VCMP VCampus Corporation (CE)

Item 2.03 Creation of a Direct Financial Obligation.

        Pursuant to the bridge financing described in Item 1.01 above, the Company issued $3,000,000 in principal amount of secured short-term promissory notes to Fingerhut and Gottbetter for a total purchase price of $1,500,000 on October 31, 2007 and November 6, 2007. The notes are payable in full on the earlier of four months from the date of issuance or upon a sale of the Company or any substantial part of the Company's assets. The new indebtedness is secured and senior to all of the Company's existing indebtedness except for the Company's remaining senior indebtedness owed to SIAR Capital and the other holders of notes issued in the Company's March 2004 financing. The indebtedness due under the notes can be accelerated following the occurrence of certain customary events of default, which includes events such as the failure to make any payment under the notes, the breach of any security interest, mortgage, loan agreement, pledge agreement or guarantee granted as collateral security for the notes, and the commencement of any bankruptcy proceedings. The obligations under the short-term promissory notes are secured by a blanket lien on substantially all of the assets of the Company. The notes are not convertible into common stock or other securities of the Company. The Company can prepay or redeem the notes at any time without penalty or premium. Gottbetter agreed to waive all defaults under its existing 2006 convertible notes and to defer payment thereon until February 1, 2008.

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