EXHIBIT 10.40
PROMISSORY NOTE
$100,000.00
1. Promise to Pay.
For value received, I, Edward F. Garnett ("Staff Member"), a
married man, and I, Sandra K. Garnett, wife of Staff Member,
promise to pay to the order of Amgen Inc., a Delaware
corporation ("Payee"), at its office at Amgen Center, Thousand
Oaks, CA 91320-1789, the sum of One Hundred Thousand Dollars
and No Cents ($100,000.00) (the "Principal"), payable in full on
the earlier of five (5) years from date of execution of this
Note or thirty (30) days from the date on which Staff Member
ceases to be an employee of Payee, whichever first occurs,
together with interest on the Principal from the date of this
Note until such date as the Note is paid in full. Interest on
this Note shall be computed as set forth below. The interest
rate for the period from the date of this Note through December
31, 1997 (the "initial rate") is 4.1 percent per annum on the
unpaid Principal. After December 31, 1997 the interest rate on
this Note shall change as set forth below.
2. Adjustable Interest Rate.
The interest rate shall be adjusted annually on January 1 of
each year (the "Change Date") so as to equal the average
interest rate designated as the "Introduction Rates" on
adjustable rate loans as publicly offered by the banks and
savings and loans in California as published by the Los Angeles
Times in its Sunday edition. The rate shall be set using the
rates published in the Los Angeles Times on the Sunday
immediately preceding the Change Date. In the event that the
"Introduction Rates" list is not published in the Los Angeles
Times for any reason, then, in such event, the Payee shall
establish the interest rate based on a survey by it of the
introductory interest rates on adjustable loans offered by no
fewer than five banking institutions located in Southern
California that the Payee, in its sole discretion, deems
representative of banking institutions in the Ventura and Los
Angeles County areas. Payee shall give Staff Member notice if
the interest rate shall be determined using this alternative
method. Notwithstanding the foregoing, the interest rate shall
never be increased or decreased on any single Change Date by
more than one percentage point from the interest rate for the
preceding 12 months. At no time during the term of this Note
shall the annual interest rate exceed 7.1 percent per annum.
Payee shall deliver or mail to Staff Member a notice of any
changes in the adjustable interest rate on this Note and the
amount of the Staff Member's semi-monthly payroll deductions
before the effective date of any change. The notice shall
include information required by law to be given to Staff Member
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and also the title and telephone number of a person who shall
answer any questions Staff Member may have regarding the notice.
3. Salary Deduction.
The interest on this Note shall be payable by semi-monthly
deductions from Staff Member's salary. The amount of such
deductions shall initially be One Hundred Seventy Dollars and
Eighty-Three Cents ($170.83) per installment; provided, however,
that the manner of payment of this Note shall not be limited to
deductions from Staff Member's salary. The amount of such
deductions shall be adjusted annually concurrently with any
adjustment in the interest rate on this Note to ensure that
interest to be incurred during the ensuing calendar year shall
be paid in twenty-four (24) equal payments. The first such
installment shall be on August 15, 1997; the second installment
shall be on August 31, 1997; and each successive installment
shall be on the fifteenth and last days of each successive month
until the Principal is repaid. Payee shall give Staff Member at
least seven (7) days advance notice of any adjustment in the
amount of said payroll deductions. Staff Member acknowledges
and agrees that by executing this Note, Staff Member agrees to
the payroll deductions described in this Note.
4. Option to Convert.
At the end of the term of this Note, Staff Member shall have the
option to seek to convert this loan to a loan amortized over an
additional five-year period by executing a new Promissory Note
at terms to be mutually agreed upon by Staff Member and Payee.
In the event that Staff Member and Payee are unable to reach
agreement on such terms, this Note shall become immediately due
and payable.
5. Prepayment.
Staff Member may prepay without penalty this Note in whole or in
part at any time. Any and all payments or prepayments under
this Note may be made by Staff Member to Payee at the following
address (or such other address as it designates in writing to
Staff Member):
AMGEN INC.
Amgen Center
Thousand Oaks, California 91320-1789
Attention: Accounting Manager
6. Attorneys' Fees.
Staff Member agrees to pay all costs and expenses, including,
without limitation, collection agency fees and expenses,
reasonable attorneys' fees, costs of suit and costs of appeal,
which Payee may incur in the exercise, preservation or
enforcement of its right, powers and remedies hereunder, or
under any documents or instruments securing this Note, or under
law.
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7. Modification of Terms.
Payee may, with or without notice to Staff Member, cause
additional parties to be added to this Note, or release any
party to this Note, or revise, extend, or renew the Note, or
extend the time for making any installment provided for by this
Note, or accept any installment in advance, all without
affecting the liability of Staff Member. Staff Member may not
assign or transfer in any manner whatsoever this Note or any of
Staff Member's obligations under this Note.
8. Security Interest.
The purpose of this loan is to purchase a personal residence.
Staff Member shall secure this loan by executing and causing to
be filed, immediately upon close of escrow, a trust deed on this
residence, commonly known as 5037 Lakeview Canyon Road, Westlake
Village, California 91362 whose property description is as
follows:
Lot 39 of Tract No. 3507-2, in the City of Thousand Oaks, County
of Ventura, State of California, as per map recorded in Book 94,
Pages 57 through 77 of Miscellaneous Records (Maps), in the
Office of the County Recorder of said County.
9. Acceleration.
A) In the event Staff Member fails to pay when due any sums
under this Note, then:
(1) the entire unpaid balance of this Note shall, at the
option of the Payee hereof, immediately become due and payable
in full and unpaid Principal thereafter shall bear interest at
the lesser of the maximum rate permitted by law or at the rate
of 7.1 percent per annum; and
(2) Staff Member authorizes Payee to deduct any sums due to
Payee under this Note from any monies, including any wages
due, otherwise owing to Staff Member.
B) If Staff Member sells the residence which is purchased with
the funds herein provided, this Note shall immediately become
due and payable upon the sale of such residence.
10. Waiver of Rights by Staff Member.
Staff Member waives (1) presentment, demand, protest, notice of
dishonor and/or protest and notice of non-payment; (2) the
right, if any, to the benefit of, or to direct the application
of, any security hypothecated to Payee until all indebtedness of
Staff Member to Payee, however arising, has been paid; and (3)
the right to require the Payee to proceed against any party to
this Note, or to pursue any other remedy in Payee's power.
Payee may proceed against Staff Member directly and
independently of any other party to this Note, and the cessation
of the liability of any other party for any reason other than
full payment, or any revision, renewal, extension, forbearance,
change of rate of interest, or acceptance, release or
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substitution of security, or any impairment or suspension of
Payee's remedies or rights against any other party, shall not in
any way affect the liability of Staff Member.
11. Obligations of Persons Under this Note.
If more than one person signs this Note, each person is fully
and personally obligated to keep all of the promises made in
this Note, including the promise to pay the full amount owed.
Any person who is a guarantor, surety, or endorser of this Note
is also obligated to do these things. Any person who takes over
these obligations, including the obligations of a guarantor,
surety or endorser of this Note, is also obligated to keep all
of the promises made in this Note. Payee may enforce its rights
under this Note against each person individually or against all
of the signatories to this Note. This means that any one of the
signatories to this Note may be required to pay all of the
amounts owed under this Note.
12. Governing Law.
This Note and the obligations under this Note of Staff Member or
any other signatory to this Note shall be governed by and
interpreted and determined in accordance with the laws of the
State of California as applied to contracts between California
residents entered into and to be performed entirely within said
State.
IN WITNESS WHEREOF, the undersigned has/have executed and delivered
this Note as of the 18th day of July, 1997.
/s/ Edward F. Garnett
EDWARD F. GARNETT
/s/ Sandra K. Garnett
SANDRA K. GARNETT
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