Common use of Terms of the Note Clause in Contracts

Terms of the Note. 2.1 Beginning on the date this Note is issued, this Note shall bear interest at the noncompounded rate of ten percent (10%) per annum on the outstanding principal balance hereof. The Company shall pay all accrued interest thereon on a semi-annual basis, such payments to be made on March 31 and September 30 of each year (each an “Interest Payment Date”) until the earlier of (a) such time as the principal balance of the Note shall be paid in full or (b) the conversion of this Note pursuant to Section 6 hereof. Interest will be computed on the basis of a year of 365 days for the number of days actually elapsed. The Holder may elect, upon written notice to the Company provided at least 30 days prior to each Interest Payment Date, to waive the payment of accrued interest in cash and, instead, to add such accrued interest to the outstanding principal balance of this Note. Each such increase in the outstanding principal balance of this Note shall be effective as of the applicable Interest Payment Date and shall accrue interest pursuant to this Section 2.1. In the absence of a valid election by the Holder, accrued interest will be payable in cash. 2.2 The then outstanding principal balance of this Note, together with any accrued but unpaid interest thereon, shall be payable in full on the Maturity Date. 2.3 If any payment becomes due and payable under this Note on a Saturday, Sunday or legal holiday, the maturity thereof shall be extended to the next succeeding business day. 2.4 The entire outstanding principal balance of this Note, together with all accrued but unpaid interest thereon, shall become due and payable upon the consummation of either (a) a reorganization, merger or consolidation of the Company (any of the foregoing, a “Merger”), in each case, with respect to which all or substantially all of the individuals and entities who were the beneficial owners of the outstanding Common Stock immediately prior to such Merger do not, following such Merger, beneficially own, directly or indirectly, more than 50% of the then outstanding shares of voting stock of the corporation resulting from the Merger, or (b) the sale or other disposition of all or substantially all of the assets of the Company, excluding a sale or other disposition of assets to a subsidiary of the Company. For purposes of the foregoing, in no event shall the sale or other disposition of all or any portion of the Company’s Green Tech Products business (whether by merger, sale of stock, sale of assets or otherwise) be deemed to be a sale or disposition of substantially all of the Company’s assets. Except as set forth in the preceding sentence, however, this Note may not be prepaid, in whole or in part, prior to the Maturity Date, without the consent of the Holder.