Name of
Investor:
200 Queens Quay
E Unit #1
Toronto,
Ontario, Canada M5A 4K9
ELEMENT 21
BRIDGE LOAN TERMS
CONVERTIBLE NOTE
$ 300,000 US
FOR VALUE RECEIVED, the undersigned, ELEMENT 21 GOLF COMPANY,
a Delaware corporation (the “Borrower” ), hereby
promises to pay to the order of , (the
“Lender” ), the principal amount of Three
Hundred Thousand Dollars ($ 300,000).
Section
1. The Note . The $ 300,000 loan shall take the form of
a 7% Convertible Promissory Note which shall be repaid in a
period of not more than 6 months from the date of
origination.
Section
2. Interest . All indebtedness outstanding under this Note
shall bear interest (computed on the basis of a 360-day year) at
the rate of seven percent (7%) per annum commencing from the date
of this Note. Interest shall be payable on the Maturity
Date.
Section
3. Prepayment . This Note or any part of the principal amount
hereof (in denominations of ten thousand dollars ($10,000) or
multiples thereof) may be prepaid by the Borrower without penalty,
premium or prior notice, however, the right of conversion remains
with the lender for the full period of six months one.
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The outstanding
principal, at the option of the Lender, can be converted anytime
during the six months, on terms and conditions applicable thereto
at a conversion price equal to 45 cents per
share.
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If the Lender
desires to exercise its conversion rights during 6 months period,
the Lender shall surrender his Note, duly endorsed, at the
principal office of the Company and shall give written notice to
the Borrower of his election to convert the outstanding principal
hereon into Equity Securities. The notice shall state the name(s)
of the nominee(s) of the Lender in which any Equity Securities are
to be issued. The Company shall, as soon as practicable thereafter,
issue and deliver at such office to the Lender or such nominee(s),
a certificate or certificates for the number of Equity Shares to
which the Lender or such nominee(s) is entitled.
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No fractional
shares shall be issued upon conversion of this Note. Instead of
issuing any fractional shares that would otherwise be issuable upon
conversion of this Note (or any portion hereof), the Borrower shall
round up to the nearest whole number of shares and pay to the
Lender cash in an amount equal to the amount of such fractional
interest.
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In addition
under the choice of conversion, Lender again retains the right to
convert at the price per share of 45 c
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