Exhibit 4.1


 


FORM OF PROMISSORY NOTE


 


Borrower
Address:                                                                                              .


 


1. Promise
to Pay. In return for
a loan I have received, I promise to pay to the order of Prosper Marketplace,
Inc. (“you”) the principal sum of                                           
Dollars ($                       ),
together with interest thereon commencing on the date of funding at the rate of
            
percent (           %)
per annum simple interest. I understand that references in this Note to you
shall also include any person to whom you transfer this Note.


 


2. Payments.
This Note is payable
in 36 monthly installments of $                         
each, consisting of principal and interest, commencing on the                   
day of                             ,
and continuing until the final payment date of                                                  ,
which is the maturity date of this Note. The final payment shall consist of the
then remaining principal, unpaid accrued interest and other charges due under
this Note. All payments will be applied first to any late charges then due,
then to any unpaid fees incurred as a result of failed automated payments or
returned checks or bank drafts as provided in Paragraph 11, then to interest
then due and then to principal. No unpaid interest or charges will be added to
principal.


 


3. Interest.
Interest will be
charged on unpaid principal until the full amount of principal has been paid. Interest
under this Note will accrue daily, on the basis of a 365-day year. If payments
are made on time, my final payment will be in the amount of a regular monthly
payment. If payments are paid late, a greater portion of the payment will be
applied to accrued interest, a lesser portion (if any) will be applied to
principal reduction, and the loan will not amortize as originally scheduled,
resulting in a higher final payment amount. The interest rate I will pay will
be the rate I will pay both before and after any default.


 


4. Late
Charge. If the full
amount of any monthly payment is not made by the end of fifteen (15) calendar
days after its due date, I will pay you a late charge of                                .
I will pay this late charge promptly but only once on each late payment.


 


5. Waiver
of Defenses. Except
as otherwise provided in this Note, you are not responsible or liable to me for
the quality, safety, legality, or any other aspect of any property or services
purchased with the proceeds of the loan. If I have a dispute with any person
from whom I have purchased such property or services, I agree to settle the
dispute directly with that person.


 


6. Certification;
Exception to Waiver. I
certify that, to my knowledge, the proceeds of this loan will not be applied in
whole or part to purchase property or services from any person to whom any
interest this loan may be assigned. If, notwithstanding the preceding sentence,
any person from whom I have purchased such property acquires any interest in
this loan, then Paragraph 5 will not apply to the extent of that person’s
interest, even if that person later assigns that person’s interest to another
person.


 


7.
Method of Payment. I
will pay the principal, interest, and any late charges or other fees on this
loan when due. Those amounts are called “payments” in this Note. To ensure that
my payments are processed in a timely and efficient manner, you have given me
the choice of making my monthly payments (i) by automated withdrawal from an
account that I designate using an automated clearinghouse (ACH) or other
electronic fund transfer, or (ii) by bank drafts drawn by you on my behalf on
my account each month; and I have chosen one of these methods. If I close my
account or if my account changes or is otherwise inaccessible such that you are
unable to withdraw my payments from that account or draw bank drafts on the
account, I will 


 


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notify
you at least three (3) days prior to any such closure, change or
inaccessibility of my account, and authorize you to withdraw my payments from,
or draw bank drafts on, another account that I designate.


 


With
regard to payments made by automatic withdrawals from my account, I have the
right to (i) stop payment of a preauthorized automatic withdrawal, or (ii)
revoke my prior authorization for automatic withdrawals with regard to all
further loan payments, by notifying the financial institution where my account
is held, orally or in writing at least three (3) business days before the
scheduled date of the transfer. I agree to notify you in writing, at least
three (3) business days before the scheduled date of the transfer, of the
exercise of my right to stop a payment or to revoke my prior authorization for
further automatic withdrawals.


 


I understand that if I have elected to have my payments made by automatic withdrawals
from my account:


 


a.
The interest rate set forth in this Note, and the Annual Percentage Rate and related disclosures set forth in
my Truth-in-Lending Disclosure Statement include the one percent (1.00%) reduction in my interest
rate (the “Preferred Rate”) that I received as an incentive to make my payments
by preauthorized automatic withdrawals.


 


b. I will
no longer be eligible for the Preferred Rate, and I must make my monthly
payments using bank drafts drawn by you on my behalf on my account each month,
if (i) I withdraw my authorization to make payments by automatic withdrawals,
(ii) I cancel or close my account without establishing a new account at least three
(3) days before the next monthly payment due date, or (iii) on two
occasions during the term of this Note,
my entire monthly payment cannot be made by automatic withdrawal  from my
account on the due date because of insufficient funds in the account, or for
any other reason (other than an error by you).


 


c. If I
become ineligible for the Preferred Rate, you have the right to add one percent
(1.00%) to the interest rate on this Note.
If you exercise this right, the increased interest rate will become effective
on the due date of the next monthly payment due under this Note, and will
continue for the remainder of the term of the Note. The increase in the interest rate on my Note will result in a higher monthly
payment amount, equal to the amount that would be sufficient to repay in full
the unpaid principal I owe as of the effective date of the increased interest
rate, on the maturity date at the increased interest rate in substantially
equal monthly payments. I must pay the higher monthly payment amount beginning
on the first monthly payment due date after the increased interest rate becomes
effective.


 


d.
I understand that if the interest rate on my Note is increased as set forth in
this Paragraph, the Preferred Rate will not be reinstated for any reason, even
if I continue making my payments by automatic withdrawals.


 


8. Default and Remedies. If I fail to make any payment when due in
the manner required by Paragraph 7, or if receivership or insolvency
proceedings or any assignment for the benefit of creditors is instituted
by or against me; I die, I fail to keep any promise or meet any other
obligations in this Note, or I make a material misrepresentation in connection
with my loan, you may at your option accelerate the maturity of this Note and
declare all principal, interest and other charges due under this Note
immediately due and payable. If you exercise the remedy of acceleration you
will not do so until one or more payments under this Note is at least 120 days
past due, and you will give me at least 30 days prior notice of acceleration;
provided, however, that if my default is the result of a material
misrepresentation you do not need to wait until one or more payments is past
due, and you do not need to give me any prior notice of acceleration.


 


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9. Prepayments.
I may prepay this
loan in full or in part at any time without penalty.


 


10. Waivers.
You may accept late
payments or partial payments, even though marked “paid in full,” without losing
any rights under this Note, and you may delay enforcing any of your rights
under this Note without losing them. You do not have to (a) demand payment of
amounts due (known as “presentment”), (b) give notice that amounts due have not
been paid (known as “notice of dishonor”), or (c) obtain an official
certification of nonpayment (known as “protest”). I hereby waive presentment,
notice of dishonor and protest. Even if, at a time when I am in default, you do
not require me to pay immediately in full as described above, you will still
have the right to do so if I am in default at a later time. Neither your
failure to exercise any of your rights, nor your delay in enforcing or
exercising any of your rights, will waive those rights. Furthermore, if you
waive any right under this Note on one occasion, that waiver will not operate
as a waiver as to any other occasion.


 


11.
Insufficient Funds Charge. If I attempt to make a monthly payment, whether by check or bank draft
or by automated withdrawal from my designated account, and the payment is
unable to be made due to (i) insufficient funds in my account, (ii) the
closure, change or inaccessibility of my account without my having notified you
as provided in Paragraph 7, or (iii) for any other reason (other than an
error by you), I will pay you an
additional fee of $               
for each check or bank draft returned or failed automated withdrawal, unless
prohibited by applicable law.


 


12. Loan
Charges. If a law,
which applies to this loan and which sets maximum loan charges, is finally
interpreted so that the interest or other loan charges collected or to be
collected in connection with this loan exceed the permitted limits, then:
(a) any such loan charge shall be reduced by the amount necessary to
reduce the charge to the permitted limit; and (b) any sums already
collected from me which exceeded permitted limits will be refunded to me. You
may choose to make this refund by reducing the principal I owe under this Note
or by making a direct payment to me.


 


13.
Assignment. I may not
assign any of my obligations under this Note without your written
permission.  You do not have to give me your permission.  You may
assign this Note at any time without my permission. Unless prohibited by
applicable law, you may do so without telling me.  My obligations under
this Note apply to all of my heirs and permitted assigns. Your rights under
this Note apply to each of your successors and assigns.


 


14. Notices.
All notices and other
communications hereunder shall be given in writing and shall be deemed to have
been duly given and effective (i) upon receipt, if delivered in person or by
facsimile, email or other electronic transmission, or (ii) one day after
deposit prepaid for overnight delivery with a national overnight express
delivery service. Such notices must be properly addressed to the parties at the
addresses set forth below unless a different address for notice is later
provided in writing by giving notice pursuant to this Paragraph.


 


15. Governing Law. Except as provided below, this Note is governed by the laws of the
State of my residence, as reflected in your registration records, at the time
this loan is made. I will promptly notify you of any changes in my State of
residence. For borrowers who are residents of Alaska and Minnesota, this Note
is entered into in California and is governed by the laws of California, where
Prosper Marketplace, Inc. is located.


 


16. Miscellaneous. No provision of this Note shall be modified or limited except by a
written agreement signed by both you and me. The unenforceability of any
provision of this Note shall not affect the enforceability or validity of any
other provision of this Note.


 


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Arizona
Residents: Notice: I
understand that I may request that the initial disclosures prescribed in the Truth
in Lending Act (15 United States Code sections 1601 through 1666j) be provided
in Spanish before signing any loan documents.


 


Aviso Para Prestatarios En Arizona: Puedo
solicitar que las divulgaciones iniciales prescritas en la Ley  Truth
in Lending Act (15 Código de los Estados Unidos secciones 1601 hasta
1666j) sean proporcionadas en español antes de firmar cualesquiera documentos
de préstamos.


 


Missouri
Residents: Oral
agreements or commitments to loan money, extend credit or to forbear from
enforcing repayment of a debt including promises to extend or renew such debt
are not enforceable. To protect me (borrower) and you (creditor) from
misunderstanding or disappointment, any agreements we reach covering such
matters are contained in this writing, which is the complete and exclusive
statement of the agreement between us, except as we may later agree in writing
to modify it.


 


Texas
Residents: Prosper
Marketplace, Inc. is licensed and examined under the laws of the State of Texas
and by state law is subject to regulatory oversight by the Office of Consumer
Credit Commissioner. Any consumer wishing to file a complaint against the
Prosper Marketplace, Inc. should contact the Office of Consumer Credit
Commissioner through one of the means indicated below: In Person or U.S. Mail:
2601 North Lamar Boulevard, Austin, Texas 78705-4207. Telephone No.:
800/538-1579. Fax No.: 512/936-7610. E-mail:
consumer.complaints@occc.state.tx.us. Website: www.occc.state.tx.us.


 


Wisconsin
Residents:  If this loan is made for commercial purposes,
which are any purposes other than personal, family, or household purposes, this
loan shall be governed by the terms of the Consumer Loan Act, Wis. Stat.
chapters 421 to 427, including the provisions governing finance charges on
loans of $25,000 or less.


 


By
signing this Note, I acknowledge that I (i) have read and understand all
terms and conditions of this Note, (ii) agree to the terms set forth herein,
and (iii) acknowledge receipt of a completely filled-in copy of this Note.


 


 


Date:                                       


 


[Borrower]


 


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