Document:

PROMISSORY
NOTE

    

    
      	
              Borrower:

            	 
      	
              GARABED
      A. KHATCHOYAN

            	 
      	
              Lender:

            	 
      	
              THE
      VINYL FENCE COMPANY, INC.

            
	 
      	 
      	
              21942
      BAHAMAS

            	 
      	 
      	 
      	
              2210
      S. RITCHEY ST.

            
	 
      	 
      	
              MISSION
      VIEJO, CA 92692

            	 
      	 
      	 
      	
              SANTA
      ANA, CA 92701

            

    

    

    
      
        	
                Principal
      Amount: $250,000.00

              	
                Interest
      Rate: 5.000%

              	 
      	
                Date
      of Note: March 15, 2008

              

      

    

    

    PROMISE TO PAY.
Gordon Knott (“Borrower”) promises to pay The Vinyl Fence Company, Inc.
(“Lender”), or order, in lawful money of the United States of America, the
principal amount of TWO HUNDRED FIFTY THOUSAND & 00/100 Dollars
($250,000.00), or so much thereof as may be disbursed to , or for the benefit
of, the Borrower by the Lender in Lender’s sole and absolute discretion. It is
the intent of the Borrower and Lender hereunder to create a line of credit
agreement between Borrower and Lender whereby Borrower may borrow up to
$250,000.00 from Lender; provided, however, that Lender has no obligation to
lend Borrower any amounts hereunder and the decision to lend such money lies in
the sole and complete discretion of the Lender. Amounts advanced under this line
of credit shall accrue interest at the rate of 5. 0000% per annum on the unpaid
principal balance from the date of each individual borrowing, until each said
borrowing is paid in full.

    

    PAYMENT. Borrower will pay this loan
in one lump payment. The entire remaining outstanding balance of principal will
be due on March 15, 2009. Interest on this Note is computed on a 365/365
simple interest basis; that is, by applying the ration of the annual interest
rate over the number of days in a year, multiplied by the outstanding principal
balance, multiplied by the actual number of days the principal balance is
outstanding. All accrued interest shall be paid on December 31 of each calendar
year following the year of this note. Borrower will pay Lender at the Lender’s
address shown above or at such other place as Lender may designate in writing.
Unless otherwise agreed or required by applicable law, payments will be applied
first to accrued unpaid interest, then to principal, and any remaining amount to
any unpaid collection costs and late charges.

    

    PREPAYMENT. Borrower may pay
without penalty all or a portion of the amount owed earlier than it is due.
Early payments will not, unless agreed to by the Lender in writing, relive
Borrower of Borrower’s obligation to continue to make payments under the payment
schedule. Rather, they will reduce the principal; balance due and may result in
Borrower making fewer payments.

    

    DEFAULT. Borrower will be in
default if any of the following happens: (a) Borrower fails to make any
payment when due; (b)
Borrower breaks any promise Borrower has made to Lender, or Borrower
fails to comply with or to perform when due any other term, obligation,
covenant, or condition contained in this Note or any agreement related to this
Note, or in any other agreement to loan Borrower has with Lender; (c) Borrower becomes
insolvent, a receiver is appointed for any part of Borrower’s property, Borrower
makes an assignment for the benefit of creditors; or any proceeding is commenced
either by Borrower or against Borrower under any bankruptcy or insolvency laws.
(d) Any creditor tries
to take any of Borrower’s property on or in which Lender has a lien or security
interest. This includes a garnishment of any of Borrower’s accounts with
Lender.

    

    If any
default, other  than a default in payment, is curable and if Borrower
has not been given a notice of a breach of the same provision of this Note
within the preceding twelve (12) months, it may be cured (and no event of
default will have occurred) if Borrower, after receiving written notice from
Lender demanding cure of such default: (a) cures the default within fifteen (15)
days; or (b) if the cure requires more than fifteen (15) days, immediately
initiates steps which Lender deems in Lender’s sole discretion to be sufficient
to cure the default and thereafter continues and completes all reasonable and
necessary steps sufficient to produce compliance as soon as reasonable
practical.

    

    LENDER’S RIGHTS. Upon default,
Lender may declare the entire unpaid principal balance on this Note and all
accrued unpaid interest immediately due, without notice, and then Borrower will
pay that amount. Upon default, including failure to pay upon final maturity,
Lender, as its option, may also, if permitted under applicable law, increase the
interest rate on this Note 13. 000 percentage points. The interest rate will not
exceed the maximum rate permitted by applicable law. Lender may hire or pay
someone else to help collect this Note if Borrower does not pay. Borrower also
will pay Lender that amount. This includes, subject to any limits under
applicable law, Lender’s reasonable attorney’s fees and Lender’s legal expenses
whether or not there is a lawsuit, including reasonable attorney’s fees and
legal expenses for bankruptcy proceedings (includes efforts to modify or vacate
any automatic stay or injunction), appeals, and any anticipated post-judgment
collection services. If not prohibited by applicable law, Borrower also will pay
any court costs, in addition to all other sums provided by law. This Note has been delivered to
Lender and accepted by Lender in the State of California. If there is a lawsuit,
Borrower agrees upon Lender’s request to submit to the jurisdiction of the
courts of Orange County, the State of California. The Note shall be governed by
and construed in accordance with the laws of the State of
California.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    COLLATERAL. This Note is
unsecured.

    

    GENERAL PROVISIONS. Lender may
delay or forgo enforcing any of its rights or remedies under this Note without
losing. Borrower and any other person who signs, guarantees or endorses this
Note, to the extent allowed by law, waive presentment, demand fro payment,
protest and notice of dishonor. Upon any change in the terms of this Note, and
unless otherwise expressly stated in writing, no party who signs this Note,
whether as maker, guarantor, accommodation make or endorser, shall be released
from liability. All such parties agree that Lender may renew or extend
(repeatedly and for any length of time) this loan, or release any party or
guarantor or collateral; or impair, fail to realize upon or perfect Lender’s
security interest in the collateral; and take any thither action deemed
necessary by Lender without the consent of or notice to anyone. All such parties
also agree that Lender may modify this loan without the consent of or notice to
anyone other than the party with whom the modification is made. Th obligations
under this Note are joint and several.

    

    PRIOR TO
SIGNING THIS NOTE, EACH BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS
NOT. EACH BORROWER AGREES TO THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A
COMPLETED COPY OF THE NOTE.

    

    
      	
              BORROWER.

            	 
      
	 
      	 
      
	
              /s/ Garabed Khatchoyan

            	 
      
	
              Garabed
      KhatchoyanPROMISSORY
NOTE

    

    
      
        
          
            	
                    Borrower:

                  	
                    GARABED
      A. KHATCHOYAN

                  	 
      	
                    Lender:

                  	
                    THE
      VINYL FENCE COMPANY, INC.

                  
	 
      	
                    21942
      BAHAMAS

                  	 
      	 
      	
                    2210
      S. RITCHEY ST.

                  
	 
      	
                    MISSION
      VIEJO, CA 92692

                  	 
      	 
      	
                    SANTA
      ANA, CA 92701

                  

          

        

      

    

    

    
      
        	
                Principal
      Amount: $250,000.00

              	
                Interest
      Rate: 5.000%

              	
                Date
      of Note: March 15, 2008

              

      

    

    

    PROMISE TO PAY.
Gordon Knott (“Borrower”) promises to pay The Vinyl Fence Company, Inc.
(“Lender”), or order, in lawful money of the United States of America, the
principal amount of TWO HUNDRED FIFTY THOUSAND & 00/100 Dollars
($250,000.00), or so much thereof as may be disbursed to , or for the benefit
of, the Borrower by the Lender in Lender’s sole and absolute discretion. It is
the intent of the Borrower and Lender hereunder to create a line of credit
agreement between Borrower and Lender whereby Borrower may borrow up to
$250,000.00 from Lender; provided, however, that Lender has no obligation to
lend Borrower any amounts hereunder and the decision to lend such money lies in
the sole and complete discretion of the Lender. Amounts advanced under this line
of credit shall accrue interest at the rate of 5. 0000% per annum on the unpaid
principal balance from the date of each individual borrowing, until each said
borrowing is paid in full.

    

    PAYMENT. Borrower will pay this loan
in one lump payment. The entire remaining outstanding balance of principal will
be due on March 15, 2009. Interest on this Note is computed on a 365/365
simple interest basis; that is, by applying the ration of the annual interest
rate over the number of days in a year, multiplied by the outstanding principal
balance, multiplied by the actual number of days the principal balance is
outstanding. All accrued interest shall be paid on December 31 of each calendar
year following the year of this note. Borrower will pay Lender at the Lender’s
address shown above or at such other place as Lender may designate in writing.
Unless otherwise agreed or required by applicable law, payments will be applied
first to accrued unpaid interest, then to principal, and any remaining amount to
any unpaid collection costs and late charges.

    

    PREPAYMENT. Borrower may pay
without penalty all or a portion of the amount owed earlier than it is due.
Early payments will not, unless agreed to by the Lender in writing, relive
Borrower of Borrower’s obligation to continue to make payments under the payment
schedule. Rather, they will reduce the principal; balance due and may result in
Borrower making fewer payments.

    

    DEFAULT. Borrower will be in
default if any of the following happens: (a) Borrower fails to make any
payment when due; (b)
Borrower breaks any promise Borrower has made to Lender, or Borrower
fails to comply with or to perform when due any other term, obligation,
covenant, or condition contained in this Note or any agreement related to this
Note, or in any other agreement to loan Borrower has with Lender; (c) Borrower becomes
insolvent, a receiver is appointed for any part of Borrower’s property, Borrower
makes an assignment for the benefit of creditors; or any proceeding is commenced
either by Borrower or against Borrower under any bankruptcy or insolvency laws.
(d) Any creditor tries
to take any of Borrower’s property on or in which Lender has a lien or security
interest. This includes a garnishment of any of Borrower’s accounts with
Lender.

    

    If any
default, other  than a default in payment, is curable and if Borrower
has not been given a notice of a breach of the same provision of this Note
within the preceding twelve (12) months, it may be cured (and no event of
default will have occurred) if Borrower, after receiving written notice from
Lender demanding cure of such default: (a) cures the default within fifteen (15)
days; or (b) if the cure requires more than fifteen (15) days, immediately
initiates steps which Lender deems in Lender’s sole discretion to be sufficient
to cure the default and thereafter continues and completes all reasonable and
necessary steps sufficient to produce compliance as soon as reasonable
practical.

    

    LENDER’S RIGHTS. Upon default,
Lender may declare the entire unpaid principal balance on this Note and all
accrued unpaid interest immediately due, without notice, and then Borrower will
pay that amount. Upon default, including failure to pay upon final maturity,
Lender, as its option, may also, if permitted under applicable law, increase the
interest rate on this Note 13. 000 percentage points. The interest rate will not
exceed the maximum rate permitted by applicable law. Lender may hire or pay
someone else to help collect this Note if Borrower does not pay. Borrower also
will pay Lender that amount. This includes, subject to any limits under
applicable law, Lender’s reasonable attorney’s fees and Lender’s legal expenses
whether or not there is a lawsuit, including reasonable attorney’s fees and
legal expenses for bankruptcy proceedings (includes efforts to modify or vacate
any automatic stay or injunction), appeals, and any anticipated post-judgment
collection services. If not prohibited by applicable law, Borrower also will pay
any court costs, in addition to all other sums provided by law. This Note has been delivered to
Lender and accepted by Lender in the State of California. If there is a lawsuit,
Borrower agrees upon Lender’s request to submit to the jurisdiction of the
courts of Orange County, the State of California. The Note shall be governed by
and construed in accordance with the laws of the State of
California.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    COLLATERAL. This Note is
unsecured.

    

    GENERAL PROVISIONS. Lender may
delay or forgo enforcing any of its rights or remedies under this Note without
losing. Borrower and any other person who signs, guarantees or endorses this
Note, to the extent allowed by law, waive presentment, demand fro payment,
protest and notice of dishonor. Upon any change in the terms of this Note, and
unless otherwise expressly stated in writing, no party who signs this Note,
whether as maker, guarantor, accommodation make or endorser, shall be released
from liability. All such parties agree that Lender may renew or extend
(repeatedly and for any length of time) this loan, or release any party or
guarantor or collateral; or impair, fail to realize upon or perfect Lender’s
security interest in the collateral; and take any thither action deemed
necessary by Lender without the consent of or notice to anyone. All such parties
also agree that Lender may modify this loan without the consent of or notice to
anyone other than the party with whom the modification is made. Th obligations
under this Note are joint and several.

    

    PRIOR TO
SIGNING THIS NOTE, EACH BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS
NOT. EACH BORROWER AGREES TO THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A
COMPLETED COPY OF THE NOTE.

    

    BORROWER.

    

    
      
        
          	
                  /s/ Garabed Khatchoyan

                	 
      
	
                  Garabed
      Khatchoyan

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