Document:

PROMISSORY NOTE

$90,000                                                            JUNE 26, 2003

For valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the undersigned Vertical Computer Systems, Inc. ("Promissor"),
promises to pay to the order of Robert Mokhtarian ("Promissee"), in lawful money
of the United States of America the principal amount of Ninety Thousand Dollars
($90,000.00 U.S.), together with interest on the amount of such principal
outstanding from time to time at the rate of ten (10%) per annum, calculated on
the basis of a three hundred sixty (360) day year containing twelve (12) months
of thirty (30) days each (the "Basic Interest Rate"), at the times and in the
manner provided herein. "Loan Documents" shall include any related agreements
referencing this promissory note (the "Note"), including any security
agreements.

1. Payment of Principal and Interest. Principal and interest shall be paid as
follows: The principal, and all interest, fees, charges, and other amounts owing
hereunder and then unpaid shall be due and payable on March 28, 2004 (the
"Maturity Date"). Promissor shall pay all amounts owing under this Note in
immediately available funds to Promissee at Promissee's address as set forth
herein, or at such other place as may be specified in writing by Promissee. Each
payment, when made, shall be credited first to interest then due, and then at
the option of Promissee to principal, late charges, and other fees and expenses
outstanding hereunder in such order as Promissee may determine.

2. Collateral as Security. This Note is secured by certain collateral, which
encumbers, among other things, the interest of in certain assets, as more
particularly described therein (the "Collateral"). This Note and the Collateral
Pledge Agreement of even date herewith, between Promissee and Pledgor(s), and
any other documents or instruments given or to be given to Promissee to secure
the indebtedness evidenced by this Note are collectively referred to herein as
the "Loan Documents". The Company under no circumstances will cancel the stock
being held as Collateral unless required to do so by a state or federal
regulatory body.

3. Interest Rate Upon Default. Should Promissor fail to pay any amount owing
hereunder as and when due, whether the same is due regularly as scheduled or by
reason of acceleration following default or otherwise, then interest shall
accrue on the past due amount at the Basic Interest Rate.

4 Default; Remedies. Each of the following occurrences and conditions shall
constitute an Event of Default upon written notice by Promissee to Promissor:

      a. failure by Promissor to pay within five (5) business days of the date
when due any money, whether principal, interest, or otherwise, under this Note,
or the breach or default of any obligation to pay money under or secured by the
CollateralAgreement; or

      b. failure of Promissor to perform any obligation other than an obligation
to pay money, as and when performance of such obligation is due under this Note
or Loan Documents which failure continues for fifteen (15) days after notice
thereof from Promissee to Promissor; or

      c. Vertical pledge any of its ownership interest in Now Solutions to
another party as collateral for any loan without pledging the same interest to
Promissee on an equal basis. .

Notwithstanding anything to the contrary herein or any Loan Document, if at any
time following the occurrence of any Event of Default, or following the
occurrence of any event as a consequence of which the obligations evidenced
hereby may be accelerated, then at the election of Promissee and providing that
Promissor has not cured the Event of Default within seven (7) business days
after written notice from Promissee, the entire amount of principal then
outstanding under this Note and all interest, fees, charges, and other amounts
owing and then unpaid hereunder shall become immediately due and payable, and
Promissee may exercise any and all rights that it may have under the Loan
Documents, at law, in equity, and otherwise.

                                 Promissory Note

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5. Attorneys' Fees. Promissor shall pay to Promissee upon demand all costs and
expenses incurred by Promissee in connection with determination, protection, or
enforcement of any and all of Promissee's rights hereunder or under any of the
Loan Documents, including enforcement of any and all obligations of Promissor
hereunder and thereunder and protection, enhancement, or maintenance of the
security interests securing such obligations or the priority of the same .

6. Waiver of Notice. Promissor and each endorser, guarantor and surety of this
Note hereby waive diligence, demand, presentment for payment, notice of
discharge, notice of nonpayment, protest and notice of protest, and specifically
consent to and waive notice of any renewals or extensions of this Note, whether
made to or in favor of Promissor or any other person or persons. Promissor and
each endorser, guarantor and surety of this Note further .

7. Notices. All notices required hereunder or pertaining hereto shall be in
writing and shall be deemed delivered and effective upon the earlier of (i)
actual receipt, or (ii) the date of delivery or refusal of the addressee to
accept delivery if such notice is sent by express courier service or United
States mail, postage prepaid, certified or registered, return receipt requested,
in either case to the applicable address as follows:

To Promissee:     Robert Mokhtarian
                  3436 Verdugo Road, Suite 250
                  Glendale, CA  91208

To Promissor:     Vertical Computer Systems, Inc.
                  6336 Wilshire Boulevard
                  Los Angeles, CA 90048
                  Attn: President

Notwithstanding the foregoing, any notice under or pertaining to the Loan
Documents or the obligations secured thereby given and effective in accordance
with applicable law shall be effective for purposes hereof. Either party may
change the address at which it is to receive notices hereunder to another
business address within the United States (but not a post office box or similar
mail receptacle) by giving notice of such change of address in accordance
herewith.

8. Exercise of Rights. No single or partial exercise of any of Promissee's
rights or powers under this Note or any of the other Loan Documents shall
preclude any other or further exercise thereof or the exercise of any other
right or power. Promissee at all times shall have the right to proceed against
any portion of the security which secures payment of the indebtedness evidenced
hereby in such order and manner as Promissee may elect without waiving any
rights with respect to any other portion of such security. Each and all rights
and remedies of Promissee hereunder and under the Loan Documents are cumulative
and in addition to each and all other such rights and remedies. No exercise of
any right or remedy shall preclude exercise of any other right or remedy.

9. No Waiver. No failure of Promissee to insist upon strict performance of any
obligation of Promissor or to exercise any right or remedy hereunder or under
the Loan Documents, whether before or after any default, shall constitute or
give rise to a waiver thereof, and no waiver of any default shall constitute a
waiver of any future default or of any other default.

10. Assignment; Successors and Assigns. Promissee may assign or otherwise
transfer all or any part of its interest herein. Promptly following written
notice of such assignment or other transfer, duly executed by Promissee,
Promissor shall render full and complete performance hereunder as and when due
to the transferee so designated by Promissee. Promissor shall not assign or
transfer all or any of its interests or obligations hereunder, and any attempted
or purported assignment or transfer by Promissor shall be void and of no force
or effect, except to the extent that the same may be expressly permitted under
the Stock Pledge Agreements. Subject to the foregoing, the terms of this Note
shall apply to, be binding upon, and inure to the benefit of ail parties hereto
and their successors and assigns.

11. Modification. This Note shall not be modified, amended, or terminated,
except by written agreement duly executed and delivered by both Promissee and
Promissor.

                                 Promissory Note

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12. Conflicts. In the event of any conflict between any provision of this Note
and any provision of the Stock Pledge Agreements or the Loan Documents, which
conflict cannot reasonably be resolved in such a way as to give effect to all
provisions herein and therein contained, this Note shall govern.

13. Severability. If any provision of this Note or any payments pursuant to the
terms hereof shall be invalid or unenforceable to any extent, the remainder of
this Note and any other payments hereunder shall not be affected thereby and
shall be enforceable to the greatest extent permitted by law.

14. Governing Law. This Note shall be governed by and construed in accordance
with the laws of the State of California and subject to the jurisdiction and
venue of the state and federal courts of Los Angeles, California.

         IN WITNESS WHEREOF, Promissor has executed and delivered this Note as
of the date first written above.

                                        VERTICAL COMPUTER SYSTEMS, INC.

                                        By _____________________________________
                                           Richard Wade, President

                                 Promissory Note

                                     3 of 3COLLATERAL PLEDGE AGREEMENT

                                                             Date: June 26, 2003

TO:   ROBERT MOKHTARIAN

      To induce you to make a loan of U.S. $90,000.00 to Vertical Computer
Systems as evidenced by its Promissory Note by and between Vertical Computer
Systems, Inc., a Delaware corporation ("Company") and you in that amount dated
the date of this Collateral Pledge Agreement (the "Agreement"), bearing interest
at the rate of ten percent (10%) per annum, and payable to your order on March
31, 2004 (the "Note", which term will include any amendments thereto and
substitutions therefor), and in consideration of your making said loan, and to
secure payment of all amounts owing under the Note and this Agreement and
performance of all of our other obligations under the Note and under this
Agreement, the Company hereby pledges to you and grants you a security interest
limited to $90,000 in Vertical's interest in the $650,000 note issued by Now
Solutions to Vertical.

DEFINITION OF COLLATERAL; METHOD OF SELLING COLLATERAL AND REPAYMENT OF
PROMISSORY NOTE

The term "Collateral" means Vertical's interest in the $650,000 note issued by
Now Solutions to Vertical. Any proceeds received from Now Solutions in
connection with the payment of the Now Note shall be paid immediately to satisfy
any unpaid amounts due under the Note or the Enfacet Note, as applicable.

WARRANTIES

      We hereby warrant to you that:

      a. the Company is duly incorporated and validly existing under the laws of
the State of Delaware;

      b. we have taken all necessary corporate action to authorize the
execution, delivery and performance of this Agreement and the Note, which
constitute our legally binding obligations;

      c. we are the sole owner of the Collateral(s);

      d. the Collateral is validly issued, is fully paid and non-assessable, and
is not subject to any claim, restriction, lien or other encumbrance except as
provided in this Agreement; and

      e. we may pledge and grant a security interest in the Collateral without
obtaining the approval of any other person, corporation, partnership, or other
entity, or any governmental authority.

PROHIBITION ON TRANSFER OF COLLATERAL

      We agree that we will not sell, transfer, assign or encumber any of our
rights in any of the Collateral or grant any rights in or to any of the
Collateral except pursuant to this Agreement.

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DEFAULT

      Upon a default under any of the provisions of the Note, or if any warranty
by us hereunder is incorrect, or if we fail to perform any of our obligations
under this Agreement (any such default or breach of warranty or failure being
herein called "a default under this Agreement"), you may, without notice, take
such action as you deem advisable with respect to the Collateral, including,
without limitation, selling any of the Collateral at public or private sale on
such terms as you deem appropriate; and you are also authorized as our
attorney-in-fact to endorse or otherwise effect the transfer of any of the
Collateral. At any such sale you may be the purchaser.

REMEDIES; ORDER OF PURSUIT

      You shall not be required to resort to or pursue any of your rights or
remedies under or with respect to any other agreement or any other collateral
before pursuing any of your rights or remedies under this Agreement. You may
pursue your rights and remedies in such order as you determine, and the exercise
by you of any right or remedy will not preclude your exercising any other right
or remedy.

DELAY; WAIVER

      The failure or delay by you in exercising any of your rights hereunder or
with respect to the Note or any other collateral securing the Note in any
instance shall not constitute a waiver thereof in that or any other instance.
You may waive your rights only by an instrument in writing signed by you.

EXPENSES

      We agree to pay on demand (a) all expenses (including, without limitation,
legal fees and disbursements) incurred by you in connection with the negotiation
and preparation of this Agreement and the perfection of your security interest
in any of the Collateral, and (b) all expenses of enforcing the provisions of
this Agreement and your rights against any of the Collateral, including, without
limitation, expenses and fees of legal counsel, court costs and the cost of
appellate proceedings.

WHERE TO MAKE PAYMENTS

      All payments under this Agreement shall be made in lawful currency of the
United States of America in immediately available funds at the address as
provided in the Note, or in such other manner or at such other place as you
shall designate in writing.

GOVERNING LAW; AGENT FOR SERVICE OF PROCESS

      This Agreement and your rights and our obligations hereunder shall be
governed by and construed in accordance with the law of the State of California.
We agree that any legal action or proceeding with respect to this Agreement or
any of the Collateral may be brought in the courts of the State of California
and of the United States having jurisdiction in the County of Los Angeles and
State of California and for the purpose of any such legal action or proceeding,
we hereby submit to the non-exclusive jurisdiction of such courts and agree not
to raise and waive any objection we may have based upon personal jurisdiction or
the venue of any such court or forum non conveniens. We agree not to bring any
action or other proceeding with respect to this Agreement or any of our
obligations under this Agreement in any other court unless such courts of the
State of California and of the United States determine that they do not have
jurisdiction in the matter.

      We will at all times maintain an agent to receive service of process in
California, on our behalf with respect to this Agreement, and in the event that,
for any reason, the agent named above or any successor agent shall no longer
serve as our agent to receive service of process in California, we shall
promptly appoint a successor and advise you thereof.

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AMENDMENT

      This Agreement may only be amended by an instrument in writing signed by
you and us.

                                        Very truly yours,

                                        PLEDGOR

                                        VERTICAL COMPUTER SYSTEMS, INC.

                                        ________________________________________
                                        By: Richard Wade

ACCEPTED & AGREED:

                                        PLEDGEE

                                        ROBERT MOKHTARIAN

                                        ________________________________________
                                        By: Robert Mokhtarian

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