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EXHIBIT 4.04
FORM OF
REVOLVING CREDIT LOAN AGREEMENT
THIS
REVOLVING CREDIT LOAN AGREEMENT (the "Agreement"), is made this
___
day of ________, 2005, by and between U.S.
MedSys Corp. ("Borrower"), and
____________ ("Lender").
WHEREAS,
Borrower is desirous of borrowing sums from time to time up to
an
aggregate amount of One Hundred Thousand
Dollars ($100,000) from Lender in the
form of a revolving line of credit; and
WHEREAS,
Lender is willing to provide the above-described loans to
Borrower on the terms and conditions
hereinafter set forth.
NOW,
THEREFORE, in consideration of the foregoing and the mutual
covenants
herein contained, the parties agree as
follows:
1. Terms
of Revolving Credit Facility. Subject to the terms and
conditions
of this Agreement, Lender hereby agrees to
establish a revolving credit facility
(hereinafter, the "Revolving Credit
Facility") in the maximum amount of One
Hundred Thousand Dollars ($100,000) in
favor of Borrower on the following terms
and conditions:
a. The term of the Revolving Credit Facility shall begin on the
date
of this Agreement and shall end on the one
year anniversary of the date of this
Agreement, unless accelerated pursuant to
Section 5 hereinbelow (the
"Termination Date").
b. Advances of funds under the Revolving Credit Facility (each
an
"Advance") may be made, at the discretion
of Lender in accordance with the terms
of this Agreement, at any time prior to the
Termination Date upon receipt by
Lender of written request therefor from
Borrower; at no time shall the aggregate
obligation of Borrower to Lender exceed One
Hundred Thousand Dollars ($100,000).
Each advance shall be due and payable 90
days after the date that funds for the
advance are received by the Borrower (each
a "Repayment Date"). Borrower may at
any time prior to the Repayment Date repay
all or any part of said loans under
the Revolving Credit Facility and
subsequently receive further advances,
consistent with the terms and conditions
hereof. All Advances shall be sent by
wire transfer pursuant to the instructions
attached at Exhibit A.
c. At the time of each Advance, Borrower shall execute and
deliver
to Lender a promissory note (in each
instance, the "Note") in the form attached
hereto as Exhibit B and incorporated by
reference herein.
d. The principal amount due for each Advance shall bear simple
interest at the rate of twelve percent
(12%) per annum.
e. Borrower may prepay any Advance at any time in any amount
without
premium or penalty.
f. Amounts borrowed under the Revolving Credit Facility shall
be
used for the purposes specified in Section
9.b. of this Agreement.
g. As additional consideration for Lender's commitment to
provide
the Revolving Credit Facility, Borrower
shall issue to Lender 50,000 shares of
restricted common stock of
REVOLVING CREDIT LOAN AGREEMENT
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Borrower. Lender is an accredited investor
and shall provide to Borrower
additional written representations and
warranties, as are reasonably requested
by Borrower, to ensure compliance with
applicable securities laws. In an Event
of Default (hereinafter defined), Lender
shall have the right to demand that
Borrower file a registration statement to
register the shares for resale by the
Lender, in the same manner as described in
Section 4 below.
2. Fees
and Expenses. Borrower agrees to reimburse Lender for all
out-of-pocket costs and expenses incurred
by Lender in connection with the
protection, enforcement and collection of
all amounts advanced under the
Revolving Credit Facility. These costs are
to include all costs and expenses
incurred in enforcing the rights of Lender
under this Agreement whether or not
upon the occurrence of any Event of Default
(hereinafter defined).
3. Promises to Pay.
Borrower promises to pay to Lender when due, whether
by normal maturity, acceleration or
otherwise, the entire outstanding principal
amount of the Revolving Credit Facility,
together with interest, and all other
amounts payable by Borrower to Lender
hereunder, including costs of collection,
in accordance with the terms of this
Agreement and each Note.
4.
Collateral. Borrower shall issue 200,000 shares of restricted
common
stock to be held in escrow as collateral
security to ensure repayment of any
Advances. In an Event of Default
(hereinafter defined), Lender shall have the
right to demand that Borrower file a
registration statement to register the
shares for resale by the Lender. If a
registration statement is not declared
effective within sixty days after demand by
Lender, Borrower shall be liable for
a 10% of the principal amount due as
penalty for each 30 day period thereafter
until effective, up to a maximum of 100%.
Upon the effectiveness of such
registration, the Lender has the right to
accept the 200,000 shares as payment
and satisfaction in full of any Advance,
Note, principal, interest, fees and
expenses permitted under the Agreement; and
the escrow agent shall release the
200,000 shares to Lender. If there has been
no Event of Default, then at the
Termination Date, the shares shall be
returned to Borrower for cancellation.
Borrower and Lender shall enter into an
escrow agreement with Joseph Emas, Esq.,
as escrow agent.
5. Events
of Default; Acceleration. Any or all of the liabilities of
Borrower to the Lender in connection with
the Revolving Credit Facility shall,
at the option of Lender, be immediately due
and payable upon the occurrence of
any of the following events of default
(each of which shall be hereinafter
referred to as an "Event of Default"): (a)
default in the payment, when due or
payable, of any obligation of Borrower
under this Agreement or the Note; (b) if
any representation or warranty by Borrower
hereunder is not complete or accurate
at any time that any advances are
outstanding hereunder; (c) failure of Borrower
after request by Lender to permit the
inspection of books or records of
Borrower; (d) issuance of any injunction or
of an attachment or judgment against
any property of Borrower that is not
discharged within thirty (30) days after
issuance; (e) the insolvency of Borrower,
or the filing of any bankruptcy,
reorganization, debt arrangement or other
proceeding or case against Borrower
under any bankruptcy or insolvency law or
commencement of any dissolution or
liquidation proceeding against Borrower,
any of which is either consented to or
acquiesced in by Borrower or remains
undismissed for thirty (30) days after the
date of entry or the commencement by
Borrower of a voluntary case under the
federal bankruptcy laws or any state
insolvency or similar laws, or the consent
by Borrower to the appointment of a
receiver, liquidator, assignee, trustee,
custodian or similar official for Borrower
or any of its property, or the making
by Borrower of any assignment for the
benefit of creditors or the failure by
Borrower generally to pay Borrower's debts,
as the case may be, as they become
due; (f) a change in the condition or
affairs (financial or otherwise) of
Borrower that in the opinion of the Lender
increases Lender's risk in connection
with the Revolving Credit Facility or
impairs the
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prospect of timely payment of the Revolving
Credit Facility; (g) default in the
performance of any obligation, covenant or
agreement contained or referred to
herein or in the Note; or (h) failure of a
"Condition of Lending" described
hereinafter in