FOR INTERNAL USE ONLY
Obligor #____________________
Obligation #_________________
Commercial Mortgage Loan - CT
LIBOR Rate
MORTGAGE NOTE
$2,250,000.00 Bridgeport, Connecticut
June 28, 1996
FOR VALUE RECEIVED, the undersigned hereby promises to pay
to the order of FIRST UNION BANK OF CONNECTICUT (the "Bank"),
the principal sum of Two Million Two Hundred Fifty Thousand and
00/100 Dollars ($2,250,000.00) (the "Loan") in United States
Dollars, together with interest thereon as hereinafter
provided.
1. INTEREST RATE. Interest shall be charged on the
outstanding principal balance from the date hereof until the
full amount of principal due hereunder has been paid at a rate
equal to LIBOR plus one hundred seventy-five (175) basis
points ("LIBOR-Based Rate"), as determined by Bank prior to the
commencement of each Interest Period. Interest shall be
calculated daily on the basis of the actual number of days
elapsed over a 360 day year. The LIBOR-Based Rate shall remain
in effect, subject to the provisions hereof, for the entire
Interest Period for which it is determined.
"LIBOR" means, with respect to each day during each
Interest Period, the rate (rounded to the next higher 1/100 of
1%) for U.S. dollar deposits of one month maturity as reported
on Telerate page 3750 as of 11:00 a.m., London time, on the
second London business day before the relevant Interest Period
begins (or if not so reported, then as determined by the Bank
from another recognized source or interbank quotation),
adjusted for reserves by dividing that rate by 1.00 minus the
LIBOR Reserve. "LIBOR Reserve" means the maximum percentage
reserve requirement (rounded to the next higher 1/100 of 1% and
expressed as a decimal) in effect for any day during the
Interest Period under the Federal Reserve Board's Regulation D
for Eurocurrency liabilities as defined therein.
"Interest Period" means, initially, the period commencing
on the date hereof and ending on the Commencement Date, and
thereafter, each period commencing on the last day of the
immediately preceding Interest Period and ending one month
thereafter, but in no event after the Maturity Date; subject,
however, to the following provisions: (i) if any Interest
Period would otherwise end on a day which is not a Business
Day, that Interest Period shall be extended to the next
succeeding Business Day unless the result of such extension
would be to carry such Interest Period into another calendar
month, in which event such Interest Period shall end on the
immediately preceding Business Day; (ii) any Interest Period
that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in
the calendar month at the end of such Interest Period) shall
end on the last Business Day of a calendar month; and (iii) the
last Interest Period shall end on the Maturity Date.
2. PAYMENT OF PRINCIPAL AND INTEREST. Interest only on the
outstanding principal balance from the date hereof to August 1,
1996 (the "Commencement Date") shall be due and payable on the
Commencement Date. Thereafter, principal and interest shall be
due and payable on the dates set forth in the Repayment
Schedule attached hereto and made a part hereof (the "Repayment
Schedule") in consecutive monthly installments in an amount
equal to the sum of (i) all then accrued and unpaid interest,
plus (ii) a principal payment in the amount set forth in the
Repayment Schedule. The entire unpaid principal amount hereof,
together with accrued and unpaid interest thereon and all other
amounts payable hereunder shall be due and payable on June 1,
2001 (the "Maturity Date").
3. APPLICATION OF PAYMENTS. Except as otherwise specified
herein, each payment or prepayment, if any, made under this
Note shall be applied to pay late charges, accrued and unpaid
interest, principal, escrows (if any), and any other fees,
costs and expenses which the undersigned is obligated to pay
under this Note, in such order as Bank may elect from time to
time in its sole discretion.
4. TENDER OF PAYMENT. All payments made hereunder shall be
made on the due date thereof, in immediately available funds
and in lawful currency of the United States of America. All
payments made hereunder shall be made to the Bank at its
offices at 300 Main Street, Stamford, Connecticut 06904 or at
such other address as the Bank shall notify the Borrower of in
writing. The Borrower agrees to maintain an account at the
Bank continuously until all amounts due hereunder are paid in
full (the "Account"). The Bank may, and the Borrower
authorizes the Bank to, debit the Account for the amount of any
payment as and when such payment becomes due hereunder as more
fully described in that certain Authorization to Charge Account
from the undersigned to Bank of even date herewith. The
foregoing rights of the Bank to debit the Borrower's accounts
shall be in addition to, and not in limitation of, any rights
of set-off which the Bank may have hereunder or under any Loan
Document nor shall the rights hereunder limit the Bank's
recourse to any particular source of funds or monies.
5. PREPAYMENT. The Loan may be prepaid, in whole or in
part, on the last day of an Interest Period. Any prepayment
shall include accrued and unpaid interest to the date of
prepayment on the principal amount prepaid and all other sums
due and payable hereunder. All payments received on this Note
may be applied in such order as the Bank in its sole discretion
shall determine. The monthly principal installment shall not
be reamortized following a partial prepayment.
6. SECURITY FOR THE NOTE.
6.1. This Note is executed and delivered in
accordance with a commercial transaction described in a Loan
Agreement dated this date between the undersigned and Bank (the
"Loan Agreement"). As security for the payment of the monies
owing under this Note, the undersigned has delivered or has
caused to be delivered to Bank the following (each a "Loan
Document" and collectively with this Note, the Loan Agreement,
and any other guaranty, document, certificate or instrument
executed by the undersigned or any other obligated party in
connection with the Loan, the "Loan Documents"):
(a) an Open-End Mortgage and Security Agreement (the
"Mortgage") on certain real property and the improvements
situated thereon in the City of Danbury, County of Fairfield
State of Connecticut, as more fully described in the Mortgage
(the "Mortgaged Premises");
(b) a General Security Agreement from the undersigned;
(c) a Guaranty and Suretyship Agreement by Fuel Cell
Manufacturing Corporation and a Guaranty and Suretyship
Agreement by Fuel Cell Engineering Corporation (collectively
the "Guaranty"); and
(d) a General Security Agreement from Fuel Cell
Manufacturing Corporation securing the Guaranty of Fuel Cell
Manufacturing Corporation.
6.2. The undersigned hereby grants to Bank a continuing
security interest in all property of the undersigned, now or
hereafter in the possession of Bank or any Affiliate (as
defined below) in any capacity whatsoever, including, but not
limited to, any balance or share of any deposit, trust or
agency account, as security for the payment of this Note and
any other liabilities of the undersigned to Bank, which
security interest shall be enforceable and subject to all the
provisions of this Note, as if such property were specifically
pledged hereunder.
7. ADDITIONAL PAYMENTS; LATE CHARGE; DEFAULT RATE.
7.1. Additional Payments. In addition to the payments
provided for in Section 2 above, the undersigned promises to
pay on demand any additional monies required to be paid or
advanced by the undersigned or by any other party obligated
under any of the Loan Documents or paid or advanced on behalf
of the undersigned or such party by Bank pursuant to the terms
of the Loan Agreement, the Mortgage or any other Loan Document,
which obligation shall be continuing and shall survive any
judgment entered with respect to this Note or a foreclosure of
the Mortgage. This Note shall evidence, and the Mortgage and
other Loan Documents shall secure the payment of, all such sums
so advanced or paid.
7.2. Late Charge. In the event that any installment of
principal or interest required to be made by the undersigned
under this Note shall not be received by Bank on or before its
due date, the undersigned shall pay to Bank, on demand, a late
charge of five percent (5%) of such delinquent payment for the
purpose of defraying the expense
incident to the processing of such delinquent payment. The
foregoing right is in addition to, and not in limitation of,
any other rights which Bank may have upon the undersigned's
failure to make timely payment of any amount due hereunder.
7.3. Default Rate. Except as otherwise provided below,
from and after the occurrence of an Event of Default hereunder,
all amounts remaining unpaid or thereafter accruing hereunder,
as well as any amounts owing under Section 7.1., shall, at
Bank's option, bear interest at a default rate of four percent
(4%) per annum above the interest rate then in effect as set
forth herein, or the highest permissible rate under applicable
law, whichever is less. If the Loan is not paid when due,
whether at the Maturity Date, upon acceleration, or otherwise,
all amounts remaining unpaid or thereafter accruing hereunder
shall bear interest at a default rate equal to the Bank's Prime
Rate plus four percent (4.0%), or the highest permissible rate
under applicable law, whichever is less (such rate and the rate
specified in the immediately preceding sentence are each
hereinafter referred to as a "Default Rate"). As used herein,
"Prime Rate" means the rate of interest established by the Bank
s its reference rate in making loans, and is not tied to any
external rate of interest or index. Each change in the Prime
Rate shall be effective automatically and immediately without
notice to the Borrower. The applicable Default Rate of
interest shall be payable upon demand, but in no event later
than when scheduled interest payments are due, and shall also
be charged on the amounts owed by the undersigned to Bank
pursuant to any judgments entered in favor of Bank with respect
to this Note and shall continue to accrue after judgment until
collection.
8. INDEMNIFICATION; ADDITIONAL COSTS; UNAVAILABILITY OF
RATE.
8.1. Indemnification. The undersigned shall indemnify
Bank against Bank's loss or expense in employing deposits as a
consequence of (i) the undersigned's failure to make any
payment when due under this Note, or (ii) any prepayment of the
Loan on a date other than the last day of an Interest Period
("Indemnified Loss or Expense").
8.2. Additional Costs. If, at any time, a new, or a
revision in any existing law or interpretation or
administration (including reversals) thereof by any government
authority, central bank or comparable agency imposes, increases
or modifies any reserve or similar requirement against assets,
deposits or credit extended by Bank, or subjects Bank to any
tax, duty or other charge (except tax on Bank's net income),
and any of the foregoing increase the cost to Bank of
maintaining its commitment or reduce the amount of any sum
received or receivable by Bank under this Note, within 15 days
after demand by Bank, the undersigned agrees to pay Bank such
additional amounts as will compensate Bank for such increased
costs or reductions ("Additional Costs").
8.3. Match Funding. The amount of such (i) Indemnified
Loss or Expense, or (ii) Additional Costs outlined above shall
be determined, in Bank's sole discretion, based upon the
assumption that Bank funded 100% of that portion of the Loan to
which the LIBOR-Based Rate applies in the applicable London
interbank market.
8.4. Unavailability of Interest Rate. If, at any time,
(i) Bank shall determine that, by reason of circumstances
affecting foreign exchange and interbank markets generally,
LIBOR deposits in the applicable amounts are not being offered
to Bank; or (ii) a new, or a revision in any existing law or
interpretation or administration (including reversals) thereof
by any government authority, central bank or comparable agency
shall make it unlawful or impossible for Bank to honor its
obligations under this Note, then (A) Bank's obligation to make
or maintain a LIBOR-Based Rate shall be suspended, and (B) the
applicable LIBOR-Based Rate shall immediately be converted to
the Prime Rate for the remainder of the term of the Loan.
"Prime Rate" means the rate of interest established by Bank as
its reference rate in making loans, and is not tied to any
external rate of interest or index. The rate of interest
charged under the Note following conversion to the Prime Rate
shall change automatically and immediately as of the date of
any change in the Prime Rate without notice to the undersigned.
9. EVENTS OF DEFAULT. Each of the following shall
constitute an event of default hereunder (an "Event of
Default"): (a) the failure of the undersigned to make any
installment of principal or interest hereunder when due and
payable; or (b) the occurrence of any other default in any
term, covenant or condition hereunder or any Event of Default
under the Loan Agreement, the Mortgage or any other Loan
Document.
10. REMEDIES. If an Event of Default exists, Bank may
exercise any right, power or remedy permitted by law or as set
forth herein or in the Loan Agreement, the Mortgage or any
other Loan Document including, without limitation, the right to
declare the entire unpaid principal amount hereof and all
interest accrued hereon, and all other sums secured by the
Mortgage or any other Loan Document to be, and such principal,
interest and other sums shall thereupon become, forthwith due
and payable.
11. CONTINUING ENFORCEMENT OF NOTE. If, after receipt of
any payment of all or any part of this Note, Bank is compelled
or agrees, for settlement purposes, to surrender such payment
to any person or entity for any reason (including, without
limitation, a determination that such payment is void or
voidable as a preference or fraudulent conveyance, an
impermissible setoff, or a diversion of trust funds), then this
Note and the other Loan Documents shall continue in full force
and effect or be reinstated, as the case may be, and the
undersigned shall be liable for, and shall indemnify, defend
and hold harmless Bank with respect to the full amount so
surrendered. The provisions of this Section shall survive the
cancellation or termination of this Note and shall remain
effective notwithstanding the payment of the obligations
evidenced hereby, the release of any security interest, lien or
encumbrance securing this Note or any other action which Bank
may have taken in reliance upon its receipt of such payment.
Any cancellation, release or other such action shall be deemed
to have been conditioned upon any payment of the obligations
evidenced hereby having become final and irrevocable.
12. MISCELLANEOUS.
12.1. Disclosure of Financial Information. Bank is
hereby authorized to disclose any financial or other
information about the undersigned to any regulatory body or
agency having jurisdiction over Bank or to any present, future
or prospective participant or successor in interest in any loan
or other financial accommodation made by Bank to the
undersigned. The information provided may include, without
limitation, amounts, terms, balances, payment history, return
item history and any financial or other information about the
undersigned. The undersigned agrees to indemnify, defend,
release Bank, and hold Bank harmless, at the undersigned's cost
and expense, from and against any and all lawsuits, claims,
actions, proceedings, or suits against Bank or against the
undersigned and Bank, arising out of or relating to Bank's
reporting or disclosure of such information. Such indemnity
shall survive the repayment or other satisfaction of the
obligations evidenced hereby.
12.2. Remedies Cumulative. The rights and remedies of
Bank as provided herein and in any other Loan Document shall be
cumulative and concurrent, may be pursued separately,
successively or together against the undersigned or the
Mortgaged Premises or any other collateral security for payment
of amounts due hereunder, or any guarantor thereof, at the sole
discretion of Bank, may be exercised as often as occasion
therefor shall arise, and shall be in addition to any other
rights or remedies conferred upon Bank at law or in equity.
The failure, at any one or more times, of Bank to exercise any
such right or remedy shall in no event be construed as a waiver
or release thereof. Bank shall have the right to take any
action it deems appropriate without the necessity of resorting
to any collateral securing this Note.
12.3. Integration. This Note and the other Loan
Documents constitute the sole agreement of the parties with
respect to the transaction contemplated hereby and supersede
all oral negotiations and prior writings with respect thereto.
12.4. Right of Setoff by Bank. Upon the occurrence of
an Event of Default, to the extent permitted by and in addition
to any other remedy provided by law, and regardless of the
adequacy of any collateral or other means of obtaining
repayment of the obligations evidenced hereby, Bank shall have
the right immediately and without notice or other act, and is
specifically authorized hereby, to setoff against any of the
undersigned's obligations under this Note any sum owed by Bank
or any Affiliate in any capacity to the undersigned whether due
or not, or any property of the undersigned in the possession of
Bank or any Affiliate, even if effecting such setoff results in
a loss or reduction of interest to the undersigned or the
imposition of a penalty applicable to the early withdrawal of
time deposits. Bank shall be deemed to have exercised such
right of setoff and to have made a charge against any such sum
or property immediately upon the occurrence of the Event of
Default, even though the actual book entries may be made at
some time subsequent.
12.5. Attorneys' Fees and Expenses. If Bank retains
the services of counsel by reason of a claim of a default or an
Event of Default hereunder or under any of the other Loan
Documents, or to institute and maintain an action to foreclose
the Mortgage or appoint a receiver of rents, or on account of
any matter involving this Note, or for examination of matters
subject to Bank's approval under the Loan Documents, all costs
of suit and collection and all reasonable attorneys' fees
(and/or allocated fees of Bank's in-house legal counsel) and
such other reasonable expenses so incurred by Bank shall
forthwith, on demand, become due and payable and shall be
evidenced hereby.
12.6. No Implied Waiver. Bank shall not be deemed to
have modified or waived any of its rights or remedies hereunder
unless such modification or waiver is in writing and signed by
Bank, and then only to the extent specifically set forth
therein. A waiver in one event shall not be construed as
continuing or as a waiver of or bar to such right or remedy on
a subsequent event. After any acceleration of, or the entry of
any judgment on, this Note, the acceptance by Bank of any
payments by or on behalf of the undersigned on account of the
indebtedness evidenced by this
Note shall not cure or be deemed to cure any Event of Default
or reinstate or be deemed to reinstate the terms of this Note
absent an express written agreement duly executed by Bank and
the undersigned.
12.7. Waiver. The undersigned, jointly and severally,
waives demand, notice, presentment, protest, demand for
payment, notice of dishonor, notice of protest and diligence of
collection of this Note. The undersigned consents to any and
all extensions of time, renewals, waivers, or modifications
that may be granted by Bank with respect to the payment or
other provisions of this Note, and to the release of any
collateral, with or without substitution. The undersigned
agrees that makers, endorsers, guarantors and sureties may be
added or released without notice and without affecting the
undersigned's liability hereunder. The liability of the
undersigned shall not be affected by the failure of Bank to
perfect or otherwise obtain or maintain the priority or
validity of any security interest in any collateral. The
liability of the undersigned shall be absolute and
unconditional and without regard to the liability of any other
party hereto.
12.8. No Usurious Amounts. Anything herein contained to
the contrary notwithstanding, the undersigned does not agree
and shall not be obligated to pay interest hereunder at a rate
which is in excess of the maximum rate permitted by law. If by
the terms of this Note, the undersigned is at any time required
to pay interest at a rate in excess of such maximum rate, the
rate of interest under this Note shall be deemed to be
immediately reduced to such maximum legal rate and the portion
of all prior interest payments in excess of such maximum legal
rate shall be applied to and shall be deemed to have been
payments in reduction of the outstanding principal balance.
The undersigned agrees that in determining whether or not any
interest payable under this Note exceeds the highest rate
permitted by law, any non-principal payment, including without
limitation, late charges, shall be deemed to the extent
permitted by law to be an expense, fee, premium or penalty
rather than interest.
12.9. Partial Invalidity. The invalidity or
unenforceability of any one or more provisions of this Note
shall not render any other provision invalid or unenforceable.
In lieu of any invalid or unenforceable provision, there shall
be added automatically a valid and enforceable provision as
similar in terms to such invalid or unenforceable provision as
may be possible.
12.10. Binding Effect. The covenants, conditions,
waivers, releases and agreements contained in this Note shall
bind, and the benefits thereof shall inure to, the parties
hereto and their respective heirs, executors, administrators,
successors and assigns; provided, however, that this Note
cannot be assigned by the undersigned without the prior written
consent of Bank, and any such assignment or attempted
assignment by the undersigned shall be void and of no effect
with respect to Bank.
12.11. Modifications. This Note may not be
supplemented, extended, modified or terminated except by an
agreement in writing signed by the party against whom
enforcement of any such waiver, change, modification or
discharge is sought.
12.12. Sales or Participations. Bank may from time to
time sell or assign, in whole or in part, or grant
participations in the Loan, this Note and/or the obligations
evidenced thereby. The holder of any such sale, assignment or
participation, if the applicable agreement between Bank and
such holder so provides, shall be: (a) entitled to all of the
rights, obligations and benefits of Bank; and (b) deemed to
hold and may exercise the rights of setoff or banker's lien
with respect to any and all obligations of such holder to the
undersigned, in each case as fully as though the undersigned
were directly indebted to such holder. Bank may in its
discretion give notice to the undersigned of such sale,
assignment or participation; however, the failure to give such
notice shall not affect any of Bank's or such holder's rights
hereunder.
12.13. Affiliate. As used herein, "Affiliate" shall
mean First Union Corporation and any of its direct and indirect
affiliates and subsidiaries.
12.14. Jurisdiction. The undersigned irrevocably
appoints each and every owner, partner and/or officer of the
undersigned as its attorneys upon whom may be served any
notice, process or pleading in any action or proceeding against
it arising out of or in connection with this Note or any other
Loan Document. The undersigned hereby consents that any action
or proceeding against it may be commenced and maintained in any
court within the State of Connecticut or in the United States
District Court for the District of Connecticut or, at the
option of Bank, any court in which Bank shall initiate legal or
equitable proceedings and which has subject matter jurisdiction
over the matter in controversy, and that such action or
proceeding may be commenced by service of process on any such
owner, partner and/or officer. The undersigned agrees that the
courts of the State of Connecticut and the United States
District Court for the District of Connecticut shall have
jurisdiction with respect to the subject matter hereof and the
person of the undersigned. The undersigned hereby further
consents to personal jurisdiction in any other court in which
Bank shall initiate legal or
equitable proceedings and which has subject matter jurisdiction
over the matter in controversy. The undersigned hereby waives
personal service of the summons and complaint or other process
or papers issued in any proceeding of the type described in
this Section 11.14 and agrees that service of such summons and
complaint, or other process or papers may be made by regular or
certified mail addressed to the undersigned at the address of
the undersigned set forth herein. The undersigned agrees not
to assert any defense to any proceeding initiated by Bank based
upon improper venue or inconvenient forum. The undersigned
agrees that any action brought by the undersigned shall be
commenced and maintained only in a court in the federal
judicial district or county in which Bank has a place of
business in Connecticut.
12.15. Notices. All notices and communications under
this Note shall be in writing and shall be given by either (a)
hand-delivery, (b) first class mail (postage prepaid), or (c)
reliable overnight commercial courier (charges prepaid), to the
addresses listed in the Loan Documents. Notice shall be deemed
to have been given and received: (i) if by hand delivery, upon
delivery; (ii) if by mail, three (3) calendar days after the
date first deposited in the United States mail; and (iii) if by
overnight courier, on the date scheduled for delivery. A party
may change its address by giving written notice to the other
party as specified herein.
12.16. Governing Law. This Note shall be governed by
and construed in accordance with the substantive laws of the
State of Connecticut without reference to conflict of laws
principles.
12.17. Waiver of Jury Trial. THE UNDERSIGNED AND BANK
AGREE THAT ANY SUIT, ACTION OR PROCEEDING, WHETHER CLAIM OR
COUNTERCLAIM, BROUGHT BY BANK OR THE UNDERSIGNED, ON OR WITH
RESPECT TO THIS NOTE OR ANY OTHER LOAN DOCUMENT OR THE DEALINGS
OF THE PARTIES WITH RESPECT HERETO OR THERETO, SHALL BE TRIED
ONLY BY A COURT AND NOT BY A JURY. BANK AND THE UNDERSIGNED
EACH HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY AND
INTELLIGENTLY, AND WITH THE ADVICE OF THEIR RESPECTIVE COUNSEL,
WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY SUCH SUIT, ACTION OR
PROCEEDING. FURTHER, THE UNDERSIGNED WAIVES ANY RIGHT IT MAY
HAVE TO CLAIM OR RECOVER, IN ANY SUCH SUIT, ACTION OR
PROCEEDING, ANY SPECIAL, EXEMPLARY, PUNITIVE, CONSEQUENTIAL OR
OTHER DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES.
THE UNDERSIGNED ACKNOWLEDGES AND AGREES THAT THIS SECTION IS A
SPECIFIC AND MATERIAL ASPECT OF THIS NOTE AND THAT BANK WOULD
NOT EXTEND CREDIT TO THE UNDERSIGNED IF THE WAIVERS SET FORTH
IN THIS SECTION WERE NOT A PART OF THIS NOTE.
12.18. Prejudgment Remedy Waiver. THE UNDERSIGNED
HEREBY REPRESENTS, COVENANTS AND AGREES THAT THE PROCEEDS OF
THE LOAN SHALL BE USED FOR GENERAL COMMERCIAL PURPOSES AND THAT
THE LOAN IS A "COMMERCIAL TRANSACTION" AS DEFINED BY THE
STATUTES OF THE STATE OF CONNECTICUT. THE UNDERSIGNED HEREBY
WAIVES ALL RIGHTS TO NOTICE AND PRIOR COURT HEARING OR COURT
ORDER UNDER CONNECTICUT GENERAL STATUTES, SECTIONS 52-278a et
seq., AS AMENDED, OR UNDER ANY OTHER STATE OR FEDERAL LAW WITH
RESPECT TO ANY AND ALL PREJUDGMENT REMEDIES BANK MAY EMPLOY TO
ENFORCE ITS RIGHTS AND REMEDIES HEREUNDER. MORE SPECIFICALLY,
THE UNDERSIGNED ACKNOWLEDGES THAT BANK'S ATTORNEY MAY, PURSUANT
TO CONNECTICUT GENERAL STATUTES, SECTION 52-278f, ISSUE A WRIT
FOR A PREJUDGMENT REMEDY WITHOUT SECURING A COURT ORDER. THE
UNDERSIGNED ACKNOWLEDGES AND RESERVES ITS RIGHT TO NOTICE AND A
HEARING SUBSEQUENT TO THE ISSUANCE OF A WRIT FOR PREJUDGMENT
REMEDY BY BANK'S ATTORNEY, AND BANK ACKNOWLEDGES THE
UNDERSIGNED'S RIGHT TO SAID HEARING SUBSEQUENT TO THE ISSUANCE
OF SAID WRIT. THE UNDERSIGNED FURTHER HEREBY WAIVES ANY
REQUIREMENT OR OBLIGATION OF BANK TO POST A BOND OR OTHER
SECURITY IN CONNECTION WITH ANY PREJUDGMENT REMEDY OBTAINED BY
BANK AND WAIVES ANY OBJECTIONS TO ANY PREJUDGMENT REMEDY
OBTAINED BY BANK BASED ON ANY OFFSETS, CLAIMS, DEFENSES OR
COUNTERCLAIMS OF THE UNDERSIGNED OR ANY OTHER OBLIGATED PARTY
TO ANY ACTION BROUGHT BY BANK. THE UNDERSIGNED ACKNOWLEDGES
AND AGREES THAT ALL OF THE WAIVERS CONTAINED IN THIS SECTION
HAVE BEEN MADE KNOWINGLY, VOLUNTARILY, INTENTIONALLY AND
INTELLIGENTLY, AND WITH THE ADVICE OF ITS COUNSEL.
IN WITNESS WHEREOF, the undersigned, intending to be
legally bound, has duly executed and delivered this Note as of
the day and year first above written.
WITNESS/ATTEST: ENERGY RESEARCH CORPORATION
By:
Name: Name:
Title: Title:
Address: 3 Great Pasture Road
Danbury, CT 06810
FOR INTERNAL USE ONLY
Obligor #________________
Obligation #_____________
Commercial Loan - CT
LIBOR Rate
TERM NOTE
$600,000.00 Bridgeport, Connecticut
June 28, 1996
FOR VALUE RECEIVED, the undersigned hereby promises to pay
to the order of FIRST UNION BANK OF CONNECTICUT (the "Bank"),
the principal sum of Six Hundred Thousand and no/100 Dollars
(the "Loan") in United States Dollars, together with interest
thereon as hereinafter provided.
1. INTEREST RATE. Interest shall be charged on the
outstanding principal balance from the date hereof until the
full amount of principal due hereunder has been paid at a rate
equal to LIBOR plus One Hundred Seventy-Five (175) basis points
("LIBOR-Based Rate"), as determined by Bank prior to the
commencement of each Interest Period. Interest shall be
calculated daily on the basis of the actual number of days
elapsed over a 360 day year. The LIBOR-Based Rate shall remain
in effect, subject to the provisions hereof, for the entire
Interest Period for which it is determined.
"LIBOR" means, with respect to each day during each
Interest Period, the rate (rounded to the next higher 1/100 of
1%) for U.S. dollar deposits of one month maturity as reported
on Telerate page 3750 as of 11:00 a.m., London time, on the
second London business day before the relevant Interest Period
begins (or if not so reported, then as determined by the Bank
from another recognized source or interbank quotation),
adjusted for reserves by dividing that rate by 1.00 minus the
LIBOR Reserve. "LIBOR Reserve" means the maximum percentage
reserve requirement (rounded to the next higher 1/100 of 1% and
expressed as a decimal) in effect for any day during the
Interest Period under the Federal Reserve Board's Regulation D
for Eurocurrency liabilities as defined therein.
"Interest Period" means, initially, the period commencing
on the date hereof and ending on the Commencement Date, and
thereafter, each period commencing on the last day of the
immediately preceding Interest Period and ending one month
thereafter, but in no event after the Maturity Date; subject,
however, to the following provisions: (i) if any Interest
Period would otherwise end on a day which is not a Business
Day, that Interest Period shall be extended to the next
succeeding Business Day unless the result of such extension
would be to carry such Interest Period into another calendar
month, in which event such Interest Period shall end on the
immediately preceding Business Day; (ii) any Interest Period
that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in
the calendar month at the end of such Interest Period) shall
end on the last Business Day of a calendar month; and (iii) the
last Interest Period shall end on the Maturity Date.
2. PAYMENT OF PRINCIPAL AND INTEREST. Interest only on the
outstanding principal balance from the date hereof to August 1,
1996 (the "Commencement Date") shall be due and payable on the
Commencement Date. Thereafter, principal and interest shall be
due and payable on the dates set forth in the Repayment
Schedule attached hereto and made a part hereof (the "Repayment
Schedule") in consecutive monthly installments in an amount
equal to the sum of (i) all then accrued and unpaid interest,
plus (ii) a principal payment in the amount set forth in the
Repayment Schedule. The entire unpaid principal amount hereof,
together with accrued and unpaid interest thereon and all other
amounts payable hereunder shall be due and payable on June 1,
1998 (the "Maturity Date").
3. APPLICATION OF PAYMENTS. Except as otherwise specified
herein, each payment or prepayment, if any, made under this
Note shall be applied to pay late charges, accrued and unpaid
interest,
principal, escrows (if any), and any other fees, costs and
expenses which the undersigned is obligated to pay under this
Note, in such order as Bank may elect from time to time in its
sole discretion.
4. TENDER OF PAYMENT. All payments made hereunder shall be
made on the due date thereof, in immediately available funds
and in lawful currency of the United States of America. All
payments made hereunder shall be made to the Bank at its
offices at 300 Main Street, Stamford, Connecticut 06904 or at
such other address as the Bank shall notify the Borrower of in
writing. The Borrower agrees to maintain an account at the
Bank continuously until all amounts due hereunder are paid in
full (the "Account"). The Bank may, and the Borrower
authorizes the Bank to, debit the Account for the amount of any
payment as and when such payment becomes due hereunder as more
fully described in that certain Authorization to Charge Account
from the undersigned to Bank of even date herewith. The
foregoing rights of the Bank to debit the Borrower's accounts
shall be in addition to, and not in limitation of, any rights
of set-off which the Bank may have hereunder or under any Loan
Document nor shall the rights hereunder limit the Bank's
recourse to any particular source of funds or monies.
5. PREPAYMENT. The Loan may be prepaid, in whole or in
part, on the last day of an Interest Period. Any prepayment
shall include accrued and unpaid interest to the date of
prepayment on the principal amount prepaid and all other sums
due and payable hereunder. All payments received on this Note
may be applied in such order as the Bank in its sole discretion
shall determine. The monthly principal installment shall not
be reamortized following a partial prepayment.
6. SECURITY FOR THE NOTE.
6.1. This Note is executed and delivered in accordance
with a commercial transaction described in a Loan Agreement
dated this date between the undersigned and Bank (the "Loan
Agreement"). As security for the payment of the monies owing
under this Note, the undersigned has delivered or has caused to
be delivered to Bank the following (each a "Loan Document" and
collectively with this Note, the Loan Agreement, and any other
guaranty, document, certificate or instrument executed by the
undersigned or any other obligated party in connection with the
Loan, the "Loan Documents"):
(a) a General Security Agreement from the undersigned;
(b) a Guaranty and Suretyship Agreement by Fuel Cell
Engineering Corporation and a Guaranty and Suretyship Agreement
by Energy Research Corporation (collectively, the "Guaranty");
(c) an Open-End Mortgage and Security Agreement (the
"Mortgage") from Energy Research Corporation on certain real
property and the improvements situated thereon in the City of
Danbury, County of Fairfield, State of Connecticut, as more
fully described in the Mortgage (the "Mortgaged Premises")
securing the Guaranty of Energy Research Corporation; and
(d) a General Security Agreement from Energy Research
Corporation securing the Guaranty of Energy Research
Corporation.
6.2. The undersigned hereby grants to Bank a continuing
security interest in all property of the undersigned, now or
hereafter in the possession of Bank or any Affiliate (as
defined below) in any capacity whatsoever, including, but not
limited to, any balance or share of any deposit, trust or
agency account, as security for the payment of this Note and
any other liabilities of the undersigned to Bank, which
security interest shall be enforceable and subject to all the
provisions of this Note, as if such property were specifically
pledged hereunder.
7. ADDITIONAL PAYMENTS; LATE CHARGE; DEFAULT RATE.
7.1. Additional Payments. In addition to the payments
provided for in Section 2 above, the undersigned promises to
pay on demand any additional monies required to be paid or
advanced by the undersigned or by any other party obligated
under any of the Loan Documents or paid or advanced on behalf
of the undersigned or such party by Bank pursuant to the terms
of the Loan Agreement, the Mortgage or any other Loan Document,
which obligation shall be continuing and shall survive any
judgment
entered with respect to this Note or a foreclosure of the
Mortgage. This Note shall evidence, and the Mortgage and other
Loan Documents shall secure the payment of, all such sums so
advanced or paid.
7.2. Late Charge. In the event that any installment of
principal or interest required to be made by the undersigned
under this Note shall not be received by Bank on or before its
due date, the undersigned shall pay to Bank, on demand, a late
charge of five percent (5%) of such delinquent payment for the
purpose of defraying the expense incident to the processing of
such delinquent payment. The foregoing right is in addition
to, and not in limitation of, any other rights which Bank may
have upon the undersigned's failure to make timely payment of
any amount due hereunder.
7.3. Default Rate. Except as otherwise provided below,
from and after the occurrence of an Event of Default hereunder,
all amounts remaining unpaid or thereafter accruing hereunder,
as well as any amounts owing under Section 7.1., shall, at
Bank's option, bear interest at a default rate of four percent
(4%) per annum above the interest rate then in effect as set
forth herein, or the highest permissible rate under applicable
law, whichever is less. If the Loan is not paid when due,
whether at the Maturity Date, upon acceleration, or otherwise,
all amounts remaining unpaid or thereafter accruing hereunder
shall bear interest at a default rate equal to the Bank's Prime
Rate plus four percent (4.0%), or the highest permissible rate
under applicable law, whichever is less (such rate and the rate
specified in the immediately preceding sentence are each
hereinafter referred to as a "Default Rate"). As used herein,
"Prime Rate" means the rate of interest established by the Bank
as its reference rate in making loans, and is not tied to any
external rate of interest or index. Each change in the Prime
Rate shall be effective automatically and immediately without
notice to the Borrower. The applicable Default Rate of
interest shall be payable upon demand, but in no event later
than when scheduled interest payments are due, and shall also
be charged on the amounts owed by the undersigned to Bank
pursuant to any judgments entered in favor of Bank with respect
to this Note and shall continue to accrue after judgment until
collection.
8. INDEMNIFICATION; ADDITIONAL COSTS; UNAVAILABILITY OF
RATE.
8.1. Indemnification. The undersigned shall indemnify
Bank against Bank's loss or expense in employing deposits as a
consequence of (i) the undersigned's failure to make any
payment when due under this Note, or (ii) any prepayment of the
Loan on a date other than the last day of an Interest Period
("Indemnified Loss or Expense").
8.2. Additional Costs. If, at any time, a new, or a
revision in any existing law or interpretation or
administration (including reversals) thereof by any government
authority, central bank or comparable agency imposes, increases
or modifies any reserve or similar requirement against assets,
deposits or credit extended by Bank, or subjects Bank to any
tax, duty or other charge (except tax on Bank's net income),
and any of the foregoing increase the cost to Bank of
maintaining its commitment or reduce the amount of any sum
received or receivable by Bank under this Note, within 15 days
after demand by Bank, the undersigned agrees to pay Bank such
additional amounts as will compensate Bank for such increased
costs or reductions ("Additional Costs").
8.3. Match Funding. The amount of such (i) Indemnified
Loss or Expense, or (ii) Additional Costs outlined above shall
be determined, in Bank's sole discretion, based upon the
assumption that Bank funded 100% of that portion of the Loan to
which the LIBOR-Based Rate applies in the applicable London
interbank market.
8.4. Unavailability of Interest Rate. If, at any time,
(i) Bank shall determine that, by reason of circumstances
affecting foreign exchange and interbank markets generally,
LIBOR deposits in the applicable amounts are not being offered
to Bank; or (ii) a new, or a revision in any existing law or
interpretation or administration (including reversals) thereof
by any government authority, central bank or comparable agency
shall make it unlawful or impossible for Bank to honor its
obligations under this Note, then (A) Bank's obligation to make
or maintain a LIBOR-Based Rate shall be suspended, and (B) the
applicable LIBOR-Based Rate shall immediately be converted to
the Prime Rate for the remainder of the term of the Loan.
"Prime Rate" means the rate of interest established by Bank as
its reference rate in making loans, and is not tied to any
external rate of interest or index. The rate of interest
charged under the Note following conversion to the Prime Rate
shall change automatically and immediately as of the date of
any change in the Prime Rate without notice to the undersigned.
9. EVENTS OF DEFAULT. Each of the following shall
constitute an event of default hereunder (an "Event of
Default"): (a) the failure of the undersigned to make any
installment of principal or interest hereunder when due and
payable; or (b) the occurrence of any other default in any
term, covenant or condition hereunder or any Event of Default
under the Loan Agreement, the Mortgage or any other Loan
Document.
10. REMEDIES. If an Event of Default exists, Bank may
exercise any right, power or remedy permitted by law or as set
forth herein or in the Loan Agreement, the Mortgage or any
other Loan Document including, without limitation, the right to
declare the entire unpaid principal amount hereof and all
interest accrued hereon, and all other sums secured by the
Mortgage or any other Loan Document to be, and such principal,
interest and other sums shall thereupon become, forthwith due
and payable.
11. CONTINUING ENFORCEMENT OF NOTE. If, after receipt of any
payment of all or any part of this Note, Bank is compelled or
agrees, for settlement purposes, to surrender such payment to
any person or entity for any reason (including, without
limitation, a determination that such payment is void or
voidable as a preference or fraudulent conveyance, an
impermissible setoff, or a diversion of trust funds), then this
Note and the other Loan Documents shall continue in full force
and effect or be reinstated, as the case may be, and the
undersigned shall be liable for, and shall indemnify, defend
and hold harmless Bank with respect to the full amount so
surrendered. The provisions of this Section shall survive the
cancellation or termination of this Note and shall remain
effective notwithstanding the payment of the obligations
evidenced hereby, the release of any security interest, lien or
encumbrance securing this Note or any other action which Bank
may have taken in reliance upon its receipt of such payment.
Any cancellation, release or other such action shall be deemed
to have been conditioned upon any payment of the obligations
evidenced hereby having become final and irrevocable.
12. MISCELLANEOUS.
12.1. Disclosure of Financial Information. Bank is
hereby authorized to disclose any financial or other
information about the undersigned to any regulatory body or
agency having jurisdiction over Bank or to any present, future
or prospective participant or successor in interest in any loan
or other financial accommodation made by Bank to the
undersigned. The information provided may include, without
limitation, amounts, terms, balances, payment history, return
item history and any financial or other information about the
undersigned. The undersigned agrees to indemnify, defend,
release Bank, and hold Bank harmless, at the undersigned's cost
and expense, from and against any and all lawsuits, claims,
actions, proceedings, or suits against Bank or against the
undersigned and Bank, arising out of or relating to Bank's
reporting or disclosure of such information. Such indemnity
shall survive the repayment or other satisfaction of the
obligations evidenced hereby.
12.2. Remedies Cumulative. The rights and remedies of
Bank as provided herein and in any other Loan Document shall be
cumulative and concurrent, may be pursued separately,
successively or together against the undersigned or the
Mortgaged Premises or any other collateral security for payment
of amounts due hereunder, or any guarantor thereof, at the sole
discretion of Bank, may be exercised as often as occasion
therefor shall arise, and shall be in addition to any other
rights or remedies conferred upon Bank at law or in equity.
The failure, at any one or more times, of Bank to exercise any
such right or remedy shall in no event be construed as a waiver
or release thereof. Bank shall have the right to take any
action it deems appropriate without the necessity of resorting
to any collateral securing this Note.
12.3. Integration. This Note and the other Loan
Documents constitute the sole agreement of the parties with
respect to the transaction contemplated hereby and supersede
all oral negotiations and prior writings with respect thereto.
12.4. Right of Setoff by Bank. Upon the occurrence of
an Event of Default, to the extent permitted by and in addition
to any other remedy provided by law, and regardless of the
adequacy of any collateral or other means of obtaining
repayment of the obligations evidenced hereby, Bank shall have
the right immediately and without notice or other act, and is
specifically authorized hereby, to setoff against any of the
undersigned's obligations under this Note any sum owed by Bank
or any Affiliate in any capacity to the undersigned whether due
or not, or any property of the undersigned in the possession of
Bank or
any Affiliate, even if effecting such setoff results in a loss
or reduction of interest to the undersigned or the imposition
of a penalty applicable to the early withdrawal of time
deposits. Bank shall be deemed to have exercised such right of
setoff and to have made a charge against any such sum or
property immediately upon the occurrence of the Event of
Default, even though the actual book entries may be made at
some time subsequent.
12.5. Attorneys' Fees and Expenses. If Bank retains the
services of counsel by reason of a claim of a default or an
Event of Default hereunder or under any of the other Loan
Documents, or to institute and maintain an action to foreclose
the Mortgage or appoint a receiver of rents, or on account of
any matter involving this Note, or for examination of matters
subject to Bank's approval under the Loan Documents, all costs
of suit and collection and all reasonable attorneys' fees
(and/or allocated fees of Bank's in-house legal counsel) and
such other reasonable expenses so incurred by Bank shall
forthwith, on demand, become due and payable and shall be
evidenced hereby.
12.6. No Implied Waiver. Bank shall not be deemed to
have modified or waived any of its rights or remedies hereunder
unless such modification or waiver is in writing and signed by
Bank, and then only to the extent specifically set forth
therein. A waiver in one event shall not be construed as
continuing or as a waiver of or bar to such right or remedy on
a subsequent event. After any acceleration of, or the entry of
any judgment on, this Note, the acceptance by Bank of any
payments by or on behalf of the undersigned on account of the
indebtedness evidenced by this Note shall not cure or be deemed
to cure any Event of Default or reinstate or be deemed to
reinstate the terms of this Note absent an express written
agreement duly executed by Bank and the undersigned.
12.7. Waiver. The undersigned, jointly and severally,
waives demand, notice, presentment, protest, demand for
payment, notice of dishonor, notice of protest and diligence of
collection of this Note. The undersigned consents to any and
all extensions of time, renewals, waivers, or modifications
that may be granted by Bank with respect to the payment or
other provisions of this Note, and to the release of any
collateral, with or without substitution. The undersigned
agrees that makers, endorsers, guarantors and sureties may be
added or released without notice and without affecting the
undersigned's liability hereunder. The liability of the
undersigned shall not be affected by the failure of Bank to
perfect or otherwise obtain or maintain the priority or
validity of any security interest in any collateral. The
liability of the undersigned shall be absolute and
unconditional and without regard to the liability of any other
party hereto.
12.8. No Usurious Amounts. Anything herein contained to
the contrary notwithstanding, the undersigned does not agree
and shall not be obligated to pay interest hereunder at a rate
which is in excess of the maximum rate permitted by law. If by
the terms of this Note, the undersigned is at any time required
to pay interest at a rate in excess of such maximum rate, the
rate of interest under this Note shall be deemed to be
immediately reduced to such maximum legal rate and the portion
of all prior interest payments in excess of such maximum legal
rate shall be applied to and shall be deemed to have been
payments in reduction of the outstanding principal balance.
The undersigned agrees that in determining whether or not any
interest payable under this Note exceeds the highest rate
permitted by law, any non-principal payment, including without
limitation, late charges, shall be deemed to the extent
permitted by law to be an expense, fee, premium or penalty
rather than interest.
12.9. Partial Invalidity. The invalidity or
unenforceability of any one or more provisions of this Note
shall not render any other provision invalid or unenforceable.
In lieu of any invalid or unenforceable provision, there shall
be added automatically a valid and enforceable provision as
similar in terms to such invalid or unenforceable provision as
may be possible.
12.10. Binding Effect. The covenants, conditions,
waivers, releases and agreements contained in this Note shall
bind, and the benefits thereof shall inure to, the parties
hereto and their respective heirs, executors, administrators,
successors and assigns; provided, however, that this Note
cannot be assigned by the undersigned without the prior written
consent of Bank, and any such assignment or attempted
assignment by the undersigned shall be void and of no effect
with respect to Bank.
12.11. Modifications. This Note may not be supplemented,
extended, modified or terminated except by an agreement in
writing signed by the party against whom enforcement of any
such waiver, change, modification or discharge is sought.
12.12. Sales or Participations. Bank may from time to
time sell or assign, in whole or in part, or grant
participations in the Loan, this Note and/or the obligations
evidenced thereby. The holder of any such sale, assignment or
participation, if the applicable agreement between Bank and
such holder so provides, shall be: (a) entitled to all of the
rights, obligations and benefits of Bank; and (b) deemed to
hold and may exercise the rights of setoff or banker's lien
with respect to any and all obligations of such holder to the
undersigned, in each case as fully as though the undersigned
were directly indebted to such holder. Bank may in its
discretion give notice to the undersigned of such sale,
assignment or participation; however, the failure to give such
notice shall not affect any of Bank's or such holder's rights
hereunder.
12.13. Affiliate. As used herein, "Affiliate" shall mean
First Union Corporation and any of its direct and indirect
affiliates and subsidiaries.
12.14. Jurisdiction. The undersigned irrevocably
appoints each and every owner, partner and/or officer of the
undersigned as its attorneys upon whom may be served any
notice, process or pleading in any action or proceeding against
it arising out of or in connection with this Note or any other
Loan Document. The undersigned hereby consents that any action
or proceeding against it may be commenced and maintained in any
court within the State of Connecticut or in the United States
District Court for the District of Connecticut or, at the
option of Bank, any court in which Bank shall initiate legal or
equitable proceedings and which has subject matter jurisdiction
over the matter in controversy, and that such action or
proceeding may be commenced by service of process on any such
owner, partner and/or officer. The undersigned agrees that the
courts of the State of Connecticut and the United States
District Court for the District of Connecticut shall have
jurisdiction with respect to the subject matter hereof and the
person of the undersigned. The undersigned hereby further
consents to personal jurisdiction in any other court in which
Bank shall initiate legal or equitable proceedings and which
has subject matter jurisdiction over the matter in controversy.
The undersigned hereby waives personal service of the summons
and complaint or other process or papers issued in any
proceeding of the type described in this Section 11.14 and
agrees that service of such summons and complaint, or other
process or papers may be made by regular or certified mail
addressed to the undersigned at the address of the undersigned
set forth herein. The undersigned agrees not to assert any
defense to any proceeding initiated by Bank based upon improper
venue or inconvenient forum. The undersigned agrees that any
action brought by the undersigned shall be commenced and
maintained only in a court in the federal judicial district or
county in which Bank has a place of business in Connecticut.
12.15. Notices. All notices and communications under
this Note shall be in writing and shall be given by either (a)
hand-delivery, (b) first class mail (postage prepaid), or (c)
reliable overnight commercial courier (charges prepaid), to the
addresses listed in the Loan Documents. Notice shall be deemed
to have been given and received: (i) if by hand delivery, upon
delivery; (ii) if by mail, three (3) calendar days after the
date first deposited in the United States mail; and (iii) if by
overnight courier, on the date scheduled for delivery. A party
may change its address by giving written notice to the other
party as specified herein.
12.16. Governing Law. This Note shall be governed by and
construed in accordance with the substantive laws of the State
of Connecticut without reference to conflict of laws
principles.
12.17. Waiver of Jury Trial. THE UNDERSIGNED AND BANK
AGREE THAT ANY SUIT, ACTION OR PROCEEDING, WHETHER CLAIM OR
COUNTERCLAIM, BROUGHT BY BANK OR THE UNDERSIGNED, ON OR WITH
RESPECT TO THIS NOTE OR ANY OTHER LOAN DOCUMENT OR THE DEALINGS
OF THE PARTIES WITH RESPECT HERETO OR THERETO, SHALL BE TRIED
ONLY BY A COURT AND NOT BY A JURY. BANK AND THE UNDERSIGNED
EACH HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY AND
INTELLIGENTLY, AND WITH THE ADVICE OF THEIR RESPECTIVE COUNSEL,
WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY SUCH SUIT, ACTION OR
PROCEEDING. FURTHER, THE UNDERSIGNED WAIVES ANY RIGHT IT MAY
HAVE TO CLAIM OR RECOVER, IN ANY SUCH SUIT, ACTION OR
PROCEEDING, ANY SPECIAL, EXEMPLARY, PUNITIVE, CONSEQUENTIAL OR
OTHER DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES.
THE UNDERSIGNED ACKNOWLEDGES AND AGREES THAT THIS SECTION IS A
SPECIFIC AND MATERIAL ASPECT OF THIS NOTE AND THAT BANK WOULD
NOT EXTEND CREDIT TO THE UNDERSIGNED IF THE WAIVERS SET FORTH
IN THIS SECTION WERE NOT A PART OF THIS NOTE.
12.18. Prejudgment Remedy Waiver. THE UNDERSIGNED HEREBY
REPRESENTS, COVENANTS AND AGREES THAT THE PROCEEDS OF THE LOAN
SHALL BE USED FOR GENERAL COMMERCIAL PURPOSES AND THAT THE LOAN
IS A "COMMERCIAL TRANSACTION" AS DEFINED BY THE STATUTES OF THE
STATE OF CONNECTICUT. THE UNDERSIGNED HEREBY WAIVES ALL RIGHTS
TO NOTICE AND PRIOR COURT HEARING OR COURT ORDER UNDER
CONNECTICUT GENERAL STATUTES, SECTIONS 52-278a et seq., AS
AMENDED, OR UNDER ANY OTHER STATE OR FEDERAL LAW WITH RESPECT
TO ANY AND ALL PREJUDGMENT REMEDIES BANK MAY EMPLOY TO ENFORCE
ITS RIGHTS AND REMEDIES HEREUNDER. MORE SPECIFICALLY, THE
UNDERSIGNED ACKNOWLEDGES THAT BANK'S ATTORNEY MAY, PURSUANT TO
CONNECTICUT GENERAL STATUTES, SECTION 52-278f, ISSUE A WRIT FOR
A PREJUDGMENT REMEDY WITHOUT SECURING A COURT ORDER. THE
UNDERSIGNED ACKNOWLEDGES AND RESERVES ITS RIGHT TO NOTICE AND A
HEARING SUBSEQUENT TO THE ISSUANCE OF A WRIT FOR PREJUDGMENT
REMEDY BY BANK'S ATTORNEY, AND BANK ACKNOWLEDGES THE
UNDERSIGNED'S RIGHT TO SAID HEARING SUBSEQUENT TO THE ISSUANCE
OF SAID WRIT. THE UNDERSIGNED FURTHER HEREBY WAIVES ANY
REQUIREMENT OR OBLIGATION OF BANK TO POST A BOND OR OTHER
SECURITY IN CONNECTION WITH ANY PREJUDGMENT REMEDY OBTAINED BY
BANK AND WAIVES ANY OBJECTIONS TO ANY PREJUDGMENT REMEDY
OBTAINED BY BANK BASED ON ANY OFFSETS, CLAIMS, DEFENSES OR
COUNTERCLAIMS OF THE UNDERSIGNED OR ANY OTHER OBLIGATED PARTY
TO ANY ACTION BROUGHT BY BANK. THE UNDERSIGNED ACKNOWLEDGES
AND AGREES THAT ALL OF THE WAIVERS CONTAINED IN THIS SECTION
HAVE BEEN MADE KNOWINGLY, VOLUNTARILY, INTENTIONALLY AND
INTELLIGENTLY, AND WITH THE ADVICE OF ITS COUNSEL.
IN WITNESS WHEREOF, the undersigned, intending to be
legally bound, has duly executed and delivered this Note as of
the day and year first above written.
WITNESS/ATTEST: FUEL CELL MANUFACTURING CORPORATION
By:
Name: Name:
Title: Title:
Address: