LOAN AGREEMENT
 
This Loan Agreement (this “Agreement”) is dated as of March ____, 2011, by and
between Composite Technology Corporation, a Nevada corporation (the “Borrower),
and ____________ (the “Lender” and, together with the Borrower, the “Parties”).
 
WITNESSETH
 
WHEREAS, the Borrower wishes to borrow from the Lender
___________________  Dollars ($___________) for the purpose described in Section
2.1 hereof; and
 
WHEREAS, the Lender desires to make a loan to the Borrower for such purpose;
 
NOW, THEREFORE, in consideration of the mutual agreements set forth herein, the
Lender and the Borrower agree as follows:
 
ARTICLE I
DEFINITIONS
 
Section 1.1     General Definitions.
 
“Business Day” means a day on which banks are open for business in The City of
New York.
 
“Code” means the Internal Revenue Code of 1986, as amended, and any Treasury
Regulations promulgated thereunder.
 
“Common Stock” means the common stock of the Borrower.
 
“Default” means any event which, at the giving of notice, lapse of time or
fulfillment of any other applicable condition (or any combination of the
foregoing), would constitute an Event of Default.
 
“Dollars” and the “$” sign mean the lawful currency of the United States of
America.
 
“Excluded Taxes” means all income taxes, minimum or alternative minimum income
taxes, withholding taxes imposed on gross amounts, any tax determined based upon
income, capital gains, gross income, sales, net profits, windfall profits or
similar items, franchise taxes (or any other tax measured by capital, capital
stock or net worth), gross receipts taxes, branch profits taxes, margin taxes
(or any other taxes imposed on or measured by net income, or imposed in lieu of
net income) payable by the Lender in any jurisdiction to any Government
Authority (or political subdivision or taxing authority thereof) in connection
with any payments received under this Agreement by the Lender, or any such tax
imposed in connection with the execution and delivery of, and the performance of
its obligations under, this Agreement.
 
 
 

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“Financing Documents” means this Agreement, the Note, and any other document or
instrument delivered in connection with any of the foregoing, whether or not
specifically mentioned herein or therein.
 
“Government Authority” means any government, governmental department, ministry,
cabinet, commission, board, bureau, agency, tribunal, regulatory authority,
instrumentality, judicial, legislative, fiscal, or administrative body or
entity, domestic or foreign, federal, state or local having jurisdiction over
the matter(s), person(s), individual(s) and/or entity(ies) in question,
including, without limitation, the SEC.
 
“Interest Rate” means twelve percent (12%) per annum.
 
“Lien” means any lien, pledge, preferential arrangement, mortgage, security
interest, deed of trust, charge, assignment, hypothecation, title retention,
privilege or other encumbrance on or with respect to property or interest in
property having the practical effect of constituting a security interest, in
each case with respect to the payment of any obligation with, or from the
proceeds of, any asset or revenue of any kind.
 
“Loan” means the loan to be made available by the Lender to the Borrower
pursuant to this Agreement.
 
“Major Subsidiary” means CTC Cable Corporation and Stribog, Inc.
 
“Management Loan” means the bridge loan in the aggregate amount of $236,274 made
to Borrower by certain officers and directors of Borrower, pursuant to the Loan
Agreements, dated February 22, 2011, by and between such parties.
 
“Material Adverse Effect” means a material adverse effect on (a) the business,
operations, prospects, condition (financial or otherwise) or property of the
Borrower and its Major Subsidiary taken as a whole; provided, however, that none
of the following shall be deemed either alone or in combination to constitute,
and none of the following shall be taken into account in determining whether
there has been or would be, a Material Adverse Effect:  (A) any adverse effect
that results directly or indirectly from general economic, business, financial
or market conditions; and (B) any adverse effect arising directly or indirectly
from or otherwise relating to any of the industries or industry sectors in which
the Borrower or its Major Subsidiary operates.
 
“Maturity Date” means the earlier of (i) the date on which the Borrower closes
any financing in excess of Two Million Dollars ($2,000,000), or (ii) the 30th
day after the date of this Agreement, or (iii) before the Management Loan is
paid
 
“Note” means the note issued to the Lender evidencing the Loan in the form
attached hereto as Exhibit A.
 
 
 

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“Obligations” means all obligations (monetary or otherwise) of the Borrower
arising under or in connection with the Financing Documents.
 
“Organizational Documents” means the Articles of Incorporation (or Certificate
of Incorporation, as applicable) and Bylaws of the Borrower or Major Subsidiary,
as the case may be.
 
“Partners for Growth Debt Documents” means the Loan and Security Agreement by
and among the Borrower, certain of its subsidiaries, and Partners for Growth II,
L.P. (“PFG”), dated as of April 12, 2010, pursuant to which the Borrower
borrowed $10 million from PFG under a secured loan, and the Loan Documents as
filed in Form 8K with the SEC.
 
“Payment in Kind” means the payment to be made by the Borrower to the Lender on
the Maturity Date in the amount of five percent (5%) of the original principal
amount of the Loan. “Additional PIK” means the amount of 20% of the original
principal amount of the Loan to be paid by the Borrower to the Lender in the
event that the Loan is not repaid in full on the Maturity Date or upon the
occurrence of an Event of Default, unless otherwise agreed to in writing by the
Borrower and Lender.
 
“Subsidiary” or “Subsidiaries” means, as to the Borrower, any entity of which
securities or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other persons performing similar functions
are at the time directly or indirectly owned by the Borrower.
 
 “Taxes” means all deductions or withholdings for any and all present and future
taxes, levies, imposts, stamp or other duties, fees, assessments, deductions,
withholdings, all other governmental charges, and all liabilities with respect
thereto.
 
Section 1.2    Interpretation.  In this Agreement, unless the context otherwise
requires, (i) all words and personal pronouns relating thereto shall be read and
construed as the number and gender of the party or parties requires and the verb
shall be read and construed as agreeing with the required word and pronoun; (ii)
the division of this Agreement into Articles and Sections and the use of
headings and captions is for convenience of reference only and shall not modify
or affect the interpretation or construction of this Agreement or any of its
provisions; (iii) the words “herein,” “hereof,” “hereunder,” “hereinafter” and
“hereto” and words of similar import refer to this Agreement as a whole and not
to any particular Article or Section hereof; (iv) the words “include,”
“including,” and derivations thereof shall be deemed to have the phrase “without
limitation” attached thereto unless expressly stated otherwise; (v) references
to a specified Article, Exhibit or Section shall be construed as a reference to
that specified Article, Exhibit or Section of this Agreement; and (vi) any
reference to any of the Financing Documents means such agreement or document as
the same shall be amended, supplemented or modified and from time to time in
effect.
 
 
 

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Section 1.3     Business Day Adjustment.  If the day by which a payment is due
to be made is not a Business Day, that payment shall be made by the next
succeeding Business Day unless that next succeeding Business Day falls in a
different calendar month, in which case that payment shall be made by the
Business Day immediately preceding the day by which such payment is due to be
made.
 
ARTICLE II
AGREEMENT FOR THE LOAN
 
Section 2.1     Use of Proceeds.  The Borrower shall use the Loan for general
corporate purposes.
 
Section 2.2     Disbursement. The Lender agrees to disburse the Loan on the date
of this Agreement.
 
Section 2.3    Repayment.  On the Maturity Date, the Borrower shall pay the
Lender the entire unpaid principal amount of the Loan, all accrued and unpaid
interest, the Payment in Kind and any other amounts owing by the Borrower to the
Lender pursuant to the Financing Documents.  Notwithstanding anything to the
contrary herein, the Borrower may prepay all or any portion of the Loan,
including principal, interest and the Payment in Kind, at any time and from time
to time on or prior to the Maturity Date.  All amounts used to prepay the Loan
shall be applied first to accrued and unpaid interest, second to the Payment in
Kind, and third to the outstanding principal amount.  Repayment in full occurs
when the Borrower pays off all outstanding principal, accrued interest, the
Payment in Kind and any other amounts owing by the Borrower to the Lender
pursuant to the Financing Documents.  The Borrower agrees to repay the Loan in
full before paying all or any portion of the Management Loan.
 
Section 2.4    Interest.  The outstanding principal amount of the Loan shall
bear interest at the Interest Rate, calculated on the basis of the actual number
of days elapsed, payable on the Maturity Date.  Notwithstanding anything to the
contrary herein, the Borrower shall be obligated to pay the Lender a minimum
amount of interest that equals to one percent (1%) of the principal amount of
the Loan.
 
Section 2.5    Payments.  Payments of any amounts due to the Lender under this
Agreement shall be made in Dollars in immediately available funds prior to 4:00
p.m. New York City time on such date that any such payment is due, at such bank
or places, as the Lender shall from time to time designate in writing.  The
Borrower shall pay any and all costs (administrative or otherwise) imposed by
banks, clearing houses, or other financial institutions, in connection with
making any payments under the Financing Documents, except for any costs imposed
by the Lender’s banking institutions.
 
 
 

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Section 2.6     Late Payment.  Without limiting the remedies available to the
Lender under the Financing Documents or otherwise, to the maximum extent
permitted by applicable law, if the Borrower fails to make any payment with
respect to the Loan when due, the Borrower shall pay interest on such late
payment, at the rate per annum equal to the Interest Rate plus four hundred
(400) basis points, for so long as such payment remains outstanding.  Such
interest shall be payable on demand.  In the event that the Loan is not repaid
in full on the Maturity Date or upon the occurrence of an Event of Default, the
Borrower shall pay the Lender Additional PIK, unless otherwise agreed to in
writing by the Borrower and Lender.
 
Section 2.7     Taxes, Duties and Fees.
 
(a)            The Borrower shall pay or cause to be paid any and all present
and future Taxes (other than Excluded Taxes) on or in connection with the
payment of any and all amounts due under this Agreement.  All payments of
principal and other amounts due under this Agreement shall be made without
deduction for or on account of any Taxes (except for Excluded Taxes, which may
be deducted or withheld from payments made by the Borrower only if such
deduction or withholding is required by applicable law).
 
(b)            If the Borrower is required to withhold any such amount or is
prevented by operation of law or otherwise from paying or causing to be paid any
Taxes (except for Excluded Taxes), the principal or other amounts due under this
Agreement, as applicable, shall be increased to such amount as shall be
necessary to yield and remit to the Lender the full amount it would have
received taking into account any such Taxes (except for Excluded Taxes) payable
on amounts payable by the Borrower under this Section 2.7(b) had such payment
been made without deduction of such Taxes (such additional amounts are herein
referred to as the “Additional Amounts”).
 
(c)            If Section 2.7(b) above applies and the Lender so requires, the
Borrower shall deliver to the Lender official tax receipts evidencing payment or
a copy of the filed Tax return reporting such payment (or certified copies
thereof) of the Additional Amounts as soon as practicable.
 
(d)            If the Lender receives a refund from a Government Authority to
which the Borrower has paid withholding Taxes pursuant to this Section 2.7 or
relating to Taxes in respect of which the Borrower paid Additional Amounts, the
Lender shall promptly pay such refund to the Borrower.
 
Section 2.8    Costs, Expenses and Losses.  The Borrower shall pay Lender all
reasonable out-of-pocket fees, charges, costs and expenses incurred by Lender in
connection with the Loan.  If, as a result of any failure by the Borrower to pay
any sums due under this Agreement on the due date therefor, the Lender shall
incur costs, expenses and/or losses, by reason of the liquidation or
redeployment of deposits from third parties or in connection with obtaining
funds to maintain the Loan, the Borrower shall pay to the Lender upon request by
the Lender, the amount of such costs, expenses and/or losses within fifteen (15)
days after receipt by it of a certificate from the Lender setting forth in
reasonable detail such costs, expenses and/or losses.  For the purposes of the
preceding sentence, “costs, expenses and/or losses” shall include, without
limitation, any interest paid or payable to carry any unpaid amount and any
loss, premium, penalty or expense which may be incurred in obtaining,
liquidating or employing deposits of or borrowings from third parties in order
to make, maintain or fund the Loan or any portion thereof.
 
 
 

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Section 2.9     Warrants.  Subject to the terms and conditions as more fully set
forth in the Warrants to Purchase Common Stock executed by Borrower on the date
hereof, Borrower agrees to issue to Lender two warrants for each dollar loaned
exercisable for an aggregate of 200,000 shares of Borrower’s common stock.  Each
of the foregoing warrants will have an exercise price of $0.25 per share and
will be exercisable within two years from the date of issuance.
 
Section 2.10   Security.  To secure the payment and performance of all of the
Obligations when due, Borrower hereby grants to Lender a continuing security
interest in all of Borrower’s assets.
 
ARTICLE III
REPRESENTATIONS AND WARRANTIES
 
Section 3.1     Representations and Warranties of the Borrower. Except as
otherwise disclosed, the Borrower represents and warrants as of the date hereof
as follows:
 
(a)           The Borrower is a corporation duly organized and validly existing
under the laws of the State of Nevada.  The Borrower and each Major Subsidiary
is conducting its business in compliance with its Organizational Documents.  The
Organizational Documents of the Borrower and each Major Subsidiary (including
all amendments thereto) as currently in effect have been made available to the
Lender and remain in full force and effect with no defaults outstanding
thereunder.  All authorizations, consents, approvals, registrations, exemptions
and licenses with or from Government Authorities that are necessary for the
conduct of the business of the Borrower and each Major Subsidiary as currently
conducted and as proposed to be conducted have been obtained and are in full
force and effect.
 
(b)           The Borrower has full power and authority to enter into each of
the Financing Documents and to make the borrowings and the other transactions
contemplated thereby.  All authorizations, consents, approvals, registrations,
exemptions and licenses that are necessary for the borrowing hereunder, the
execution and delivery of the Financing Documents and the performance by the
Borrower of its obligations thereunder have been obtained and are in full force
and effect, except for registrations and filings in connection with the issuance
of the warrants and shares of Common Stock pursuant to the Financing Documents,
and filings necessary to comply with laws, rules, regulations and orders
required in the ordinary course of business.
 
 
 

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(c)           Neither the entering into any of the Financing Documents nor the
compliance with any of its terms conflicts with, violates or results in a breach
of any of the terms of, or constitutes a default or event of default (however
described) or requires any consent under, to the extent applicable, (i) any
agreement to which the Borrower is a party or by which it is bound, (ii) any of
the terms of the Organizational Documents, or (iii) any judgment, decree,
resolution, award or order or any statute, rule or regulation applicable to the
Borrower or its assets.
 
(d)           Neither the Borrower nor any Major Subsidiary (i) is bankrupt or
insolvent or (ii) has taken action, and no such action has been taken by a third
party, for the winding up, dissolution, or liquidation or similar proceeding or
for the appointment of a liquidator, custodian, receiver, trustee, administrator
or other similar officer, in each case for the Borrower or any Major Subsidiary
or all of their respective businesses or assets.
 
(e)           The obligation of the Borrower to make any payment under this
Agreement (together with all charges in connection therewith) is absolute and
unconditional, and there exists no right of setoff or recoupment, counterclaim,
cross-claim or defense of any nature whatsoever to any such payment.
 
ARTICLE IV
COVENANTS AND EVENTS OF DEFAULT
 
Section 4.1     Affirmative Covenants.  Unless the Lender shall otherwise agree:
 
(a)           The Borrower and each Major Subsidiary shall (i) maintain its
existence and qualification to do business in such jurisdictions as may be
required to conduct its business, except where the failure to so maintain such
qualification would not reasonably be expected to have a Material Adverse
Effect; (ii) maintain all approvals necessary for the Financing Documents to be
in effect; (iii) comply in material respects with applicable laws, rules,
regulations and orders of Government Authority; (iv) obtain, make and keep in
full force and effect all licenses, consents, approvals and authorizations from
and registrations with Government Authorities that are required to conduct its
business.
 
Section 4.2     General Acceleration upon Events of Default.  If one or more of
the events specified in this Section 4.2 (each an “Event of Default”) shall have
happened, the Lender, by written notice to the Borrower, (any such notice, an
“Acceleration Notice”), may declare the principal of, accrued interest on, the
Loan or any part thereof (together with any other amounts accrued or payable
under this Agreement) to be, and the same shall thereupon become, immediately
due and payable, without any further notice and without any presentment, demand,
or protest of any kind, all of which are hereby expressly waived by the
Borrower, and take any further action available at law or in equity, including
without limitation the sale of the Loan and all other rights acquired in
connection with the Loan: (a) Lender shall have failed to receive payment of any
amounts, including principal and accrued interest, due under the Note within
five (5) Business Days of their due date; (b) any representation or warranty
made by the Borrower in any Financing Document shall have been incorrect or
false in a material respect as of the date it was made, deemed made, reaffirmed
or confirmed; (c) the commencement by the Borrower or a Major Subsidiary of
proceedings to be adjudicated bankrupt or insolvent, or the consent by it to the
commencement of bankruptcy or insolvency proceedings against it, or the filing
by it of a petition or answer or consent seeking reorganization, intervention or
other similar relief under any applicable law, or the consent by it to the
filing of any such petition or to the appointment of an intervenor, receiver,
liquidator, assignee, trustee, sequestrator or other similar official or of all
or substantially all of their respective assets, or the commencement against the
Borrower or a Major Subsidiary or all or substantially all of its assets of a
proceeding in any court of competent jurisdiction under any bankruptcy or other
applicable law, as now or hereafter in effect, seeking its liquidation, winding
up, dissolution, reorganization, arrangement, adjustment, or the appointment of
an intervenor, receiver, liquidator, assignee, trustee, sequestrator or other
similar official, and any such proceeding shall continue undismissed, or any
order, judgment or decree approving or ordering any of the foregoing shall
continue unstayed or otherwise in effect, for a period of ninety (90) days, or
any other event shall have occurred which under applicable law would have an
effect analogous to any of the events listed above in this subsection.
 
 
 

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Section 4.3     Automatic Acceleration on Dissolution or Bankruptcy.
Notwithstanding any other provisions of this Agreement, if an Event of Default
under Section 4.2(c) shall occur, the principal of the Loan, together with any
other amounts accrued or payable under this Agreement, shall thereupon become
immediately due and payable without any presentment, demand, protest or notice
of any kind, all of which are hereby expressly waived by the Borrower.
 
Section 4.4    Recovery of Amounts Due.  If any amount payable hereunder is not
paid as and when due, the Borrower hereby authorizes the Lender to proceed, to
the fullest extent permitted by applicable law, without prior notice, by right
of set-off, banker’s lien or counterclaim, against any moneys or other assets of
the Borrower to the full extent of all amounts payable to the Lender.
 
ARTICLE V
MISCELLANEOUS
 
Section 5.1     Notices.  Any notice, request or other communication to be given
or made under this Agreement shall be in writing.  Such notice, request or other
communication shall be deemed to have been duly given or made when it shall be
delivered by hand, courier, or facsimile (with a hard copy delivered within two
(2) Business Days) to the Party to which it is required or permitted to be given
or made, at such Party’s address specified below or at such other address as
such Party shall have designated by notice to the other Parties.
 
To the Borrower:
To the Lender:
Composite Technology Corporation
 
2026 McGaw Avenue
 
Irvine, California 92614
 
Attention:  Benton Wilcoxon
 
Facsimile:  (949) 660-1533
 

 
 
 

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Section 5.2     Waiver of Notice.  Whenever any notice is required to be given
to the Lender or the Borrower under any of the Financing Documents, a waiver
thereof in writing, signed by the person or persons entitled to such notice,
whether before or after the time stated therein, shall be deemed equivalent to
the giving of such notice.
 
Section 5.3     Applicable Law.  This Agreement shall be governed by and
construed in accordance with the laws of the State of California without regard
to any conflict of law principles.  The Parties agree to submit to the exclusive
jurisdiction of the courts in Orange County, California for any dispute arising
out of, relating to, or in connection with any Financing Documents.
 
Section 5.4     Successor and Assigns.  This Agreement shall bind and inure to
the respective successors and assigns of the Parties, except that neither Party
may assign or otherwise transfer all or any part of its rights or obligations
under this Agreement without the prior written consent of the other Party.
 
Section 5.5     Entire Agreement.  The Financing Documents contain the entire
understanding of the Parties with respect to the matters covered thereby and
supersede any and all other written and oral communications, negotiations,
commitments and writings with respect thereto.  The provisions of this Agreement
may be waived, modified, supplemented or amended only by an instrument in
writing signed by authorized officers of both Parties.
 
Section 5.6     Severability.  If any provision contained in this Agreement
shall be invalid, illegal or unenforceable in any respect under any law, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.  The Parties shall endeavor in good
faith negotiations to replace the invalid, illegal or unenforceable provisions
with valid provisions, the economic effect of which comes as close as possible
to that of the invalid, illegal or unenforceable provision.
 
Section 5.7    Counterparts.  This Agreement may be executed in several
counterparts, and by each Party on separate counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
agreement.
 
Section 5.8    Survival. This Agreement and all agreements, representations and
warranties made in the Financing Documents, and in any document, certificate or
statement delivered pursuant thereto or in connection therewith shall be
considered to have been relied upon by the Parties and shall survive the
execution and delivery of this Agreement and the making of the Loan regardless
of any investigation made by any other Party or on its behalf, and shall
continue in force until all amounts payable under the Financing Documents shall
have been fully paid in accordance with the provisions hereof and thereof, and
the Lender shall not be deemed to have waived, by reason of making the Loan, any
Default that may arise by reason of such representation or warranty proving to
have been false or misleading, notwithstanding that the Lender may have had
notice or knowledge of any such Default or may have had notice or knowledge that
such representation or warranty was false or misleading at the time made
hereunder.  The obligations of the Borrower under Section 2.7 and the
obligations of the Borrower and the Lender under this Section 5.8 hereof shall
survive and remain in full force and effect regardless of the consummation of
the transactions contemplated hereby, the repayment of the Loan, or the
termination of this Agreement or any provision hereof.
 
 
 

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Section 5.9     Waiver.  Neither the failure of, nor any delay on the part of,
any Party in exercising any right, power or privilege hereunder, or under any
agreement, document or instrument mentioned herein, shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, power or
privilege hereunder, or under any agreement, document or instrument mentioned
herein, preclude other or further exercise thereof or the exercise of any other
right, power or privilege; nor shall any waiver of any right, power, privilege
or default hereunder, or under any agreement, document or instrument mentioned
herein, constitute a waiver of any other right, power, privilege or default or
constitute a waiver of any default of the same or of any other term or
provision.  No course of dealing and no delay in exercising, or omission to
exercise, any right, power or remedy accruing to the Lender upon any default
under this Agreement or any other agreement shall impair any such right, power
or remedy or be construed to be a waiver thereof or an acquiescence therein; nor
shall the action of the Lender in respect of any such default, or any
acquiescence by it therein, affect or impair any right, power or remedy of the
Lender in respect of any other default.  All rights and remedies herein provided
are cumulative and not exclusive of any rights or remedies otherwise provided by
law.
 
Section 5.10   Indemnity.
 
(a)            The Parties shall, at all times, indemnify and hold harmless (the
“Indemnity”) each other and each of their respective directors, officers,
employees, agents, counsel and advisors (each, an “Indemnified Person”) in
connection with any losses, claims, damages, liabilities, penalties, and
expenses incurred by or asserted against an Indemnified Person arising out of
any investigation, litigation or proceeding relating to the Financing Documents
(each, a “Loss”), the extension of credit hereunder or the Loan or the use or
intended use of the Loan, which an Indemnified Person may incur or to which an
Indemnified Person may become subject.  The Indemnity shall not apply to the
extent that a court or tribunal with jurisdiction over the subject matter of the
Loss, and over the Lender or the Borrower, as applicable, and such other
Indemnified Person that had an adequate opportunity to defend its interests,
determines that such Loss resulted from the gross negligence or willful
misconduct of the Indemnified Person, which determination results in a final,
non-appealable judgment or decision of a court or tribunal of competent
jurisdiction.  The Indemnity is independent of and in addition to any other
agreement of any Party under any Financing Document to pay any amount to the
Lender or the Borrower, as applicable, and any exclusion of any obligation to
pay any amount under this subsection shall not affect the requirement to pay
such amount under any other section hereof or under any other
agreement.  Without prejudice to the survival of any other agreement of any of
the Parties hereunder, this Agreement and the obligations of the Parties
contained in this Section 5.10 shall survive the termination of each other
provision hereof and the payment of all amounts payable to the Lender hereunder.
 
 
 

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Section 5.11   No Usury.  The Financing Documents are hereby expressly limited
so that in no contingency or event whatsoever, whether by reason of acceleration
or otherwise, shall the amount paid or agreed to be paid to the Lender for the
Loan exceed the maximum amount permissible under applicable law.  If from any
circumstance whatsoever, fulfillment of any provision hereof, at the time
performance of such provision shall be due, shall involve transcending the limit
of validity prescribed by law, then, ipso facto, the obligation to be fulfilled
shall be reduced to the limit of such validity, and if from any such
circumstance the Lender shall ever receive anything which might be deemed
interest under applicable law, that would exceed the highest lawful rate, such
amount that would be deemed excessive interest shall be applied to the reduction
of the principal amount owing on account of the Loan, or if such deemed
excessive interest exceeds the unpaid balance of principal of the Loan, such
deemed excess shall be refunded to the Borrower.  All sums paid or agreed to be
paid to the Lender for the Loan shall, to the extent permitted by applicable
law, be deemed to be amortized, prorated, allocated and spread throughout the
full term of the Loan until payment in full so that the deemed rate of interest
on account of the Loan is uniform throughout the term thereof.  The terms and
provisions of this paragraph shall control and supersede every other provision
of this Agreement and the Note.
 
Section 5.12  Further Assurances.  From time to time, the Borrower shall perform
any and all acts and execute and deliver to the Lender such additional documents
as may be necessary to carry out the purposes of the Financing Documents or to
preserve and protect the Lender’ rights as set forth therein.
 
 
 

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IN WITNESS WHEREOF, the parties have executed this Agreement by their duly
authorized representative as of the date first above written
 
LENDER
[LENDER NAME]
   
By:
 
Name:
Title:
   
BORROWER
COMPOSITE TECHNOLOGY CORPORATION
   
By:
 
Name: Benton H Wilcoxon
Title: Chairman and CEO

 
 
 

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