SECURED TERM NOTE

Exhibit 10.3

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS.  THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS NOTE UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO PERVASIP CORP. THAT SUCH REGISTRATION IS NOT REQUIRED.

THIS NOTE IS REGISTERED WITH THE AGENT PURSUANT TO SECTION 11.4(B) OF THE PURCHASE AGREEMENT (AS DEFINED BELOW).  TRANSFER OF ALL OR ANY PORTION OF THIS NOTE IS PERMITTED SUBJECT TO THE PROVISIONS SET FORTH IN SUCH SECTION 11.4(B) WHICH REQUIRE, AMONG OTHER THINGS, THAT NO TRANSFER IS EFFECTIVE UNTIL THE TRANSFEREE IS REFLECTED AS SUCH ON THE REGISTRY MAINTAINED WITH THE AGENT PURSUANT TO SUCH SECTION 11.4(B).

FOR VALUE RECEIVED, PERVASIP CORP. (f/k/a eLEC Communications Corp.), a New York corporation (the “ Company ”), hereby promises to pay to VALENS U.S. SPV I, LLC (the “ Holder ”) or its registered assigns or successors in interest, the sum of THREE HUNDRED FORTY-EIGHT THOUSAND DOLLARS ($348,000), together with any accrued and unpaid interest hereon, on September 28, 2010 (the “ Maturity Date ”) if not sooner paid.

Capitalized terms used herein without definition shall have the meanings ascribed to such terms in that certain Securities Purchase Agreement dated as of May 28, 2008 (as amended, restated, modified and/or supplemented from time to time, the “ Purchase Agreement ”) among the Company, the Holder, Valens Offshore SPV I, Ltd., Valens Offshore SPV II, Corp., each other Purchaser and LV Administrative Services, Inc., as administrative and collateral agent for the Purchasers (the “ Agent ” together with the Purchasers, collectively, the “ Creditor Parties ”).

The Principal Amount of this Secured Term Note that is contained in the Restricted Account (as defined in the Restricted Account Agreement referred to in the Purchase Agreement) on the date of issuance of this Secured Term Note is $312,478.

 The following terms shall apply to this Secured Term Note (this “ Note ”):

1.1   Contract Rate .  Subject to Sections 2.2 and 3.9, interest payable on the outstanding principal amount of this Note (the “ Principal Amount ”) shall accrue at a rate per annum equal to twenty percent (20%) (the “ Contract Rate ”).  All interest shall be (i) calculated on the basis of a 360 day year, and (ii) payable monthly, in arrears, commencing on March 1, 2009, on the first business day of each consecutive calendar month thereafter through and including the Maturity Date, and on the Maturity Date, whether by acceleration or otherwise (each an “ Interest Payment Date ”).  Through any Interest Payment Date, interest on the Principal Amount at the rate of fifteen percent (15.0%) per annum that shall have accrued and shall be unpaid as of such Interest Payment Date shall be paid in cash on such Interest Payment Date.  Through any Interest Payment Date, interest on the Principal Amount at the rate of five percent (5.0%) per annum that shall have accrued  and shall be unpaid as of such Interest Payment Date (for any Interest Payment Date, a “ PIK Amount ”) shall be paid on such Interest Payment Date by the addition of such PIK Amount to the Principal Amount.  At the option of the Holder, the increased portion of the Principal Amount shall be evidenced by a note (a “ PIK Note ”) in form and substance reasonably satisfactory to the Holder; provided, however, that such PIK Note shall not be necessary to evidence such portion of the Principal Amount nor shall the absence of such PIK Note relieve the Company of its obligation to pay such portion of the Principal Amount of the Holder.

1.2   Principal Payments .  The Principal Amount (including PIK Amounts) together with any accrued and unpaid interest and any and all other unpaid amounts which are then owing by the Company to the Holder under this Note, the Purchase Agreement and/or any other Related Agreement shall be due and payable on the Maturity Date.

1.3   Optional Redemption .  The Company may prepay this Note (“ Optional Redemption ”) by paying to the Holder a sum of money equal to one hundred percent (100%) of the Principal Amount outstanding at such time together with accrued but unpaid interest thereon and any and all other sums due, accrued or payable to the Holder arising under this Note, the Purchase Agreement or any other Related Agreement (the “ Redemption Amount ”) outstanding on the Redemption Payment Date (as defined below).  The Company shall deliver to the Holder a written notice of redemption (the “ Notice of Redemption ”) specifying the date for such Optional Redemption (the “ Redemption Payment Date ”), which date shall be ten (10) business days after the date of the Notice of Redemption (the “ Redemption Period ”).  On the Redemption Payment Date, the Redemption Amount must be paid in good funds to the Holder.  In the event the Company fails to pay the Redemption Amount on the Redemption Payment Date as set forth herein, then such Redemption Notice will be null and void.  If any Notes issued pursuant to the Purchase Agreement, in addition to this Note, are outstanding (collectively, the “ Outstanding Notes ”) and the Company pursuant to this Section 1.3 elects to make an Optional Redemption, then the Company shall take the same action with respect to all Outstanding Notes and make such payments to all holders of Outstanding Notes on a pro rata basis based upon the Redemption Amount of each Outstanding Note.

2.1   Events of Default .  The occurrence of any of the following events set forth in this Section 2.1 shall constitute an event of default (“ Event of Default ”) hereunder:

(a)   Failure to Pay .  The Company fails to pay when due any installment of principal, interest or other fees hereon in accordance herewith, or the Company fails to pay any of the other Obligations (under and as defined in the Master Security Agreement) when due, and, in any such case, such failure shall continue for a period of three (3) days following the date upon which any such payment was due;

(b)   Breach of Covenant .  The Company or any of its Subsidiaries breaches any covenant or any other term or condition of this Note in any material respect and such breach, if subject to cure, continues for a period of fifteen (15) days after the occurrence thereof.

(c)   Breach of Representations and Warranties .  Any representation, warranty or statement made or furnished by the Company or any of its Subsidiaries in this Note, the Purchase Agreement or any other Related Agreement shall at any time be false or misleading in any material respect on the date as of which made or deemed made.

(d)   Default Under Other Agreements .  The occurrence of any default (or similar term) in the observance or performance of any other agreement or condition relating to any indebtedness or contingent obligation of the Company or any of its Subsidiaries (including, without limitation, the Subordinated Debt (as defined below)) beyond the period of grace (if any), the effect of which default is to cause, or permit the holder or holders of such indebtedness or beneficiary or beneficiaries of such contingent obligation to cause, such indebtedness to become due prior to its stated maturity or such contingent obligation to become payable;

(e)   Bankruptcy .  The Company or any of its Subsidiaries shall (i) apply for, consent to or suffer to exist the appointment of, or the taking of possession by, a receiver, custodian, trustee or liquidator of itself or of all or a substantial part of its property, (ii) make a general assignment for the benefit of creditors, (iii) commence a voluntary case under the federal bankruptcy laws (as now or hereafter in effect), (iv) be adjudicated a bankrupt or insolvent, (v) file a petition seeking to take advantage of any other law providing for the relief of debtors, (vi) acquiesce to, without challenge within ten (10) days of the filing thereof, or failure to have dismissed, within thirty (30) days, any petition filed against it in any involuntary case under such bankruptcy laws, or (vii) take any action for the purpose of effecting any of the foregoing;

(f)   Judgments .  Attachments or levies in excess of $250,000 in the aggregate are made upon the Company or any of its Subsidiary’s assets or a judgment is rendered against the Company’s property involving a liability of more than $250,000 which shall not have been vacated, discharged, stayed or bonded within thirty (30) days from the entry thereof;

(g)   Insolvency .  The Company or any of its Subsidiaries shall admit in writing its inability, or be generally unable, to pay its debts as they become due or cease operations of its present business;

(h)   Change of Control .  A Change of Control (as defined below) shall occur with respect to the Company, unless Holder shall have expressly consented to such Change of Control in writing.  A “Change of Control” shall mean any event or circumstance as a result of which (i) any “Person” or “group” (as such terms are defined in Sections 13(d) and 14(d) of the Exchange Act, as in effect on the date hereof), other than the Holder, is or becomes the “beneficial owner” (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act), directly or indirectly, of 35% or more on a fully diluted basis of the then outstanding voting equity interest of any Company (other than a “Person” or “group” that beneficially owns 35% or m