The unpaid principal amount of this Note shall accrue interest on the basis of a 360 day year at 12% per annum, provided that upon the occurrence and during the continuance of an Event of Default, at the option of the Payee (other than with respect to an Event of Default under Section 9(e) hereof, in which case it shall be automatic), the outstanding principal amount of this Note and any accrued and unpaid interest and all other overdue amounts shall each bear interest until paid at the stated rate plus 3% per annum. Accrued interest shall be payable (a) upon the payment or prepayment of any principal owing under this Note (but only on the principal amount so paid or prepaid), (b) on the last business day of each month and (c) on the Maturity Date.