DEFAULT AND DEFAULT RELATED PROVISIONS
3.1
EVENTS OF DEFAULT.
THE OCCURRENCE OF AN EVENT OF DEFAULT UNDER
THE SECURITY AGREEMENT SHALL CONSTITUTE AN EVENT OF DEFAULT ("EVENT OF DEFAULT")
HEREUNDER.
3.2
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 TWO PERCENT (2%) PER MONTH, AND ALL OUTSTANDING OBLIGATIONS,
INCLUDING UNPAID INTEREST, SHALL 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.
3.3
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 OTHER ANCILLARY AGREEMENTS AND ALL OBLIGATIONS AND LIABILITIES OF EACH
COMPANY UNDER THE SECURITY AGREEMENT AND THE OTHER ANCILLARY AGREEMENTS, TO
REQUIRE THE COMPANIES, JOINTLY AND SEVERALLY, TO MAKE A DEFAULT PAYMENT
("DEFAULT PAYMENT").
THE DEFAULT PAYMENT SHALL BE ONE HUNDRED THIRTY PERCENT
(130%) 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, THE SECURITY AGREEMENT AND/OR THE
ANCILLARY AGREEMENTS, THEN TO ACCRUED AND UNPAID INTEREST DUE ON THE NOTES 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 3.3.
ARTICLE IV
MISCELLANEOUS
4.1
CUMULATIVE REMEDIES.
THE REMEDIES UNDER THIS NOTE SHALL BE
CUMULATIVE.
4.2
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.
4.3
NOTICES.
ANY NOTICE HEREIN REQUIRED OR PERMITTED TO BE GIVEN
SHALL BE IN WRITING AND SHALL BE DEEMED EFFECTIVE GIVEN (A) UPON PERSONAL
DELIVERY TO THE PARTY NOTIFIED, (B)
2
WHEN SENT BY CONFIRMED TELEX OR FACSIMILE IF SENT DURING NORMAL BUSINESS HOURS
OF THE RECIPIENT, IF NOT, THEN ON THE NEXT BUSINESS DAY, (C) FIVE DAYS AFTER
HAVING BEEN SENT BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED,
POSTAGE PREPAID, OR (D) ONE DAY AFTER DEPOSIT WITH A NATIONALLY RECOGNIZED
OVERNIGHT COURIER, SPECIFYING NEXT DAY DELIVERY, WITH WRITTEN VERIFICATION OF
RECEIPT.
ALL COMMUNICATIONS SHALL BE SENT TO THE RESPECTIVE COMPANY AT THE
ADDRESS PROVIDED FOR SUCH COMPANY IN THE SECURITY AGREEMENT EXECUTED IN
CONNECTION HEREWITH, AND TO