EXHIBIT 4.1
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), OR ANY STATE SECURITIES OR
BLUE SKY LAWS AND MAY NOT BE OFFERED,
SOLD, TRANSFERRED, HYPOTHECATED OR
OTHERWISE ASSIGNED EXCEPT AS PROVIDED HEREIN
AND (1) PURSUANT TO A REGISTRATION
STATEMENT WITH RESPECT TO SUCH SECURITIES
WHICH IS EFFECTIVE UNDER THE ACT OR (2)
PURSUANT TO AN AVAILABLE EXEMPTION FROM
REGISTRATION UNDER THE ACT AND UNDER
APPLICABLE STATE SECURITIES AND BLUE SKY
LAWS RELATING TO THE DISPOSITION OF
SECURITIES, PROVIDED THAT AN OPINION OF
COUNSEL TO SUCH EFFECT IS PROVIDED TO THE
COMPANY IN CONNECTION THEREWITH.
PROMISSORY NOTE
$_______________
October ___, 2004
FOR VALUE RECEIVED, LION, Inc., a Washington corporation
("LION"),
promises to pay to
_________________________ ("Holder"), at Holder's office at
_________________________ or at such other
address as Holder may from time to
time designate in writing, the principal
sum of _______________________ Dollars
($_______________) together with interest
from the date of this Promissory Note
(this "Note") until October ___, 2007
("Maturity") on the principal balance from
time to time remaining unpaid hereon at the
rate of eight percent (8.0%) per
annum compounded annually. Interest shall
be computed based on the basis of a
365 day year for the actual number of days
elapsed.
1. PAYMENT OF PRINCIPAL AND INTEREST. Interest on this Note will
be
payable in arrears on October __ of each
calendar year, with the first such
payment payable on October __, 2005. No
payments of principal on this Note shall
be due and payable until Maturity, at which
time all then unpaid principal and
interest shall be due and payable. All
payments on this Note shall be first
applied against interest and shall be made
and are expressed in United States
dollars.
2. PREPAYMENT. LION shall have the right to prepay any or all of
the
outstanding balance of this Note at any
time and from time to time without
penalty or premium of any kind.
3. EVENTS OF DEFAULT. Each of the following shall constitute an
Event
of Default ("Event of Default")
hereunder:
a. Failure of LION to make any payment of principal or interest
upon this Note when due and such failure or
refusal shall continue for ten (10)
days; or
b. Filing by LION of a voluntary petition in bankruptcy or
filing
by LION of any petition or answer seeking
or acquiescing in any reorganization,
arrangement, composition, readjustment,
liquidation, or similar relief for
itself under any present or future federal,
state or other statute, law or
regulation relating to bankruptcy,
insolvency or other relief for debtors, or
the seeking, consenting to, or acquiescing
by LION in the appointment of any
trustee, receiver,
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custodian, conservator or liquidator for
LION, or the making by LION of any
general assignment for the benefit of
creditors;
c. Filing of a petition against LION seeking any
reorganization,
arrangement, composition, readjustment,
liquidation, or similar relief under any
present or future federal, state or other
law or regulation relating to
bankruptcy, insolvency or other relief for
debts, or the appointment of any
trustee, receiver, custodian, conservator
or liquidator of LION, unless such
petition shall be dismissed within sixty
(60) days after such filing, but in any
event prior to the entry of an order,
judgment or decree approving such
petition;
d. The occurrence of an Event of Default, as defined in the
Secured Notes Agreement, dated as of the
date hereof, by and among LION, Holder
and the other parties named therein;
