Common use of Penalty Interest and Compound Interest Clause in Contracts

Penalty Interest and Compound Interest. (1) If the Borrower does to use the loan for the purpose agreed under this Agreement or the Borrower fails to repay the loan on a timely basis and has not achieved agreement with the Lender concerning extension (which constitutes a late repayment), the Lender shall be entitled to a penalty interest for the misused or overdue loan based on the penalty interest rate agreed under this Agreement. With respect to the interest that is not paid on time, the Lender shall be entitled to a compound interest based on the penalty interest rate as agreed under this Agreement.

Penalty Interest and Compound Interest. (1) . If the Borrower does to use the loan for the purpose agreed under this Agreement or the Borrower fails to repay the loan on a timely basis and has not achieved agreement with the Lender concerning extension (which constitutes a late repayment), the Lender shall be entitled to a penalty interest for the misused or overdue loan based on the penalty interest rate agreed under this Agreement. With respect to the interest that is not paid on time, the Lender shall be entitled to a compound interest based on the penalty interest rate as agreed under this Agreement.