Lexaria Corp: Exhibit 10.4 - Filed by newsfilecorp.com






Exhibit 10.4

DEMAND LOAN AGREEMENT 

THIS AGREEMENT made the 13th day of September, 2010


AMONG: 

CAB Financial Services Ltd.

5774 Deadpine Drive 
Kelowna, BC V1P 1A3 
Fax 250 765 4408



(herein called the “Lender”) 

OF THE FIRST PART 

AND: 

LEXARIA CORP., of
950 – 1130
West Pender Street,
Vancouver BC V6E 4A4,
Fax 604 602 1625 


(herein called the “Company”) 

OF THE SECOND PART 

WHEREAS: 

A.                    This
Demand Loan Agreement (the “Loan Agreement”) is entered into this date by and
between the Lender and the Company payable on demand. 

B.                    
The purpose of this Loan Agreement is to set out terms of the
arrangement by which Lender agrees to make a loan of US$90,000 (“Loan”)
available to the Company.

1.                     
DEFINITIONS 

1.1                     “Indebtedness”
means all loans and advances made or which may be made by the Lender to the
Company and Interest thereon and all costs, charges and expenses of or incurred
by the Lender in connection with any Securities and in connection with any
property covered by or comprised in the Securities, whether in protecting,
preserving, realizing or collecting any Securities or property aforesaid or
attempting so to do or otherwise and all other obligations and liabilities,
present or future, direct or indirect, absolute or contingent, mature or not, of
the Company to the Lender arising under or by virtue of this Agreement, the
Securities or otherwise howsoever. 

1.2                     “Interest”
will be at 12%. 

1.3                     “Principal”
means the aggregate principal amount of money loaned to the Company by the
Lender of US$90,000 dollars. 




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1.4                    “Securities”
means the securities referred to in Article 3 or any renewal thereof or
substitution therefore. 

2.                     TERMS
OF THE LOAN 

2.1                    The
Lender will lend to the Company, and the Company will borrow from the Lender by
way of one advance to be evidenced by a promissory note in the form attached
hereto as Schedule “A”, the Principal sum of ninety thousand dollars (US)
subject to the terms and conditions of this Agreement and the Securities. 

2.2                    For
value received, Company promises to pay to Lender on the demand from the date of
this Loan Agreement (the “Maturity Date”) the amount of the Principal which has
been advanced hereunder and remains outstanding from the date of funding.

2.3                    Notwithstanding
the above the Company may repay at any time any or all of the Principal then
outstanding and accrued and unpaid Interest on giving 20 days notice to the
Lender. In this event, the Company may elect to repay the Principal at any time
in advance of the Maturity Date. 

3.                     SECURITY
FOR THE LOAN 

3.1                    The
loan shall be unsecured.

4.                    
AFFIRMATIVE COVENANTS OF THE COMPANY 

4.1                    At
all times while any Principal or Interest on the Loan is outstanding, the
Company will: 

	 	(a) 	
      maintain the properties and assets being the subject of
      the Securities in good repair;

	 	 	 
	 	(b) 	
      keep true records and books of account in which full,
      true and correct entries will be made in accordance with generally
      accepted accounting principles consistently applied throughout the period
      involved, and maintain adequate accounts and reserves for all taxes,
      including taxes on income and profits, all depreciation and amortization
      of his properties and assets and all such other reserves for contingencies
      as would normally be required in accordance with generally accepted
      accounting principles;

	 	 	 
	 	(c) 	
      permit any representative of the Lender to visit and
      inspect the properties charged by the Securities and to examine the
      Company’s books, records, leases and other documents relating thereto and
      to enquire from time to time as to particulars of any of the foregoing,
      all at such times and so often as may reasonably be requested;
  and

	 	 	 
	 	(d) 	
      forthwith upon request of the Lender execute and deliver
      to the Lender all such further and other mortgages, deeds, documents,
      matters, acts, things and insurances in law (collectively, the “Ancillary
      Items”) for the purpose of record or otherwise which the Lender may reasonably require to perfect
the intentions and provisions of this Agreement; provided that the Company will
not be obligated to execute and deliver any Ancillary Items where the execution
and delivery of such Ancillary Items would breach the terms and conditions of
any lease of real property existing on the date hereof to which the Company is a
party. 







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5.                     
DEFAULT 

5.1                    Default
by the Company. The occurrence of one or more of the following events shall
constitute an “event of default”, namely: 

	 	(a) 	
      if the Company fails to make payment of the Indebtedness
      or any part thereof as and when the same comes due and payable;

	 	 	 
	 	(b) 	
      if any representation or warranty contained herein or
      otherwise made in writing to the Lender in connection with any of the
      transactions contemplated by this Agreement is found to be false or
      misleading or incorrect in any material respect on the date which it was
      made;

	 	 	 
	 	(c) 	
      if the Company defaults in the performance of or
      compliance with any term, covenant or agreement contained in this
      Agreement or in any of the Securities and the default is not remedied
      within twenty (20) days after notice thereof has been given to the
      Company;

	 	 	 
	 	(d) 	
      the entry of a decree or order for relief by a court
      having jurisdiction in respect of the Company in an involuntary case under
      the federal bankruptcy laws, as now or hereafter constituted, or any other
      applicable federal or state bankruptcy, insolvency or other similar
      laws;

	 	 	 
	 	(e) 	
      the commencement by the Company of a voluntary case under
      the federal bankruptcy laws, as now or hereafter constituted, or any other
      applicable federal or state bankruptcy, insolvency or other similar
      laws;

	 	 	 
	 	(f) 	
      the appointment of a receiver, liquidator, assignee,
      custodian, trustee, sequestrator (or similar official) of the Company or
      for any material part of the Company’s property;

	 	 	 
	 	(g) 	
      the consent by the Company to the appointment of, or
      taking possession by, a receiver, liquidator, assignee, custodian,
      trustee, sequestrator (or similar official) of the Company or for any
      material part of the Company’s property;

	 	 	 
	 	(h) 	
      the issuance of an order for the winding up or
      liquidation of the affairs of the Company and the continuance of such
      decree, order or appointment unstayed and in effect for a period of sixty
      (60) consecutive days;

	 	 	 
	 	(i) 	
      the making by the Company of an assignment for the
      benefit of its creditors;







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	 	(j) 	
      the institution by or against the Company of any formal
      or informal proceeding for the dissolution or liquidation of, settlement
      of claims against or winding-up of the affairs of the Company;

	 	 	 
	 	(k) 	
      the threat by the Company of ceasing to carry on business
      or the Company ceasing to carry on business;

	 	 	 
	 	(l) 	
      the entry of a decree or order or an effective resolution
      passed for winding-up the Company;

	 	 	 
	 	(m) 	
      the entry by the Company into any reconstruction,
      reorganization, amalgamation, merger or other similar arrangement with any
      other person; or

	 	 	 
	 	(n) 	
      if any encumbrancer takes possession of the properties
      being the subject of the Securities or being financed with the Loan,
      unless the Company in good faith dispute the encumbrancer’s claim and
      non-payment does not jeopardize the title of the Company to any such
      property or any way impairs any of the Securities;
or



5.2                     Upon
the occurrence of any one of these events of default, the entire amount of the
Principal and Interest then outstanding shall immediately become due and
payable. 

5.3                     Lender’s
delay or failure to insist upon the strict performance of the Company’s
obligations under this Loan Agreement or the Securities shall not be construed
as a waiver of Lender’s right to later require strict performance nor as a
waiver of any of Lender’s legal and equitable remedies. 

6.                    
 PAYMENT ON MATURITY 

6.1                     On
the Maturity Date, the Company will deliver the Principal then outstanding and
any earned Interest due Lender by wire transfer to Lender’s nominated bank
account or in cash or certified cheque delivered to the address of Lender. 

7.                     NOTICES


7.1                    Any
notice, request, demand, claim, instruction, or other document to be given to
any party pursuant to this Loan Agreement shall be in writing delivered
personally or sent by mail, registered or certified, postage fully prepaid, as
follows: 

	(a) 	
      If to, Lender to the address set forth on the first page
      of this Loan Agreement.

	 	 
	(b) 	
      If to Company, to the addresses set forth on the first
      page of this Loan Agreement, with a copy to:



Madonald Tuskey, Corporate and
Securities Lawyers 
1210 – 777 Hornby Street
Vancouver, British
Columbia V6Z 1S4 
Attention: William L. Macdonald 
Fax: 604 681
4760 





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7.2                     Any
party may give any notice, request, demand, claim, instruction, or other
document under this section using any other means (including expedited courier,
messenger service, telecopy, facsimile, telex, ordinary mail, or electronic
mail), but no such notice, request, demand, claim, instruction, or other
document shall be deemed to have been duly given unless and until it actually is
received by the individual for whom it is intended. Any party may change its
address for purposes of this section by giving notice of the change of address
to the other party in the manner provided in this section. 

8.                     TERMINATION


8.1                    This
Loan Agreement may, by written notice, be terminated as follows: 

	 	(a) 	
      by either the Company or the Lender if a material breach
      of any provision of this Loan Agreement has been committed by the other
      party and such breach has not been waived; or

	 	 	 
	 	(b) 	
      by mutual written consent of the Company and
    Lender.



8.2                     Each
Party’s right of termination is in addition to any other rights it may have
under this Loan Agreement or otherwise, and the exercise of a right of
termination will not be an election of remedies; provided, however, that if this
Loan Agreement is terminated by a party because of a breach of the Loan
Agreement by the other party or because one or more of the conditions to the
terminating party’s obligations under this Loan Agreement is not satisfied as a
result of the other party’s failure to comply with its obligations under this
Loan Agreement, the terminating party’s right to pursue all legal remedies will
survive such termination unimpaired. For greater certainty, termination of this
Loan Agreement does not release the Company from its obligations hereunder in
respect of any Principal then outstanding. 

9.                     INDEMNIFICATION


9.1                    All
representations, warranties, covenants, and obligations in this Loan Agreement,
and any other certificate or document delivered pursuant to this Loan Agreement
will survive the Loan Agreement. The right to indemnification, payment of
damages or other remedy based on such representations, warranties, covenants,
and obligations will not be affected by any investigation conducted with respect
to, or any knowledge acquired (or capable of being acquired) at any time,
whether before or after the execution and delivery of this Loan Agreement, with
respect to the accuracy or inaccuracy of or compliance with, any such
representation, warranty, covenant, or obligation. The waiver of any condition
based on the accuracy of any representation or warranty, or on the performance
of or compliance with any covenant or obligation, will not affect the right to
indemnification, payment of damages, or other remedy based on such
representations, warranties, covenants, and obligations. 

9.2                    The
Company and the Lender mutually agree to indemnify and hold each other harmless
along with their respective representatives, stockholders, controlling persons,
and affiliates (collectively, the “Indemnified Persons”) for, and will pay to
the Indemnified Persons the amount of, any loss, liability, claim, damage
(including incidental and consequential damages), expense (including costs of
investigation and defense and reasonable attorneys’ fees) or diminution of
value, whether or not involving a third-party claim, arising, directly or indirectly, from or in connection with any breach of any
representation, warrant, covenant or obligation made by the other Party in this
Loan Agreement.




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10.                     GENERAL
PROVISIONS 

10.1                     The
Parties agree to furnish upon request to each other such further information,
and to execute and deliver to each other such other documents, and to do such
other acts and things, all as the other party may reasonably request for the
purpose of carrying out the intent of this Loan Agreement. 

10.2                     The
rights and remedies of the parties to this Loan Agreement are cumulative and not
alternative. Neither the failure nor any delay by any party in exercising any
right, power, or privilege under this Loan Agreement or the documents referred
to in this Loan Agreement will operate as a waiver of such right, power, or
privilege, and no single or partial exercise of any such right, power, or
privilege will preclude any other or further exercise of such right, power, or
privilege or the exercise of any other right, power, or privilege. To the
maximum extent permitted by applicable law, (a) no claim or right arising out of
this Loan Agreement or the documents referred to in this Loan Agreement can be
discharged by one party, in whole or in part, by a waiver or renunciation of the
claim or right unless in writing signed by the other party; (b) no waiver that
may be given by a party will be applicable except in the specific instance for
which it is given; and (c) no notice to or demand on one party will be deemed to
be a waiver of any obligation of such party or of the right of the party giving
such notice or demand to take further action without notice or demand as
provided in this Loan Agreement or the documents referred to in this Loan
Agreement. 

10.3                     This
Loan Agreement supersedes all prior agreements between the parties with respect
to this loan and constitutes (along with the documents referred to in this Loan
Agreement) a complete and exclusive statement of the terms of the agreement
between the parties with respect to its subject matter. This Loan Agreement may
not be amended except by a written agreement executed by the party to be charged
with the amendment. 

10.4                     Neither
party may assign any of its rights under this Loan Agreement without the prior
consent of the other parties. This Loan Agreement will apply to, be binding in
all respects upon, and inure to the benefit of the successors and permitted
assigns of the parties. Nothing expressed or referred to in this Loan Agreement
will be construed to give any Person other than the parties to this Loan
Agreement any legal or equitable right, remedy, or claim under or with respect
to this Loan Agreement or any provision of this Loan Agreement. This Loan
Agreement and all of its provisions and conditions are for the sole and
exclusive benefit of the parties to this Loan Agreement and their successors and
assigns. 

10.5                     If
any provision of this Loan Agreement is held invalid or unenforceable by any
court of competent jurisdiction, the other provisions of this Loan Agreement
will remain in full force and effect. Any provision of this Loan Agreement held
invalid or unenforceable only in part or degree will remain in full force and
effect to the extent not held invalid or unenforceable. 

10.6                     This
Loan Agreement will be governed by the laws of the Province of British Columbia.





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10.7                     This
Loan Agreement may be signed in as many counterparts is as necessary and all
signatures so executed shall constitute one Agreement, binding on all Parties as
if each was a signatory on the original. 

11.                     SIGNATURES


11.1                     IN
WITNESS WHEREOF, the parties have executed and delivered this Loan Agreement as
of the date first written above. 

 

CAB Financial Services Ltd. 

Per:
__________________________________
        
Chris Bunka Authorized Signatory 

 

LEXARIA CORP. 

Per:
__________________________________
       
Bal Bhullar, CFO and Authorized Signatory 




SCHEDULE “A” 

PROMISSORY NOTE 

	US$90,000 	September 13, 2010 


FOR VALUE RECEIVED, the undersigned (the “Borrower”) promise to
pay to CAB Financial Services Ltd. of 5774 Deadpine Drive, Kelowna B.C. V1P 1A3
Canada, (the “Lender”) the principal sum of ninety thousand US dollars
(US$90,000) in lawful currency of the US (the “Principal Sum”), as herein
provided.

The Principal Sum or such amount as shall remain outstanding
from time to time shall bear 12% interest thereon, both before and after each of
maturity, default and judgment commencing on the day the Principal Sum is
advanced by the Lender to the Borrower.

The Principal Sum aforesaid will become due and payable on
demand. 

Extension of time of payment of all or any part of the amount
owing hereunder at any time or times and failure of the Lender to enforce any of
its rights or remedies hereunder shall not release the Borrower from its
obligations hereunder or constitute a waiver of the rights of the Lender to
enforce any rights and remedies therein. 

On default in payment of any sum due hereunder for the
Principal Sum or Interest or after 15 days’ notice of Default to the Borrower
upon the occurrence of an Event of Default as defined pursuant to the Demand
Loan Agreement, entered into between the Borrower and the Lender and dated for
reference September 13, 2010, or any amendments thereto, the unpaid balance of
the Principal Sum and all accrued Interest thereon shall at the option of the
Lender forthwith become due and payable. 

The undersigned, when not in default hereunder, will have the
privilege of prepaying in whole or in part the Principal Sum, upon 20 days’
notice to the Lender. 

Presentment, protest, notice of protest and notice of dishonour
are hereby waived. 

LEXARIA CORP. 

Per:
__________________________________
       
Bal Bhullar, Authorized Signatory