Legal Note Agreement

LEGAL NOTE AGREEMENT

This Legal Note Agreement (the Agreement) is made effective as of between Borrower Name: , with address , and Lender Name: , with address .

RECITALS

WHEREAS, Lender has agreed to extend to Borrower a loan in the principal amount of (Principal); and

WHEREAS, the parties desire to set forth the terms and conditions under which Borrower will repay the Principal together with interest thereon; and

WHEREAS, the parties intend that this Agreement shall constitute a legally binding obligation enforceable in accordance with its terms.

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. DEFINITIONS

Capitalized terms used in this Agreement shall have the meanings assigned to them in this Section unless the context otherwise requires. "Business Day" means any day other than a Saturday, Sunday, or other day on which banking institutions are authorized by law to close in the jurisdiction of the Lender's principal address.

2. LOAN AND NOTE

2.1 Loan. Subject to the terms and conditions of this Agreement, Lender hereby makes the loan to Borrower of the Principal, and Borrower hereby promises to repay the Principal together with interest thereon in accordance with the terms of this Agreement.

2.2 Note. Borrower shall execute and deliver to Lender a promissory note evidencing the indebtedness in the form and substance contemplated by this Agreement. The Note shall be payable in full on or before (Maturity Date).

3. INTEREST

3.1 Interest Rate. The unpaid Principal shall bear interest at the rate of per annum, calculated on the basis of a 365-day year and actual days elapsed, until paid in full.

3.2 Accrual and Computation. Interest shall accrue from the date of this Agreement on the outstanding Principal and shall be payable in accordance with the payment schedule set forth in Section 4 below.

4. PAYMENT TERMS

4.1 Payment Schedule. Borrower shall make payments of principal and interest as follows:

Periodic Payment Amount: ; Frequency: ; First payment due on .

4.2 Place of Payment. All payments shall be made to Lender at the address for notices set forth in Section 10 or at such other place as Lender may designate in writing.

5. PREPAYMENT

Borrower may prepay the Principal in whole or in part at any time without premium or penalty, provided Borrower gives Lender at least days' prior written notice of any scheduled prepayment in excess of ordinary periodic payments.

6. DEFAULT

6.1 Events of Default. Each of the following shall constitute an Event of Default: (a) failure to make any payment when due that remains uncured for a period of days; (b) Borrower's insolvency, appointment of a receiver, or commencement of bankruptcy proceedings by or against Borrower; (c) any material breach of Borrower's representations, warranties or covenants under this Agreement that remains uncured for 30 days after written notice.

6.2 Remedies. Upon the occurrence and continuance of any Event of Default, Lender may, at its option, declare the entire unpaid Principal and accrued interest immediately due and payable, and exercise all rights and remedies available at law or in equity. Remedies are cumulative and may be exercised singularly or concurrently.

7. SECURITY

This Note is: Secured Unsecured

If secured is selected, Borrower shall execute and deliver to Lender security instruments, financing statements, or other collateral documentation required by Lender to perfect and maintain the security interest described herein.

8. REPRESENTATIONS AND WARRANTIES

Borrower represents and warrants to Lender that: (a) Borrower is duly organized and validly existing under applicable law; (b) Borrower has full power and authority to execute, deliver and perform this Agreement; (c) the execution, delivery and performance of this Agreement will not violate any law or agreement to which Borrower is subject; and (d) no litigation or proceeding is pending which would reasonably be expected to have a material adverse effect on Borrower's ability to perform its obligations.

9. COVENANTS

Borrower covenants that, until the Principal and all accrued interest are paid in full, Borrower shall: (a) pay taxes and other governmental charges when due; (b) maintain insurance with respect to collateral as required by Lender; and (c) not, without Lender's prior written consent, create any lien or encumbrance on collateral inferior to Lender's security interest.

10. NOTICES

All notices, requests, consents and other communications required or permitted hereunder shall be in writing and shall be deemed given when delivered personally, sent by nationally recognized overnight courier, or mailed by certified mail, return receipt requested, to the addresses below (or to such other address as a party may designate by notice in accordance with this Section).

11. GOVERNING LAW

This Agreement and the Note shall be governed by and construed in accordance with the laws of the state of , without regard to its choice of law rules.

12. ENTIRE AGREEMENT

This Agreement, together with the Note and any documents executed in connection herewith, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, negotiations and understandings, whether written or oral.

13. AMENDMENTS; WAIVER

No amendment, modification or waiver of any provision of this Agreement shall be effective unless in a written instrument signed by the party against whom enforcement is sought. No waiver by either party of any default shall operate as a waiver of any other default or of the same default on a future occasion.

14. SEVERABILITY

If any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

15. COUNTERPARTS

This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Signatures delivered by electronic transmission shall be valid and binding.

16. MISCELLANEOUS

Borrower shall pay all costs and expenses (including reasonable attorneys' fees) incurred by Lender in the enforcement of this Agreement after an Event of Default. The parties acknowledge that time is of the essence with respect to Borrower's payment obligations.

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