I have invested a large sum of money with a company (individual with
LLC) who has filed chapter 11 bankruptcy. I am the 1st position. I was
prepaid 1st 6 months of interest. 8 months have passed and no
additional payments have been received. I spoke with someone right
after bankruptcy was filed. Calls to the company go to a voice mailbox
that is full after the 6 month date.
I have created a Notice of Contract Default that I will be sending to
them via their lawyer. Does anyone have any recommendations on how to
proceed beyond this.
Below are some details of the loan agreement. I've replaced specific details with 'xxxx'.
Terms of Payment (interest only): On or before March 15, 2024,
Borrower shall make a prorated interest payment for the month of March
2024 in the amount of xxxx per day beginning on the date of execution of
this note through March 15, 2024. The first monthly interest
installment of xxxxx due on or before April 15, 2024 and continuing in
like consecutive monthly interest installments of this amount for a
total of one (1) year or twelve (12) payments at which time the entire
unpaid balance, including Principal, accrued but unpaid interest, will
become due and payable. Interest shall accrue in the amount of xxxx per
day. Installments will be due on the fifteenth (15"h) of every month;
unless the fifteenth (15"h) should fall on a Sunday or federal holiday,
in which case the payment will be due on the next business day. Payments
will be applied first to accrued interest and the remainder to
reduction of the Principal Amount. At Lender's option, a late fee of
5.000% of the installment may be added to any installment not received
within ten (10) days of the due date. Installments postmarked by due
date or received within five (5) days of the due date shall not be
considered late. Extension: Borrower may extend this note once for up to
twelve (12) months. If Borrower wishes to exercise this option to
extend, Borrower shall notify Lender of Borrower's intent to extend in
writing prior to the Maturity Date.
Security for Payment: This note is secured by n deed of trust of even
date from Borrower to Doc Prep 911, Trustee, both of which cover the
following real property: Lots xxxx, City of xxxx, according to the map
or plat recorded in xxxx, Map Records, xxxx, Texas. Commonly known as
xxxx. Other Security for Payment: None
Promise to Pay
Borrower promises to pay to the order of Lender the Principal Amount
plus interest at the Annual Interest Rate. This note Is payable at the
Place for Payment and according to the Terms of Payment. All unpaid
amounts are due by the Maturity Date. If any amount is not paid either
when due under the Terms of Payment or on acceleration of maturity,
Borrower promises to pay any unpaid amounts plus interest from the date
the payment was due to the date of payment at the Annual Interest Rate
on Matured, Unpaid Amounts.
Defaults and Remedies
A default exists under this note if (1) Borrower defaults in the
payment of this note or in the performance of any obligation in any
instrument securing or collateral to this note; (2) (a) Borrower or (b)
any other person liable on any part of this note (an "Other Obligated
Party") fails to timely pay or perform any obligation or covenant in any
written agreement between Lender and Borrower or any Other Obligated
Party other than as described in (1) above; (3) any representation in
this note or in any other written agreement between Lender and Borrower
or any Other Obligated Party is materially false when made; (4) a
receiver is appointed for Borrower or an Other Obligated Party or any
property on which a lien or security interest is created as security
(the "Collateral Security") for any part of this note; (5) any
Collateral Security is assigned for the benefit of creditors; (6) a
bankruptcy or insolvency proceeding is commenced by Borrower, a
partnership of which Borrower is a general partner, or an Other
Obligated Party; (7) (a) a bankruptcy or insolvency proceeding is
commenced against Borrower, a partnership of which Borrower is a general
partner, or an Other Obligated Party and (b) the proceeding continues
without dismissal for sixty days, the party against whom the proceeding
is commenced admits the material allegations of the petition against it,
or an order for relief is entered; (8) Borrower, a partnership of which
Borrower is a general partner, or an Other Obligated Party is
terminated, begins to wind up its affairs, or is authorized to terminate
or wind up its affairs by its governing body or persons, or any event
occurs or condition exists that permits the termination or winding up of
the affairs of Borrower, a partnership of which Borrower is a general
partner, or an Other Obligated Party; or (9) any Collateral Security is
impaired by loss, theft, damage, levy and execution, issuance of an
official writ or order of seizure, or destruction, unless it is promptly
replaced with collateral security of like kind and quality or restored
to its former condition.
Notwithstanding any other provision of this note, in the event of a
default, before exercising any of Lender's remedies under this note or
any deed of trust or warranty deed with vendor's lien securing it,
Lender will first give Borrower written notice of default and Borrower
will have ten days after notice is given in which to cure the default.
If the default is not cured ten days after notice, Borrower and each
surety, endorser, and guarantor waive all demand for payment,
presentation for payment, notice of intention to accelerate maturity,
notice of acceleration of maturity, protest, and notice of protest, to
the extent permitted by law, and rights under sections 51.003, 51.004
and 51.005 of the Texas Property Code.
