governmental body with proper jurisdiction, to be invalid or
unenforceable.  No written claim has been received alleging the
Company’s use of any Collateral violates the rights of any third party. There
has been no adverse decision to the Company’s claim of ownership rights in or
exclusive rights to use the Collateral in any jurisdiction or to the Company’s
right to keep and maintain such Collateral in full force and effect, and there
is no proceeding involving said rights pending or threatened before any court,
judicial body, administrative or regulatory agency, arbitrator or other
governmental authority.

     

    e. The
Company shall at all times maintain its books of account and records relating to
the Collateral at its principal place of business and its Collateral at the
locations set forth on Schedule
A attached hereto.

     

    f. This
Agreement creates in favor of the Secured Parties a valid security interest in
the Collateral securing the payment and performance of the Obligations and, upon
making the filings described in the immediately following sentence, a perfected
third priority security interest in such Collateral and, to the extent that it
can be perfected through such filings, the Intellectual
Property.  Except for the filing of financing statements on Form-1
under the UCC with the jurisdictions indicated on Schedule A, attached hereto,
no authorization or approval of or filing with or notice to any governmental
authority or regulatory body is required either (i) for the grant by the Company
of, or the effectiveness of, the Security Interest granted hereby or for the
execution, delivery and performance of this Agreement by the Company or (ii) for the perfection of, or
exercise by the Secured Parties of, their rights and remedies
hereunder.

     

    g. Prior to
or promptly after the closing of the Subordinated Secured Note, the Secured
Parties shall file or cause to be filed one or more executed UCC financing
statements on Form-1 with respect to the Security Interest with the appropriate
jurisdictions.  Furthermore, upon request of the Secured Parties, the
Company shall execute and deliver any and all agreements, instruments,
documents, and papers as the Secured Parties may reasonably request to evidence
the Secured Parties’ security interest in the Intellectual Property and the
goodwill and general intangibles of the Company relating thereto or represented
thereby.

     

    h. The
execution, delivery and performance of this Agreement does not conflict with or
cause a material breach or default, or an event that with or without the passage
of time or notice, shall constitute a material breach or default, under any
agreement to which the Company is a party or by which the Company is
bound.  No consent (including, without limitation, from stockholders
or creditors of the Company) is required for the Company to enter into and
perform its obligations hereunder.

     

    i. The
Company shall at all times safeguard, protect and maintain the Collateral for
the account of the Secured Parties until this Agreement and the Security
Interest hereunder shall terminate pursuant to Section 12. Without limiting the
generality of the foregoing, the Company shall pay all governmental fees and
taxes necessary to maintain the Collateral and the Security Interest hereunder,
and the Company shall obtain and furnish to the Secured Parties from time to
time, upon demand, such releases and/or subordinations of claims and liens which
may be required to maintain the priority of the Security Interest
hereunder.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    j. The
Company will not transfer, pledge, hypothecate, encumber, license, sell or
otherwise dispose of any of the Collateral without the prior written consent of
the Secured Parties.

     

    k. The
Company shall, within ten (10) days of obtaining knowledge thereof, advise the
Secured Parties promptly, in sufficient detail, of the occurrence of any event
which would have a material adverse effect on the value of the Collateral or on
the Secured Parties’ security interest therein.

     

    l. The
Company shall promptly execute and deliver to the Secured Parties such further
deeds, mortgages, assignments, security agreements, financing statements or
other instruments, documents, certificates and assurances and take such further
action as the Secured Parties may from time to time request and may in its sole
discretion deem necessary to perfect, protect or enforce the Security
Interest.

     

    m. The
Company shall permit the Secured Parties and its representatives and agents to
inspect the Collateral at any time and to make copies of records pertaining to
the Collateral as may be requested by the Secured Parties from time to
time.

     

    n. The
Company will take all steps reasonably necessary to diligently pursue and seek
to preserve, enforce and collect any rights, claims, causes of action and
accounts receivable in respect of the Collateral.

     

    o. The
Company shall promptly notify the Secured Parties in sufficient detail upon
becoming aware of any attachment, garnishment, execution or other legal process
levied against any Collateral and of any other information received by the
Company that may materially affect the value of the Collateral, the Security
Interest or the rights and remedies of the Secured Parties
hereunder.

     

    p. All
information supplied to the Secured Parties by or on behalf of the Company with
respect to the Collateral is accurate and complete in all material respects as
of the date hereof, and all information supplied after the date hereof to the
Secured Parties shall be accurate in all material respects.

     

    q. With
respect to any of the Company’s Intellectual Property:

     

    i. such
Intellectual Property is subsisting and the rights in connection with such
Intellectual Property have not been adjudged invalid or unenforceable, in whole
or in part;

     

    ii. the
rights in connection with such Intellectual Property are valid and
enforceable;

     

    iii. the
Company has made all necessary filings and recordations necessary to protect its
interest in such Intellectual Property, including, without limitation,
recordations of all of its interests in the Patents, Patent Licenses, Trademarks
and Trademark Licenses in the United States Patent and Trademark Office and its
claims to the Copyrights and Copyright Licenses in the United States Copyright
Office;

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    iv. the
Company is the exclusive owner of the entire and unencumbered right, title and
interest in and to such Intellectual Property and no claim has been made that
the use of such Intellectual Property infringes on the asserted rights of any
third party; and

     

    v. the
Company has performed and will continue to perform all acts and has paid all
required fees and taxes to maintain its rights with respect to each and every
item of Intellectual Property in full force and effect throughout the United
States, as applicable.

     

    r. Except
with respect to any Trademark or Copyright that the Company shall reasonably
determine is of negligible economic value to the Company, the Company
shall:

     

    i. maintain
each Trademark and Copyright in full force free from any claim of abandonment
for non-use, maintain as in the past the quality of products and services
offered under such Trademark or Copyright; employ such Trademark or Copyright
with the appropriate notice of registration; not adopt or use any mark which is
confusingly similar or a colorable imitation of such Trademark or Copyright
unless the Secured Party shall obtain a perfected security interest in such mark
pursuant to this Agreement; and not (and not permit any licensee or sublicensee
thereof to) do any act or knowingly omit to do any act whereby any Trademark or
Copyright may become invalidated;

     

    ii. not,
except with respect to any Patent that it shall reasonably determine is of
negligible economic value to it, do any act, or omit to do any act, whereby any
Patent may become abandoned; and

     

    iii. notify
the Secured Parties immediately if it knows, or has reason to know, that any
application or registration relating to any Patent, Trademark or Copyright may
become abandoned, or of any material adverse determination or development
(including, without limitation, the institution of, or any such determination or
development in, any proceeding in the United States Patent and Trademark Office,
the United States Copyright Office or any court or tribunal in the United
States) regarding its ownership of any Patent, Trademark or Copyright or its
right to register the same or to keep and maintain the same.

     

    s. Whenever
the Company, either by itself or through any agent, employee, licensee or
designee, shall file an application for the registration of any Patent,
Trademark or Copyright with the United States Patent and Trademark Office or the
United States Copyright Office or acquire rights to any new Patent, Trademark or
Copyright whether or not registered, report such filing to the Secured Parties
within five (5) business days after the last day of the fiscal quarter in which
such filing occurs.

     

    t. The
Company shall take all reasonable and necessary steps, including, without
limitation, in any proceeding before the United States Patent and Trademark
Office or the United States Copyright Office, to maintain and pursue each
application (and to obtain the relevant registration) and to maintain each
registration of the Patents, Trademarks and Copyrights, including, without
limitation, filing of applications for renewal, affidavits of use and affidavits
of incontestability.

     

    u. In the
event that any Patent, Trademark or Copyright included in the Intellectual
Property is infringed, misappropriated or diluted by a third party, the Company
shall promptly notify the Secured Parties after it learns thereof and shall,
unless it shall reasonably determine that such Patent, Trademark or Copyright is
of negligible economic value to it, which determination it shall

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     promptly
report to the Secured Parties: promptly sue for infringement, misappropriation
or dilution, to seek injunctive relief where appropriate and to recover any and
all damages for such infringement, misappropriation or dilution, or take such
other actions as it shall reasonably deem appropriate under the circumstances to
protect such Patent, Trademark or Copyright.  If the Company lacks the
financial resources to comply with this Section 3(v), the Company shall so
notify the Secured Parties and shall cooperate fully with any enforcement action
undertaken by the Secured Parties on behalf of the Company.

     

    v. None of
such Patents, Trademarks, Copyrights and Trade Secrets is the subject of any
licensing or franchise agreement as of the date of this Agreement.  No
holding, decision or judgment has been rendered by any governmental authority
which would limit, cancel or question the validity of any License, Patent,
Trademark, Copyright and Trade Secrets.  No action or proceeding is
pending (i) seeking to limit, cancel or question the validity of any License,
Patent, Trademark, Copyright or Trade Secret, or (ii) which, if adversely
determined, would have a material adverse effect on the value of any License,
Patent, Trademark, Copyright or Trade Secret.  The Company has used
and will continue to use for the duration of this Agreement, proper statutory
notice in connection with its use of the Patents, Trademarks and Copyrights and
consistent standards of quality in products leased or sold under the Patents,
Trademarks and Copyrights.

     

    4. Defaults.  The
following events shall be “Events of
Default”:

     

    a. The
occurrence of an Event of Default as defined in the Subordinated Secured
Note;

     

    b. If any
representation or warranty of the Company in this Agreement proves to be
incorrect in any material respect when made; and

     

    c. The
failure by the Company to observe or perform any of its obligations hereunder
for ten (10) business days after receipt by the Company of notice of such
failure from the Secured Parties.

     

    5. Duty To
Hold In Trust.  Upon the occurrence of an Event of Default, and
at any time thereafter, the Company shall, upon receipt by it of any revenue,
income or other sums subject to the Security Interest, whether payable pursuant
to the Notes or otherwise, or of any check, draft, note, trade acceptance or
other instrument evidencing an obligation to pay any such sum, hold the same in
trust for the Secured Parties and shall forthwith endorse and transfer any such
sums or instruments, or both, to the Secured Parties for application to the
satisfaction of the Obligations.

     

    6. Rights
and Remedies Upon Default.  Upon occurrence and continuance of
any Event of Default and at any time thereafter, upon the approval and request
from the Secured Parties of at least a majority of the aggregate Principal
Amount of the Notes then outstanding, the Secured Parties shall have the right
to exercise all of the remedies conferred to the Secured Parties hereunder and
under the Notes, and the Secured Parties shall have all the rights and remedies
of a secured party under the UCC and/or any other applicable law (including the
Uniform Commercial Code of any jurisdiction in which any Collateral is then
subject).  Without limitation, the Secured Parties shall have the
following rights and powers:

     

    a. to have a
third party custodian take possession of the Collateral and, for that purpose,
enter, with the aid and assistance of any person, any premises where the
Collateral, or any

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     part
thereof, is or may be placed and remove the same, and the Company shall assemble
the Collateral and make it available to the Secured Parties for the benefit of
the Secured Parties at places which the Secured Parties shall reasonably select,
whether at the Company’s premises or elsewhere, and make available to the
Secured Parties, without rent, all of the Company’s respective premises and
facilities for the purpose of the Secured Parties taking possession of, removing
or putting the Collateral in saleable or disposable form; and

     

    b. to
operate the business of the Company using the Collateral and shall have the
right to assign, sell, lease or otherwise dispose of and deliver all or any part
of the Collateral, at public or private sale or otherwise, either with or
without special conditions or stipulations, for cash or on credit or for future
delivery, in such parcel or parcels and at such time or times and at such place
or places, and upon such terms and conditions as the Secured Parties may deem
commercially reasonable, all without (except as shall be required by applicable
statute and cannot be waived) advertisement or demand upon or notice to the
Company or right of redemption of the Company, which are hereby expressly
waived.  Upon each such sale, lease, assignment or other transfer of
Collateral, the Secured Parties may, unless prohibited by applicable law which
cannot be waived, purchase all or any part of the Collateral being sold, free
from and discharged of all trusts, claims, right of redemption and equities of
the Company, which are hereby waived and released.

     

    7. Indemnification
of the Secured Parties.  Neither the Secured Parties nor any of
its affiliates or representatives will be liable for any action taken or omitted
to be taken by it or them under this Agreement in good faith and believed by it
or them to be within the discretion or power conferred upon it or them by this
Agreement or be responsible for the consequences of any error of judgment
(except for fraud, gross negligence, or willful misconduct).  The Company
shall indemnify the Secured Parties and its representatives and hold them
harmless from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, reasonable expenses, and reasonable
disbursements of any kind or nature whatsoever that may be imposed on, asserted
against, or incurred by them in any way relating to or arising out of this
Agreement or any action taken or omitted by them under this
Agreement.

     

    8. Applications
of Proceeds.  The proceeds of any such sale, lease or other
disposition of the Collateral hereunder shall be applied first, to the expenses
of retaking, holding, storing, processing and preparing for sale, selling, and
the like (including, without limitation, any taxes, fees and other costs
incurred in connection therewith) of the Collateral, to the reasonable
attorneys’ fees and expenses incurred by the Secured Parties in enforcing their
rights hereunder and in connection with collecting, storing and disposing of the
Collateral, and then to satisfaction of the Obligations on a pro rata basis
based on the Principal Amount of each Secured Parties’ Notes at the time of the
default, and to the payment of any other amounts required by applicable law,
after which the Secured Parties shall pay to the Company any surplus
proceeds.  If, upon the sale, license or other disposition of the
Collateral, the proceeds thereof are insufficient to pay all amounts to which
the Secured Parties are legally entitled, then the Company will be liable for
the deficiency, together with interest thereon, plus interest at the Default
Rate as set forth in the Notes, and the reasonable fees of any attorneys
employed by the Secured Parties to collect such deficiency.  To the
extent permitted by applicable law, the Company waives all claims, damages and
demands against the Secured Parties arising out of the repossession, removal,
retention or sale of the Collateral.

     

    9. Costs and
Expenses.  The
Company agrees to pay all out-of-pocket fees, costs and expenses incurred in
connection with any filing required hereunder, including without limitation,
any

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     financing
statements, continuation statements, partial releases and/or termination
statements related thereto or any expenses of any searches reasonably required
by the Secured Parties.  The Company shall also pay all other claims
and charges which would reasonably be expected to prejudice, imperil or
otherwise affect the Collateral or the Security Interest
therein.  Upon the occurrence and continuance of an Event of Default,
the Company shall upon demand, pay to the Secured Parties the amount of any and
all reasonable expenses, including the reasonable fees and expenses of its
counsel and of any experts and agents, which the Secured Parties incurs in
connection with (a) the enforcement of this Agreement, (b) the custody or
preservation of, or the sale of, collection from, or other realization upon, any
of the Collateral, or (c) the exercise or enforcement of any of the rights of
the Secured Parties under the Notes, including, without limitation, costs of
collection.  Until so paid, any fees payable hereunder shall be added
to the principal amount of the Notes and shall bear interest as set forth in the
Notes.

     

    10. Responsibility
for Collateral.  The Company assumes all liabilities and
responsibility in connection with all Collateral, and the obligations of the
Company hereunder or under the Notes shall in no way be affected or diminished
by reason of the loss, destruction, damage or theft of any of the Collateral or
its unavailability for any reason.

     

    11. Security
Interest Absolute.  All rights of the Secured Parties and all
Obligations of the Company hereunder, shall be absolute and unconditional,
regardless of: (a) any change in the time, manner or place of payment or
performance of, or in any other term of, all or any of the Obligations, or any
other amendment or waiver of or any consent to any departure from the Notes or
any other agreement entered into in connection with the foregoing; (b) any
exchange, release or nonperfection of any of the Collateral, or any release or
amendment or waiver of or consent to departure from any other collateral for, or
any guaranty, or any other security, for all or any of the Obligations; or
(c) any action by the Secured Parties to obtain, adjust, settle and cancel
in its sole discretion any insurance claims or matters made or arising in
connection with the Collateral.  The Company expressly waives
presentment, protest and notice of protest.  In the event that at any
time any transfer of any Collateral or any payment received by the Secured
Parties hereunder shall be deemed by final order of a court of competent
jurisdiction to have been a voidable preference or fraudulent conveyance under
the bankruptcy or insolvency laws of the United States, or shall be deemed to be
otherwise due to any party other than the Secured Parties, then, in any such
event, the Company’s obligations hereunder shall survive cancellation of this
Agreement, and shall not be discharged or satisfied by any prior payment thereof
and/or cancellation of this Agreement, but shall remain a valid and binding
obligation enforceable in accordance with the terms and provisions
hereof.  The Company waives all right to require the Secured Parties
to proceed against any other person or to apply any Collateral which the Secured
Parties may hold at any time, or to marshal assets, or to pursue any other
remedy.

     

    12. Term of
Agreement.  This Agreement and the Security Interest shall
terminate on the date on which all payments under the Notes have been
indefeasibly made in full and all other Obligations have been indefeasibly
paid.

     

    13. Power of
Attorney; Further Assurances.

     

    a. The
Company authorizes the Secured Parties, and does hereby make, constitute and
appoint it, and its respective officers, agents, successors or assigns with full
power of substitution, as the Company’s true and lawful attorney-in-fact, with
power, in its own name or in the name of the Company, to, after the occurrence
and during the continuance of an Event of Default, (i) endorse any notes,
checks, drafts, money orders, or other instruments of payment (including,
without

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    limitation,
payments payable under or in respect of any policy of insurance) in respect of
the Collateral that may come into possession of the Secured Parties;
(ii) to sign and endorse any UCC financing statement or any invoice,
freight or express bill, bill of lading, storage or warehouse receipts, drafts
against debtors, assignments, verifications and notices in connection with
accounts, and other documents relating to the Collateral; (iii) to pay or
discharge taxes, liens, security interests or other encumbrances at any time
levied or placed on or threatened against the Collateral; (iv) to demand,
collect, receipt for, compromise, settle and sue for monies due in respect of
the Collateral; and (v) generally, to do, at the option of the Secured
Parties, and at the Company’s expense, at any time, or from time to time, all
acts and things which the Secured Parties deem necessary to protect, preserve
and realize upon the Collateral and the Security Interest granted therein in
order to effect the intent of this Agreement and the Notes, all as fully and
effectually as the Company might or could do; and the Company hereby ratifies
all that said attorney shall lawfully do or cause to be done by virtue
hereof.  This power of attorney is coupled with an interest and shall
be irrevocable for the term of this Agreement and thereafter as long as any of
the Obligations shall be outstanding.

     

    b. On a
continuing basis, the Company will cooperate in good faith with the Secured
Parties to make, execute, acknowledge, deliver, file and record, as the case may
be, in the proper filing and recording places in any applicable jurisdiction,
all such instruments, and take all such action as may reasonably be deemed
necessary or advisable, or as reasonably requested by the Secured Parties, to
perfect the Security Interest granted hereunder and otherwise to carry out the
intent and purposes of this Agreement, or for assuring and confirming to the
Secured Parties the grant or perfection of a security interest in all the
Collateral.

     

    c. The
Company hereby irrevocably appoints the Secured Parties as the Company’s
attorney-in-fact, with full authority in the place and stead of the Company and
in the name of the Company, from time to time in the Secured Parties’
discretion, to take any action and to execute any instrument which the Secured
Parties may deem necessary or advisable in order to perfect the Security
Interest, including the filing, in its sole discretion, of one or more financing
or continuation statements and amendments thereto, relative to any of the
Collateral without the signature of the Company where permitted by
law.

     

    14. Notices.  All
notices, requests, demands and other communications hereunder shall be in
writing, with copies to all the other parties hereto, and shall be deemed to
have been duly given (i) if delivered by hand,
(ii) upon receipt of proof
of sending thereof if sent by facsimile, (iii) upon receipt if sent
by nationally recognized overnight delivery service (receipt requested), the
next business day, or (iv) if mailed by
first-class registered or certified mail, return receipt requested, postage
prepaid, four days after posting in the U.S. mails, in each case if delivered to
the following addresses: (A)  if to the Company, to the address set
forth immediately below the Company’s name on the signature pages hereto; and
(B) if to the Investor, to the address set forth immediately below the
Investor’s name on the signature pages hereto.  Each party shall
provide notice to all of the other parties of any change in
address.

     

    15. Other
Security.  To the extent that the Obligations are now or
hereafter secured by property other than the Collateral or by the guarantee,
endorsement or property of any other person, firm, corporation or other entity,
then the Secured Parties shall have the right, in its sole discretion, to
pursue, relinquish, subordinate, modify or take any other action with respect
thereto, without in any way modifying or affecting any of the Secured Parties’
rights and remedies hereunder.

     

    16. Miscellaneous.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    a. No course
of dealing between the Company and the Secured Parties, nor any failure to
exercise, nor any delay in exercising, on the part of the Secured Parties, any
right, power or privilege hereunder or under the Notes shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or thereunder preclude any other or further exercise thereof
or the exercise of any other right, power or privilege.

     

    b. All of
the rights and remedies of the Secured Parties with respect to the Collateral,
whether established hereby or by the Notes or by any other agreements,
instruments or documents or by law shall be cumulative and may be exercised
singly or concurrently.

     

    c. This
Agreement constitutes the entire agreement of the parties with respect to the
subject matter hereof and is intended to supersede all prior negotiations,
understandings and agreements with respect thereto, including the prior
Agreement.  Any term of this Agreement may be terminated or amended
and the observance of any term of this Agreement may be waived (either generally
or in a particular instance and either retroactively or prospectively) only with
written consent of the Company and the holders of more than fifty percent (50%)
of the then-outstanding principal amount of the Notes.  Any
termination, amendment or waiver effected in accordance with this paragraph
shall be binding upon each holder of the Notes, each future holder of the Notes,
their successors and assigns, and the Company.

     

    d. In the
event that any provision of this Agreement is held to be invalid, prohibited or
unenforceable in any jurisdiction for any reason, unless such provision is
narrowed by judicial construction, this Agreement shall, as to such
jurisdiction, be construed as if such invalid, prohibited or unenforceable
provision had been more narrowly drawn so as not to be invalid, prohibited or
unenforceable.  If, notwithstanding the foregoing, any provision of
this Agreement is held to be invalid, prohibited or unenforceable in any
jurisdiction, such provision, as to such jurisdiction, shall be ineffective to
the extent of such invalidity, prohibition or unenforceability without
invalidating the remaining portion of such provision or the other provisions of
this Agreement and without affecting the validity or enforceability of such
provision or the other provisions of this Agreement in any other
jurisdiction.

     

    e. No waiver
of any breach or default or any right under this Agreement shall be considered
valid unless in writing and signed by the party giving such waiver, and no such
waiver shall be deemed a waiver of any subsequent breach or default or right,
whether of the same or similar nature or otherwise.

     

    f. This
Agreement shall be binding upon and inure to the benefit of each party hereto
and its successors and assigns.

     

    g. Each
party shall take such further action and execute and deliver such further
documents as may be necessary or appropriate in order to carry out the
provisions and purposes of this Agreement.

     

    h. The
validity and interpretation of this Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of New
York.  Each of the parties hereto hereby consents to the exclusive
jurisdiction and venue of the Courts of the State of New York, located in the
City and County of New York and the United States District Court, Southern
District, for the State of New York with respect to any matter relating to this
Agreement and performance of the

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     parties’
obligations hereunder, the documents and instruments executed and delivered
concurrently herewith or pursuant hereto and performance of the parties’
obligations thereunder and each of the parties hereto hereby consents to the
personal jurisdiction of such courts and shall subject itself to such personal
jurisdiction.  Any action, suit or proceeding relating to such matters
shall be commenced, pursued, defended and resolved only in such courts and any
appropriate appellate court having jurisdiction to hear an appeal from any
judgment entered in such courts.  The parties irrevocably waive the
defense of an inconvenient forum to the maintenance of such suit or
proceeding.  Service of process in any action, suit or proceeding
relating to such matters may be made and served within or outside the State of
New York by registered or certified mail to the parties and their
representatives at their respective addresses specified in Section 14 hereof,
provided that a reasonable time, not less than thirty (30) days, is allowed for
response.  Service of process may also be made in such other manner as
may be permissible under the applicable court rules.

     

    i. Each
party hereto hereby agrees to waive its respective rights to a jury trial of any
claim or cause of action based upon or arising out of this
Agreement.  The scope of this waiver is intended to be all
encompassing of any disputes that may be filed in any court and that relate to
the subject mater of this Agreement, including without limitation contract
claims, tort claims, breach of duty claims and all other common law and
statutory claims.  Each party hereto acknowledges that this waiver is
a material inducement for each party to enter into a business relationship, that
each party has relied on this waiver in entering into this Agreement and that
each party will continue to rely on this waiver in their related future
dealings.  Each party further warrants and represents that it has
reviewed this waiver with its legal counsel, and that such party has knowingly
and voluntarily waives its rights to a jury trial following such
consultation.  This waiver is irrevocable, meaning that,
notwithstanding anything herein to the contrary, it may not be modified either
orally or in writing, and this waiver shall apply to any subsequent amendments,
renewals and supplements or modifications to this agreement.  In the
event of litigation, this Agreement may be filed as a written consent to a trial
by the court.

     

    17. Counterparts.  This
Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument.

     

    18. Facsimile
Signature.  In the event that any signature is delivered by
facsimile transmission, PDF, electronic signature or other similar electronic
means, such signature shall create a valid and binding obligation of the party
executing (or on whose behalf such signature is executed) with the same force
and effect as if such signature page were an original thereof.

     

    19.           Priority.  The
security interest granted hereby shall be subordinate to prior  liens
granted by the Company in favor of China Voice Holding Corp. and Thermo Credit
LLC, and Secured Parties shall take no action to enforce any right hereunder
unless and until it shall have given 30 days advance notice to such secured
parties.  If requested by such secured parties, Secured Parties shall
take no action to enforce any such right until the prior secured parties shall
have consented to such actions.

     

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BLANK]

    

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    

     [SIGNATURE PAGE TO SECURITY
AGREEMENT]

    

     

    IN WITNESS WHEREOF, the
parties hereto have caused this Security Agreement to be duly executed on the
day and year first above written.

     

    COMPANY:

     

    FLINT
TELECOM GROUP, INC.

    

    

    By:           ______________________________________

    

    Name:                      ______________________________________

    

    Title:                      ______________________________________

    

    

    Notices:                      If
to the Company:

    

    Flint
Telecom Group, Inc

    Attn:
Vincent Browne, CEO

    327 Plaza Real, Suite 319,

    Boca Raton, FL 33432

    Telephone: (561)
394-2748                                                                           

    Facsimile:
(561) 394 - 2906

    

    If to the
Subscribers: The addresses and fax numbers indicated on the signature page
to

                                        the
Subscription Agreement.

    
 

    
 

    

    

    

    

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    

    

    ACKNOWLEDGEMENT

    

    STATE OF
________________________                                                                                     )

     

    )  ss.:

     

    COUNTY OF
______________________                                                                                     )

     

    On the
___ day of __________________, 200__, before me, the undersigned, a notary
public in and for such state, personally appeared ________________________,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his capacity as an executive
officer on behalf of _________________________, and that by his signature on the
instrument, he executed the

     

    instrument,
and that he make such appearance before the undersigned.

     

    

     

    

     

    

     

    __________________________________

     

    Notary Public

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    ADDITIONAL
SIGNATURE PAGES TO SECURITY AGREEMENT

    

    SECURED
PARTY:

    

    

    

    By:           ______________________________________

    

    Name:                      ______________________________________

    

    Title:                      ______________________________________

    

    
      	
               
      

            	
              Notices:

            

    

    

    

    

    

    

    

    with
copies to (which shall not constitute notice):

    Anslow
& Jaclin LLP

    195 Route
9 South, 2nd Floor

    Manalapan,
NJ 07726

    Attn:
Joseph M. Lucosky, Esq.

             Eric
M. Stein, Esq.

    Telephone:
(732) 409 1212

    Facsimile:
(732) 577 1188

    

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    SCHEDULE
A

     

    Principal Place of Business
of the Company:

    

    327 Plaza
Real, Suite 319

    Boca
Raton, FL 33432

    

    

    Locations Where Collateral
is Located or Stored:

    

    327 Plaza
Real, Suite 319

    Boca
Raton, FL 33432

    

    Phone  House,
Inc. (California Corporation):

    17808
Pioneer Blvd. #106

    Artesia,
CA 90701

    

    Phone
House of Florida, Inc.

    Tampa,
FL

    

    Starcom
Alliance

    

    

    

    

    Exceptions to
Representations and Warranties Under Section 3:

    

    

     

    3q(iii): The Company has not
yet applied for any trademark registrations with the U.S. Patent and Trademark
Office for its any of its trademarks.

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