SHALL CONSTITUTE AN EVENT OF
DEFAULT ("EVENT OF DEFAULT") HEREUNDER.
4.2
DEFAULT INTEREST.
FOLLOWING THE OCCURRENCE
AND DURING THE CONTINUANCE OF AN EVENT OF DEFAULT, THE COMPANIES SHALL, JOINTLY
AND SEVERALLY, PAY ADDITIONAL INTEREST ON THE OUTSTANDING PRINCIPAL BALANCE OF
THIS NOTE IN AN AMOUNT EQUAL TO ONE AND ONE-HALF PERCENT (1.5%) PER MONTH, AND
ALL OUTSTANDING OBLIGATIONS, INCLUDING UNPAID INTEREST, SHALL, TO THE EXTENT
PERMITTED BY LAW, CONTINUE TO ACCRUE INTEREST AT SUCH ADDITIONAL INTEREST RATE
FROM THE DATE OF SUCH EVENT OF DEFAULT UNTIL THE DATE SUCH EVENT OF DEFAULT IS
CURED OR WAIVED.
4.3
DEFAULT PAYMENT.
FOLLOWING THE OCCURRENCE
AND DURING THE CONTINUANCE OF AN EVENT OF DEFAULT, THE HOLDER, AT ITS OPTION,
MAY ELECT, IN ADDITION TO ALL RIGHTS AND REMEDIES OF THE HOLDER UNDER THE
SECURITY AGREEMENT AND THE ANCILLARY AGREEMENTS AND ALL OBLIGATIONS OF EACH
COMPANY UNDER THE SECURITY AGREEMENT AND THE ANCILLARY AGREEMENTS, TO REQUIRE
THE COMPANIES, JOINTLY AND SEVERALLY, TO MAKE A DEFAULT PAYMENT ("DEFAULT
PAYMENT").
THE DEFAULT PAYMENT SHALL BE 120% OF THE OUTSTANDING PRINCIPAL
AMOUNT OF THE NOTE, PLUS ACCRUED BUT UNPAID INTEREST, ALL OTHER FEES THEN
REMAINING UNPAID, AND ALL OTHER AMOUNTS PAYABLE HEREUNDER.
THE DEFAULT PAYMENT
SHALL BE APPLIED FIRST TO ANY FEES DUE AND PAYABLE TO THE HOLDER PURSUANT TO THE
NOTES AND/OR THE ANCILLARY AGREEMENTS, THEN TO ACCRUED AND UNPAID INTEREST DUE
ON THE NOTES, THE SECURITY AGREEMENT AND THEN TO THE OUTSTANDING PRINCIPAL
BALANCE OF THE NOTES.
THE DEFAULT PAYMENT SHALL BE DUE AND PAYABLE IMMEDIATELY
ON THE DATE THAT THE HOLDER HAS EXERCISED ITS RIGHTS PURSUANT TO THIS
SECTION 4.3.
7
ARTICLE V
MISCELLANEOUS
5.1
CONVERSION PRIVILEGES.
THE CONVERSION
PRIVILEGES SET FORTH IN ARTICLE III SHALL REMAIN IN FULL FORCE AND EFFECT
IMMEDIATELY FROM THE DATE HEREOF UNTIL THE DATE THIS NOTE IS INDEFEASIBLY PAID
IN FULL AND IRREVOCABLY TERMINATED.
5.2
CUMULATIVE REMEDIES.
THE REMEDIES UNDER
THIS NOTE SHALL BE CUMULATIVE.
5.3
FAILURE OR INDULGENCE NOT WAIVER.
NO
FAILURE OR DELAY ON THE PART OF THE HOLDER HEREOF IN THE EXERCISE OF ANY POWER,
RIGHT OR PRIVILEGE HEREUNDER SHALL OPERATE AS A WAIVER THEREOF, NOR SHALL ANY
SINGLE OR PARTIAL EXERCISE OF ANY SUCH POWER, RIGHT OR PRIVILEGE PRECLUDE OTHER
OR FURTHER EXERCISE THEREOF OR OF ANY OTHER RIGHT, POWER OR PRIVILEGE.
ALL
RIGHTS AND REMEDIES EXISTING HEREUNDER ARE CUMULATIVE TO, AND NOT EXCLUSIVE OF,
ANY RIGHTS OR REMEDIES OTHERWISE AVAILABLE.
5.4
NOTICES.
ANY NOTICE HEREIN REQUIRED OR
PERMITTED TO BE GIVEN SHALL BE IN WRITING AND SHALL BE PROVIDED IN ACCORDANCE
WITH THE TERMS OF THE SECURITY AGREEMENT.
5.5
AMENDMENT PROVISION.
THE TERM "NOTE" AND
ALL REFERENCES THERETO, AS USED THROUGHOUT THIS INSTRUMENT, SHALL MEAN THIS
INSTRUMENT AS ORIGINALLY EXECUTED, OR IF LATER AMENDED OR SUPPLEMENTED, THEN AS
SO AMENDED OR SUPPLEMENTED, AND ANY SUCCESSOR INSTRUMENT AS SUCH SUCCESSOR
INSTRUMENT MAY BE AMENDED OR SUPPLEMENTED.
5.6
ASSIGNABILITY.
THIS NOTE SHALL BE BINDING
UPON EACH COMPANY AND ITS SUCCESSORS AND ASSIGNS, AND SHALL INURE TO THE BENEFIT
OF THE HOLDER AND ITS SUCCESSORS