$40,000.00 Dallas, Texas October 11, 1996
FOR VALUE RECEIVED, Preferred/Telecom, Inc., a Delaware corporation promises to pay to the order of
Lawrence E. Steinberg, at 5420 LBJ Freeway, Suite 540, LB 56, Dallas, Texas 75240, or at such other address
as the holder hereof may designate, the principal sum of Forty Thousand Dollars ($40,000.00), together with
interest on the unpaid principal balance from the date hereof until this note is paid in full at a rate of 10% per
Principal and interest shall be payable in one installment on November 25, 1996.
All payments received shall be applied first to the payment of accrued interest and then to the payment of
Maker shall have the right to prepay any and all amounts due hereunder without penalty for the privilege of doing
No payment shall be considered in default unless it is not paid within ten (10) days after delivery of written notice
In the event default is made in the payment of this Note, the unpaid balance on this Note shall at once become
due and payable, without notice, at the option of the Holder. Failure to exercise this option shall not constitute a
waiver of the right to declare the entire principal due and payable at once at any subsequent time.
If, after default, this Note is placed in the hands of an attorney for collection, or if collected through judicial
proceeding, Maker shall pay, in addition to the sums referred to above, a reasonable sum as a collection or
attorneys' fee and all other costs incurred by Holder in collection of the unpaid amounts due hereunder.
This note is secured evidenced by a Security Agreement of even date herewith between maker and payee.
Each maker, surety, guarantor, endorser or other party liable for the payment of this Note, in whole or in part,
hereby expressly waives presentment and demand for payment, notice of intention to accelerate maturity, notice
of acceleration of maturity, protest and notice of protest and nonpayme