$250,000.00 December 9, 2002
FOR VALUE RECEIVED, the undersigned, Citadel Security Software Inc., a Delaware corporation ("Citadel"),
promises to pay to the order of Ken Schnitzer ("Payee"), at such place as Payee may designate in writing, in
lawful money of the United States of America, the principal sum of Two Hundred Fifty Thousand Dollars
($250,000.00) on the terms and conditions hereinafter set forth. This Note shall bear interest at the rate of eight
percent (8%) per year and shall Mature on May 16, 2003, at which time all outstanding principal shall be due
and payable. Additionally, on December 30, 2002 one installment of principal in the amount of $25,000.00 shall
be due and payable by Citadel to Payee.
Events of Default. The entire unpaid principal balance of this Note shall immediately become due and payable, at
the option of Payee, upon the failure by Citadel to pay any installment of principal and interest hereof as and
when the same becomes due and payable in accordance with the terms hereof (the "Event of Default"). In the
event an Event of Default shall occur, the unpaid principal shall accrue interest in the amount of 18% per annum
and Payee may proceed to protect and enforce its rights either by suit in equity and/or by action at law, by other
appropriate proceedings. No delay on the part of Payee in the exercise of any power or right under this Note, or
under any other instrument executed pursuant thereto shall operate as a waiver thereof, nor shall a single or partial
exercise of any other power or right preclude further exercise thereof.
Costs of Collection. It is hereby specially agreed that if this Note is placed into the hands of an attorney for
collection, or if proved, established, or collected in any court, Citadel agrees to pay to Payee an amount equal to
all expenses incurred in enforcing or collecting this Note, including court costs and reasonable attorneys' fees.
Waiver of Rights. Except for the notice expressly provided herein, the under