PROMISSORY NOTE
$________ Dated: ___________
SECTION ONE
TERMS OF NOTE
FOR VALUE RECEIVED, SGI INTERNATIONAL, OTC Bulletin Board symbol "SGII"
("the "Debtor"), of 1200 Prospect Street, Suite 325, La Jolla, CA 92037 promises
to pay to the order of ________________ (hereinafter "Holder"), the principal
sum of __________________ ($______) Dollars with interest thereon at the rate of
nine percent (9%) per annum, payable upon 30 days written demand but no sooner
than on July 19, 2001, in cash or at the option of Debtor, all principal and
interest can be paid by issuing Holder _______ shares of restricted stock of
Debtor. Debtor shall be in default hereunder only after Holder gives five (5)
days advance written notice to Debtor that it is in default, and Debtor does not
cure such default within this prescribed period.
SECTION TWO
PREPAYMENT OF NOTE
Prepayment of the full principal balance, along with all unpaid
interest, or any portion of the principal balance, along with any portion
thereof of unpaid interest, is permitted at any time without penalty.
SECTION THREE
EFFECT OF WAIVER OF RIGHTS BY Holder
Holder is not under any obligation to exercise any of his rights under
this note, and failure to exercise his rights under this note or to delay in
exercising any of his rights shall not be deemed a waiver of or in any manner
impair any of the rights of Holder.
SECTION FOUR
CUMULATIVE RIGHTS AND REMEDIES
The rights and remedies of Holder specified in this note are cumulative
and do not exclude any other rights or remedies he may otherwise have.
SECTION FIVE
ACCELERATION ON INSOLVENCY OF DEBTOR
If Debtor shall be adjudged bankrupt, or file a petition in bankruptcy,
or have a petition in bankruptcy filed against it, this note shall become due
and payable immediately without demand or notice.
SECTION SIX
WAIVER OF PRESENTMENT, PROTEST, AND NOTICE OF DISHONOR
Except as otherwise required herein, Debtor hereby waives all acts on
the part of Holder required in fixing the liability of the party, including
among other things presentment, notice of dishonor, protest, notice of protest,
notice of nonpayment, and any other notice.
SECTION SEVEN
CHOICE OF LAWS
This note shall be governed by and construed in accordance with the
laws of California in all respects, including matters of construction, validity
and performance.
SECTION EIGHT
COSTS OF COLLECTION
Debtor shall pay on demand all costs of collection, including legal
expenses and attorney fees, incurred by Holder in enforcing this note on
default.
SECTION NINE
INTEREST CHARGES
If a law, which applies to this note and which sets the maximum
interest amount, is finally interpreted so that the interest in connection with
this note exceed the permitted limits, then: (1) any such interest shall be
reduced by the amount necessary to reduce the interest to the permitted limit;
and (2) any sums already collected (if any) from the Debtor which exceed the
permitted limits will be refunded to the Debtor. Holder may choose to make this
refund by reducing the principal Debtor owes under this note or by making a
direct payment to the Debtor. If a refund reduces the principal, the reduction
will be treated as a partial payment.
Dated:
SGI INTERNATIONAL
By
Authorized Signatory
