Failure to Pay Default Amount Clause Samples
The "Failure to Pay Default Amount" clause defines the consequences and remedies available when a party fails to make a required payment under the agreement. Typically, this clause specifies the amount due upon default, which may include the original payment, accrued interest, and possibly additional penalties or fees. For example, if a borrower misses a loan payment, the clause would outline the total sum owed as a result of the default. Its core practical function is to provide a clear and enforceable mechanism for compensating the non-defaulting party and deterring late or missed payments, thereby reducing uncertainty and financial risk.
Failure to Pay Default Amount. If the Corporation fails to pay the Default Amount within five (5) business days of its receipt of a notice requiring such payment (a "Default Notice"), then the Holder (i) shall be entitled to interest on the Default Amount at a per annum rate equal to the lower of twenty-four percent (24%) and the highest interest rate permitted by applicable law from the date on which the Corporation receives the Default Notice until the date of payment of the Default Amount hereunder, and (ii) shall have the right, at any time and from time to time, to require the Corporation, upon written notice, to immediately convert (in accordance with the terms of Paragraph A of Article II) all or any portion of the Default Amount, plus interest as aforesaid, into shares of Common Stock at the lowest Exercise Price in effect during the period beginning on the date on which the Corporation receives the Default Notice and ending on the Exercise Date with respect to the conversion of such Default Amount. In the event the Corporation is not able to pay all amounts due and payable with respect to all Prepaid Warrants subject to Default Notices, the Corporation shall pay the Holders of such Prepaid Warrants which are the subject of Default Notices such amounts pro rata, based on the total amounts payable to each such Holder relative to the total amounts payable to all such Holders.
Failure to Pay Default Amount. If the Corporation fails to pay the Default Amount within five (5) business days of its receipt of a notice requiring such payment (a "Default Notice"), then the Holder (i) shall be entitled to interest on the Default Amount at a per annum rate equal to the lower of twenty-four percent (24%) and the highest interest rate permitted by applicable law from the date of the Default Notice until the date of payment hereunder, and (ii) shall have the right, at any time and from time to time, to require the Corporation, upon written notice, to immediately convert (in accordance with the terms of Paragraph A of Article IV) all or any portion of the Default Amount, plus interest as aforesaid, into shares of Class A Common Stock at the lowest Conversion Price in effect during the period beginning on the date of the Default Notice and ending on the Conversion Date with respect to the conversion of such Default Amount. In the event the Corporation is not able to pay all amounts due and payable with respect to all Debentures subject to Default Notices, the Corporation shall pay the Holders such amounts pro rata, based on the total amounts payable to such Holder relative to the total amounts payable to all Holders.