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Exhibit 4.1
AMENDED AND RESTATED DEMAND NOTE
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U.S. $400,000.00
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December 16, 2008
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FOR VALUE RECEIVED, the undersigned, RUBBER RESEARCH ELASTOMERICS,
INC., a Minnesota corporation, (the “Borrower”)
promises to pay to the order of RIVIERA INVESTMENTS, INC., a
California corporation (the “Lender”), the principal
sum of FOUR HUNDRED THOUSAND AND NO/100THS DOLLARS ($400,000.00) ON
DEMAND, or if no earlier demand has been made, on October 15, 2009
(the earlier of such dates being the “Termination
Date”).
The Borrower promises to pay interest (computed on the basis of the
number of days elapsed in a year of 360 days) on the unpaid
principal amount hereof from the date hereof until such principal
amount is paid in full at a fluctuating annual rate equal to 10%
per annum above the Prime Rate of Interest; provided, however, that
notwithstanding anything to the contrary contained herein, upon the
occurrence and during the continuance of any Default or Event of
Default, the rate of interest hereunder shall be 12% per annum
above the Prime Rate of Interest (such increased rate of interest
being, the “Default Rate”). The term "Prime
Rate of Interest" shall mean the prime rate of interest published
from time to time in the Wall Street Journal as the prime rate;
provided, however that: (a) if a range of rates is published, then
the Prime Rate of Interest means the highest rate within the range;
and (b) if the Wall Street Journal does not publish the Prime Rate
of Interest, then the term "Prime Rate of Interest" shall mean the
rate of interest publicly announced by U.S. Bank, National
Association, Minneapolis Office, as its Prime Rate, Base Rate,
Reference Rate or the equivalent of such rate, whether or not such
bank makes loans to customers at, above, or below said
rate. Interest shall be due and payable on the first day
of each month (each such date being an “Interest Payment
Date”), commencing January 1, 2009, and at the maturity
hereof. Interest accruing after the maturity
hereof shall be due and payable upon
demand. Each change in the fluctuating interest rate
shall take effect simultaneously with the corresponding change in
the Prime Rate of Interest.
At the written request of the Borrower, accrued interest hereunder
shall be added to the principal balance of the Loan on each
Interest Payment Date rather than being payable in cash (interest
that is added to the principal balance shall be referred to herein
as “PIK Interest”). Unless prohibited under
applicable law, PIK Interest shall itself shall bear interest from
and after the related Interest Payment Date at the interest rate
set forth in the immediately preceding paragraph and shall be
payable at maturity. All amounts of accrued PIK Interest
as of each Interest Payment Date shall no longer be deemed to be
accrued and unpaid interest on the outstanding principal of the
Loan, but shall be considered principal until paid. Any
accrued interest
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