EXHIBIT 10.70
THIS LOAN AGREEMENT dated as of January 10,2002, by and between the
NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY (the "Authority"), a public body
corporate and politic constituting an instrumentality of the State of New
Jersey Department of Environmental Protection ( the "Department") regarding
the disbursement of financial assistance monies from the Hazardous
Discharge Site Remediation Fund (the "Fund") pursuant to P.L. 1993, C.139
and the provisions of N.J.A.C. 19:31-8.1, et seq. (the "Fund Regulations")
and IGI, INC., a corporation organized and existing under the laws of the
State of Delaware (the "Borrower").
IT IS AGREED THAT:
Section 1. THE LOAN. The Authority agrees on the terms and
conditions of this Loan Agreement to make a loan (the "Loan") to the
Borrower in the principal amount of Two Hundred Forty-Five Thousand Five
Hundred Fifty-Six Dollars ($245,556) for remedial action (the "Project").
Section 2. THE NOTE. The Loan shall be evidenced by a Promissory
Note substantially in the form attached as Exhibit "A" (the "Note"). The
Loan shall be repaid over a term of ten (10) years in one hundred twenty
(120) equal monthly installments as provided in the Note and shall bear
interest on the unpaid principal balance from the date of the Note until
payment in full of the entire principal amount, at a fixed rate of interest
of five percent (5%) per annum. The Borrower may prepay the Note in whole
at any time or in part on any payment date without penalty. Partial
prepayments shall be applied to the last maturing payments due on the Note,
shall be in one or more increments of the monthly amount due on principal,
shall not extend or postpone the due date of any subsequent monthly
installment or change the amounts of such installments unless the holder of
the Note shall otherwise expressly agree in writing. There shall be due and
owing by the Borrower a late charge of five percent (5%) of any monthly
payment on any such payment which is seven (7) days or more past due.
However, in the event that this late charge is found unenforceable by a
court of law, the Borrower shall pay actual damages to the Authority which
shall include but not be limited to the loss of use of the delinquent
payment(s) and administrative costs in monitoring the default by the
Borrower. Administrative costs include but are not limited to attempts to
contact the Borrower via written and letter correspondence, generating and
reviewing the delinquency reports, evaluating the delinquent account,
evaluating the credit file, entering relevant information into the
Authority's file and/or computer, relaying information to management and
different departments, notifying and reporting to management and different
departments.
Section 3. SECURITY. As security for the Note, and for any other
loans, advances, credits, indebtedness, obligations and liabilities of any
kind of Borrower to the Authority, now or
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hereafter existing, whether absolute or contingent, due or to become due,
direct or indirect, liquidated or unliquidated and however, incurred or
arising, the Borrower shall grant to the Authority a mortgage (the
"Mortgage") on certain real property located at 701 Harding Highway, Buena,
New Jersey (the "Project Site") which when filed in the appropriate
recording office shall constitute a third mortgage on the Project Site.
The Loan Agreement, the Note, any and all security agreements,
mortgages, financing statements and any and all other documents executed in
connection with Loan shall hereinafter be defined as the "Loan Documents."
Section 4. DISBURSEMENT OF THE LOAN. The Loan shall be disbursed by
the Authority upon receipt of the following:
(a) requisition of the form attached as Exhibit "B" signed by an
authorized representative of the Borrower stating the name of the person,
firm or corporatin to whom payment is to be made and the amount to be paid;
(b) all documents, searches, opinions, evidence of insurance and
guarantees as required by the Authority commitment letter dated June 26,
2001 as amended attached as Exhibit "C".
Notwithstanding anything herein to the contrary, Borrower understands
and agrees the Authority shall be under no obligation to make any
disbursement with respect to which a requisition has been submitted by
Borrower if, at the time of said submission, Borrower is in default under
Section 15 of this Loan Agreement.
Section 5. INSURANCE. The Borrower agrees to insure the Project
Site with insurance companies licensed to do business in New Jersey in such
a manner and against such loss, damage and liability to third parties as is
customary with companies in the same or similar business. The Borrower
shall at all times carry general liability insurance with companies
licensed to do business in New Jersey in amounts approved by the Authority
and naming the Authority as additional insured. With respect to the Project
Site, the Borrower shall carry at all times with companies licensed to do
business in New Jersey full extended coverage fire, theft and hazard
insurance in an amount approved by the Authority. Such extended coverage
shall name the Authority as mortgagee and shall contain a provision that
such policy may not be canceled or materially altered except upon at least
fifteen (15) days written notice to the Authority and shall not contain a
provision for deductible amounts greater than $5,000. In the event of loss
or damage to any portion of the Project Site, the proceeds of any insurance
shall be deposited with the Authority and applied as set forth in Section
6. At least
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ten (10) days prior to the expiration of any such policy the Borrower shall
furnish evidence satisfactory to the Authority that such policy has been
renewed or replaced or is no longer required by this Loan Agreement.
At all times during the term of this Loan Agreement, the Borrower
shall comply with the laws of New Jersey relating to Worker's Compensation
Insurance.
Section 6. DAMAGE, DESTRUCTION AND CONDEMNATION.
(a) If the Project shall be damaged or either partially or totally
destroyed or if title to or the temporary use of the whole or any part of
the Project Site shall be taken or condemned by a competent authority for
any public use or purpose, there shall be no abatement or reduction in the
amounts payable by the Borrower under this Loan Agreement or under the
Note.
(b) In the event of any damage, destruction, taking or condemnation,
the proceeds from any insurance or condemnation award shall be deposited
with the Authority and applied to the payment of any amounts due on the
Loan unless the Borrower and the Authority shall agree to apply the
proceeds to the repair, reconstruction, replacement or relocation of the
Project Site.
Section 7. FINANCIAL STATEMENTS. The Borrower agrees to furnish to
the Authority:
(a) within 15 days of filing, signed copies of annual 10K federal
income tax returns for the Borrower; and
(b) deliver to the Authority concurrently with the annual 10K
returns, a certificate of the Borrower stating that:
(i) all taxes, assessments and charges which have become due
have been paid or specifying which have not been paid and
stating why they remain so; and
(ii) the Borrower has not failed to comply with any obligations
under this Loan Agreement or specifying any such failure and
the reasons for such failure.
In addition, the Borrower must furnish the Authority with evidence
that all current taxes and assessments regarding the Project Site have been
paid.
Section 8. REPRESENTATIONS AND WARRANTIES BY THE BORROWER. Borrower
hereby makes the following representations and warranties and acknowledges
and agrees that each and every one of the following
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representations and warranties shall survive closing and shall continue for
as long as the Loan remains outstanding:
(a) The Borrower has been duly organized and validly exists as a
corporation under the laws of the State of Delaware, has power to enter
into this Loan Agreement and the Note evidencing the debt obligation of the
Borrower to the Authority hereunder and has authorized the taking of all
action necessary to carry out and give effect to the transactions
contemplated by this Loan Agreement.
(b) There is no action or proceeding pending or threatened against
the Borrower before any court or administrative agency that might adversely
affect the ability of the Borrower to perform its obligations under this
Loan Agreement and all authorizations, consents and approvals of
governmental bodies or agencies, required in connection with the
performance of the Borrower's obligations hereunder have been obtained and
will be obtained whenever required hereunder or by law.
(c) Neither the execution and delivery of this Loan Agreement, the
consummation of the transactions contemplated hereby, nor the fulfillment
of or compliance with the terms and conditions of this Loan Agreement is
prevented, limited by, or conflicts with or results in a breach of, the
terms, conditions, or provisions of any corporate restrictions or any
evidence of indebtedness, agreement or instrument of whatever nature to
which the Borrower is now a party or by which it is bound, or constitutes a
default under any of the foregoing.
(d) All tax returns and reports of the Borrower required by law to
be filed have been duly filed and all taxes, assessments, fees and other
governmental charges upon the Borrower or upon any of its respective
properties, assets, income or franchises which are due and payable pursuant
to such returns and reports, or pursuant to any assessment received by the
Borrower have been paid other than those which may be presently payable
without penalty or interest.
(e) There has been no material adverse change in the aggregate
assets or aggregate liabilities or in the condition, financial or
otherwise, of the Borrower from that set forth in the financial statements
delivered to the Authority by the Borrower in connection with this Loan
Agreement.
(f) All statements, representations and warranties made by the
Borrower in its application to the Department, and any materials furnished
in support of the request for financial assistance and this Loan Agreement
are true. It is specifically understood by the Borrower that all such
statements, representations and warranties shall be deemed to have been
relied upon by the Department and the Authority as an inducement to make
the Loan and that if any such
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statements, representations or warranties were materially false at the time
they were made or are breached during the term hereof, the Authority may,
in its sole discretion, consider any such misrepresentation or breach an
event of default including without limitation, the Borrower's
representation that it would not have been able to proceed with the Project
without financial assistance from the Fund.
(g) Borrower represents to the Authority that it has at all times
pertinent to this Loan Agreement been represented by advisors of its own
selection, including but not limited to attorneys-at-law and/or certified
public accountants; that it has not relied upon any statement,
representation, warranty, agreement or information provided by the
Department or the Authority, its employees, agents or attorneys; that it
acknowledges that it is informed by its advisors of its respective rights,
duties, and obligations with respect to the Loan under all applicable laws,
that it has no set-offs, defenses or counterclaims against the Department
or the Authority with respect to the Loan, and that it is indebted to the
Authority for the amounts stated in this Loan Agreement.
(h) Borrower further acknowledges and agrees that the Department and
the Authority has made no statements, representations, warranties,
agreements or provided information to it in order to induce the execution
of this Loan Agreement. Borrower further acknowledges and agrees that all
agreements of the parties are set forth in this Loan Agreement or in the
financing documents executed by Borrower prior to or on even date hereof.
(i) If during any time the Loan remains outstanding, the Borrower
becomes aware of any facts, occurrences, information, statements, or events
that render any of the foregoing representations or warranties herein made
untrue or materially misleading or incomplete, Borrower shall immediately
notify the Authority in writing of such facts, occurrences, information,
statements or events.
Section 9. REMEDIATION OF PROJECT SITE. The Borrower shall perform
the remediation of the Project Site as set forth in its application to the
Department pursuant to the Fund Regulations.
Section 10. TAXES AND OTHER GOVERNMENTAL CHARGES. The Borrower
shall pay during the term of this Loan Agreement as the same become due,
all taxes, assessments and governmental charges which may be required by
law or contract to be paid by the Borrower. The Borrower may in good faith
contest such taxes and governmental charges and such taxes and charges may
remain unpaid during the period of such contest provided the Project Site
will not be subject to loss or forfeiture as a result.
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Section 11. MAINTENANCE OF ASSETS.
(a) The Borrower shall during the term of this Loan Agreement
operate and maintain all assets of the Borrower in compliance with all
governmental laws, ordinances, approvals, rules and regulations which are
acceptable to and binding upon the Borrower.
(b) The Borrower will not relocate all or any substantial part of
its business operation from the Project Site without the express prior
written consent of the Authority.
Section 12. ASSIGNMENT OF AGREEMENT, SALE OR LEASE OF PROJECT SITE.
The Borrower may not assign or transfer the whole or any part of this Loan
Agreement. The Borrower may not sell, lease, convey, assign, transfer or
otherwise dispose of any use or possessory interest in the Project Site
without the express prior written consent of the Authority except that the
Borrower may grant utility, access and other easements and rights-of-way
which will not impair the Borrower's use of the Project Site. The Authority
reserves the right to deny approval of any proposed lease, sublease,
assignment or transfer if the lessee, sublessee or assignee does not, in
the judgment of the the Authority, satisfy guidelines for eligibility for
Authority financial assistance. No permitted subleasing or assignment shall
relieve the Borrower from primary liability hereunder.
The actual principal amount of the Loan remaining unpaid together
with interest thereon shall be immediately due and payable upon the
transfer of ownership of the Project Site.
Section 13. THE BORROWER TO MAINTAIN ITS EXISTENCE. During the term
of this Loan Agreement the Borrower shall maintain its existence, shall
continue as a corporation either organized under the laws of or duly
qualified to do business as a corporation in the State of New Jersey, and
without prior written consent of the Authority shall not dispose of all or
substantially all of its assets and shall not consolidate with or merge
into another entity or permit one or more other entities to consolidate
with or merge into it.
Section 14. ADDITIONAL COVENANTS.
(a) The Borrower shall not, without the express prior written
consent of the Authority:
(i) issue any additional stock;
(ii) declare cash or stock dividends (except for Sub-Chapter S
corporations);
(iii) purchase its own stock for value; or
(iv) transfer any excess funds of the Borrower, its affiliates
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or subsidiaries for investment in any other business venture.
The term "business venture" does not include bank accounts or
certificates of deposit.
(b) The Borrower shall make no material or substantial changes in
the present management or operating control of the Borrower without the
express prior written consent of the Authority.
(c) The Borrower shall not borrow any additional funds, guarantee
additional obligations or grant any additional liens on the Project Site
(except for existing liens held by Fleet Capital Corporation to secure $22
million and American Capital Strategies, LTD to secure $7 million) without
the express prior written consent of the Authority.
(d) The Borrower shall permit representatives of the Authority and
the Department to examine all books and records of the Borrower and to
inspect the Project at reasonable times.
(e) The Authority shall receive prior to closing a copy of a
detailed contract regarding the remediation activities for which this Loan
is being made.
(f) The Borrower shall complete the Project substantially as set
forth in its request for financial assistance.
(g) Borrower agrees to comply, in all material respects with all
applicable Federal, State, County and Municipal laws, ordinances, rules and
regulations now in force or that may be enacted hereafter pertaining to the
operation, conduct and maintenance of the Project and its existence and
business including, without limitation, all Federal, State and local laws
relating to benefit plans, environmental, safety, zoning, or health
matters, and hazardous or liquid waste or chemicals or other liquids
(including use, sale transport and disposal thereof.
(h) The Borrower agrees that the Authority shall have a right, but
no obligation, to have representatives present at all regular and special
meetings of the Borrower's Board of Directors. The Borrower shall give
sufficient prior written notice to the Authority of all such meetings.
(i) This financing shall be subject to the Borrower's compliance
with the statutory and regulating requirements under the Industrial Site
Recovery Act and with all applicable federal statutory or regulating
requirements.
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Section 15. EVENT OF DEFAULT. Any one or more of the following
events shall constitute an event of default under this Loan Agreement (an
"Event of Default"):
(a) if any representation or warranty made by the Borrower or any
other party to any of the Loan Documents, made in connection with the Loan,
or in any report, certificate, financial statement or other instrument
furnished in connection with the Loan shall prove to be false or misleading
in any material respect;
(b) default by the Borrower in the payment of any installment of the
principal or interest on the Note and such default shall continue
unremedied for fifteen (15) days;
(c) failure of the Borrower to comply with the Fund Regulations;
(d) failure of the Borrower or any other party to observe and
perform any other covenant, condition or agreement on the part of the
Borrower or such party to be observed or performed pursuant to the terms of
the Loan Documents (except the obligations referred to in (a) and (c)
above) and (i) continuance of such failure for a period of thirty (30) days
after receipt by the Borrower of written notice by the Department to the
Borrower or such party, specifying the nature of such failure and
requesting that it be remedied; or (ii) if by reason of the nature of such
failure the same cannot be remedied within the said 30 days, the Borrower
fails to proceed with reasonable diligence after receipt of said notice to
cure same;
(e) the Borrower shall have applied for or consented to the
appointment of a receiver, trustee or liquidator of all or a substantial
part of its assets; a custodian shall have been appointed with or without
consent of the Borrower; the Borrower shall generally not be paying its
debts as they become due; the Borrower shall have made a general assignment
to for the benefit of creditors; Borrower shall have been adjudged a
bankrupt, or filed a petition or an answer seeking an arrangement with
creditors or taken advantage of any insolvency law, or an answer admitting
the material allegations of a petition in bankruptcy or insolvency
proceeding; or an order, judgment or decree shall have been entered,
without the application, approval or consent of the Borrower by any court
of competent jurisdiction approving a petition seeking reorganization of
the Borrower, or appointing a receiver, custodian, trustee or liquidator of
the Borrower or a substantial part of any of its assets and such order,
judgment or decree shall continue unstayed and in effect for any period of
forty-five (45) consecutive days; or the Borrower shall have filed a
voluntary petition in bankruptcy or failed to remove an involuntary
petition in bankruptcy filed against it within 45 days of the filing
thereof;
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(f) a writ of execution or attachment or any similar process shall
be issued or levied against all or any part of or interest in any of the
properties or assets of the Borrower or any judgment involving monetary
damages shall be entered against the Borrower which shall become a lien on
the Borrower's properties or assets or any portion thereof or interest
therein and such execution, attachment or similar process is not released,
bonded, satisfied, vacated or stayed within thirty (30) days after its
entry or levy;
(g) seizure or foreclosure of any of the properties or assets of the
Borrower pursuant to process of law or by respect of legal self-help,
unless said seizure or foreclosure is stayed or bonded within thirty (30)
days after the occurrence of same;
(h) failure to observe any of the terms or conditions of the
commitment letter of the Authority dated June 25, 2001 as amended which is
incorporated herein.
Section 16. REMEDIES OF THE AUTHORITY.
(a) Whenever any Event of Default referred to in Section 15 hereof
shall have occurred and be continuing, the Authority may take one or more
of the following remedial steps:
(i) declare the entire principal amount of the Note to be due and
payable forthwith, whereupon the Note shall become forthwith,
due and payable, both as to principal and interest, without
presentment, demand, protest or other notice of any kind, all
of which are hereby expressly waived, anything contained herein
or in the Note to the contrary notwithstanding;
(ii) take any action at law or in equity to collect the payments
then due and thereafter to become due under the Note or to
enforce performance and observance of any obligation, agreement
or covenant of the Borrower under this Loan Agreement or the
Mortgage.
(b) If the Authority shall have proceeded to enforce its rights
under this Loan Agreement and such proceedings shall have been discontinued
or abandoned for any reason or shall have been determined adversely to the
Authority, then the Borrower and the Authority shall be restored
respectively to their several positions and rights hereunder, and all
rights, remedies and powers of the Borrower and the Authority shall
continue as though no such proceedings had taken place.
(c) Without limiting the generality of the foregoing, upon the
happening of an Event of Default by the Borrower hereunder, all of
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the Borrower's right, title and interest in the Project Site hereunder or
in equity and the Borrower's rights to possession thereof may be terminated
by an action for foreclosure or repossession in accordance with the
statutes of the State of New Jersey.
(d) Upon the institution of any such action by the Authority, the
Authority shall be entitled to the appointment of a receiver for the
Project Site.
(e) No remedy herein conferred or reserved to the Department or the
Authority is intended to be exclusive of any other available remedy or
remedies, but each and every such remedy shall be cumulative and shall be
in addition to every other remedy given under this Loan Agreement or now or
hereafter existing at law or in equity or by statute. No delay or omission
to exercise any right or power accruing upon any default shall impair any
such right or power or shall be construed to be a waiver thereof, but any
such right and power may be exercised from time to time and as often as may
be deemed expedient. In order to entitle the Authority or the Department to
exercise any remedy reserved to it in this Section, it shall not be
necessary to give notice other than such notice as may be required in this
Section.
(f) In addition to the above remedies, if the Borrower commits a
breach, or threatens to commit a breach of this Loan Agreement, the
Authority shall have the right and remedy, without posting bond or other
security, to have the provisions of this Loan Agreement specifically
enforced by any court having equity jurisdiction, it being acknowledged and
agreed that any such breach or threatened breach will cause irreparable
injury to the Authority and that money damages will not provide an adequate
remedy therefor.
(g) In the event the Borrower should default under any of the
provisions of this Loan Agreement and the Authority or the Department shall
require and employ attorneys or incur other expenses for the collection of
payments due or to become due for the enforcement or performance or
observance of any obligation or agreement on the part of the Borrower
herein contained, the Borrower shall on demand therefor pay to the
Authority, the reasonable fees of such attorneys and other expenses so
incurred by the Authority or the Department.
(h) The Authority shall not be required to do any act whatsoever or
exercise any diligence whatsoever to mitigate the damages to the Borrower
if an Event of Default shall occur hereunder.
Section 17. FURTHER ASSURANCES AND CORRECTIVE INSTRUMENTS. The
Borrower shall execute, acknowledge and deliver such supplements and
further instruments and perform such acts as the Authority may
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reasonably require for carrying out the intention of or facilitating the
performance of this Loan Agreement or the Note.
Section 18. RELEASE AND INDEMNIFICATION. The Borrower covenants and
agrees that neither the Authority or the Department, its members, agents,
servants, officers or employees shall be liable for: (1) any loss, damage
or injury to, or death of, any person occurring at or about or resulting
from any defect in the Project Site; (2) any damage or injury to the
persons or property of the Borrower, or its officers, agents, servants or
employees, or any other person who may be about the Project Site, caused by
any act of negligence of any person (other than the Authority, the
Department or its members, officers, agents, servants or employees); or (3)
any costs, expenses or damages incurred as a result of any lawsuit
commenced because of action taken in good faith by the Authority or the
Department in connection with the Project Site. The Borrower shall
indemnify, protect, defend and hold the Authority, the State of New Jersey
their respective members, agents, servants, officers and employees (each an
"Indemnified Party"), harmless from and against any and all such losses,
damages, injuries, costs or expenses and (except for claims, demands,
suits, actions or other proceedings brought against an Indemnified Party
resulting from willful or wanton misconduct or such Indemnified Party) from
and against any and all claims, demands, suits, actions or other
proceedings whatsoever, brought by any person or entity whatsoever, (except
the Borrower) and arising or purportedly arising from this Loan Agreement,
the Note or any transaction contemplated in any such documents, or from the
construction, ownership and operation of the Project Site.
Section 19. NOTICES. Any notices required to be sent under this
Loan Agreement shall be sent to:
(1) The Authority at: PO Box 990, Trenton, New Jersey 08625-0990,
Attn: Managing Director-Finance
(2) The Borrower at: Lincoln Avenue and Wheat Road, Buena,
New Jersey 08310, Attn: President
Section 20. POWER OF ATTORNEY,
(a) Borrower hereby makes, constitutes and appoints the Authority as
its irrevocable true and lawful attorney(s)-in-fact and each of its present
and future officers with full power of substitution in the premises, in
Borrower's name, place and stead for the purpose of perfecting, further
perfecting, acknowledging, continuing, filing, recording, endorsing and/or
making technical corrections in, any security interest, lien, encumbrance
or mortgage
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required to be granted or conveyed by Borrower to the Authority under the
terms of the Loan, including, without limitation, the filing of financing
and continuation statements. In addition, Borrower shall cooperate fully
with the Authority with respect to the filing or recordation of such
documents in the appropriate filing or recordation offices and it shall
bear, on demand, all costs of such filing or recordation.
(b) The attorney(s)-in-fact is/are hereby authorized to file or
record this Loan Agreement in the appropriate governmental filing or
recording office if such filing or recording of a power of attorney is
required by law in order to effectuate or validate same.
(c) Notwithstanding the foregoing, Borrower shall execute or endorse
any documents that are necessary in the sole judgment of the Authority to
perfect, secure, continue or correct any security interest, mortgage, lien
or encumbrance that Borrower is required under the terms of the Loan to
grant to the Authority as security for same.
Section 21. WAIVER OF RIGHT TO TRIAL BY JURY. Borrower waives any
right to trial by jury on any claim, demand, action or cause of action
arising under this Loan Agreement or the transactions related hereto, in
each case whether sounding in contract or tort or otherwise. Borrower
agrees and consents that any such claim, demand, action or cause of action
shall be decided by court trial without a jury, and that any party to this
Loan Agreement may file an original counterpart or a copy of this section
with any court as written evidence of the consent of Borrower to the waiver
of its right to trial by jury. Borrower acknowledges that it has had the
opportunity to consult with counsel regarding this section, that it fully
understands its terms, content and effect, and that it voluntarily and
knowingly agrees to the terms of this section.
Section 22. THE AUTHORITY'S REMEDIES AS AN INSTITUTION OF STATE
GOVERNMENT. The Authority, as an institution of State Government, is
entitled to exercise its remedies pursuant to N.J.S.A. 54A:9-8.1 and
N.J.A.C. 18:35-10.1, et seq. Notwithstanding anything to the contrary
herein contained, any proceeds received by the Authority pursuant to a set
off of a Borrower's and/or Guarantor's indebtedness to the Authority
through application of a Borrower's and/or Guarantor's tax refund or rebate
pursuant to these remedies, shall be allocated solely to the Authority.
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Section 23. MISCELLANEOUS.
(a) This Loan Agreement constitutes the entire agreement, and
supersedes all prior agreements and understandings, both written and oral
among the parties with respect to the subject matter hereof and may be
executed simultaneously in several counterparts, each of which shall be
deemed an original, an all of which together shall constitute one and the
same instrument.
(b) Modifications or waivers of any provisions of this Loan
Agreement or the Note must be in writing.
(c) In the event any provision of this Loan Agreement shall be held
invalid or unenforceable by any court of competent jurisdiction, such
holding shall not invalidate or render unenforceable any other provision
thereof.
(d) This Loan Agreement shall become effective upon its execution and
delivery by the parties hereto, shall remain in full force from the date
thereof, and subject to the provisions hereof, shall expire on such date as
the Note and the interest thereon and all other expenses or sums to which
the Authority is entitled, have been fully paid and retired.
(e) In the event that any provision of this Loan Agreement should be
breached by any party and thereafter waived by any party, such waiver shall
be limited to the particular breach so waived by any party and shall not be
deemed to waive any other breach.
(f) This Loan Agreement shall inure to the benefit of and be binding
upon the successors and assigns of the Authority and the Borrower.
(g) This Loan Agreement shall be construed and enforced under the
laws of the State of New Jersey.
(h) The rights and remedies of the Borrower under this Agreement
shall be subject to the New Jersey Contractual Liability Act, N.J.S.A.
59:13-1 et seq., the provisions of which are hereby incorporated herein by
reference in their entirety.
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IN WITNESS WHEREOF, the Authority and the Borrower have caused this
Loan Agreement to be executed in their respective names by their duly
authorized officers, as of the date first above written.
ATTEST: NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY
By: /s/ Teri Dunlop By: /s/ Richard H. Gaskill
------------------------- -------------------------------------
Teri Dunlop Richard H. Gaskill
Director-Lending Services Director-Special Loan Management
ATTEST: IGI, INC.
By: /s/ Domenic N. Golato By: /s/ John Ambrose
------------------------- -------------------------------------
Domenic N. Golato John Ambrose
Secretary President and Chief Executive Officer
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EXHIBIT "A"
IGI, INC.
PROMISSORY NOTE
$245,556 Trenton,
New Jersey
IGI, INC. (the "Borrower") a corporation organized and existing under
the laws of the State of Delaware acknowledges itself indebted and for
value received hereby promises to pay to the order of the NEW JERSEY
ECONOMIC DEVELOPMENT AUTHORITY (the "Authority") and its successors and
assigns, the principal sum of Two Hundred Forty-Five Thousand Five Hundred
Fifty-Six Dollars ($245,556), together with interest on the unpaid
principal balance thereof from the date hereof until the Borrower's
obligations with respect to the payment of such sum shall be discharged at
a fixed rate of interest of five percent (5%) per annum. Interest charges
shall be computed hereunder on the basis of a 360 day year, counting the
actual number of days elapsed.
This Note is issued to evidence the obligation of the Borrower under
and pursuant to, and shall be governed by and construed in accordance with
the terms and conditions of the Loan Agreement (the "Agreement") between
the Authority and the Borrower dated as of January 10, 2002 for the
repayment of the loan made by the Authority to the Borrower thereunder and
payment of interest thereon. Terms referred to herein have the same meaning
as defined in the Agreement. This Note is secured by a mortgage bearing
even date herewith, executed by the Borrower as Mortgagor and delivered to
the Authority as Mortgagee on real property located in Buena, New Jersey.
This Note is payable in one hundred twenty (120) equal monthly
installments of principal and interest in the sum of $2,612.95 commencing
on February 1, 2002 and on the first day of each succeeding month and
terminating if not sooner paid, as herein provided on January 1, 2012. Such
installments shall be applied first to payment of interest then due on the
unpaid principal amount and the remaining balance of each such installment
to be applied to the payment and reduction of the unpaid principal amount
of this Note. The amount payable as the final installment may be such
greater or lesser amount as shall be equal to the actual principal amount
of this Note remaining unpaid together with interest thereon then due and
unpaid. It is specifically understood and agreed that the Borrower shall
make payments on this Note based on amounts actually disbursed pursuant to
the Agreement.
Payments hereon are to be made in lawful money of the United States
of America to the New Jersey Economic Development Authority (P13379), P.O.
Box 18641, Newark, New Jersey 07191-8641, or such
15
other place as the Authority may designate, on each due date provided
above, in an amount which will equal the amount payable as interest and
principal on this Note.
The Borrower agrees to make the payments on this Note on the dates
and in the amounts specified herein and in the Agreement and in addition
agrees to make such other payments as are required pursuant to the
Agreement. A late charge of five percent (5%) of the monthly payment shall
be due and payable on any monthly payment past due seven (7) days or more.
However, in the event that this late charge is found unenforceable by a
court of law, the Borrower shall pay actual damages to the Authority which
shall include but not be limited to the loss of use of the delinquent
payment(s) and administrative costs in monitoring the default by the
Borrower. Administrative costs include but are not limited to attempts to
contact the Borrower via written and letter correspondence, generating and
reviewing the delinquency reports, evaluating the delinquent account,
evaluating the credit file, entering relevant information into the
Authority's file and/or computer, relaying information to management and
different departments, notifying and reporting to management and different
department. In the event of default in the Agreement, the principal of and
interest on this Note may be declared immediately due and payable as
provided in the Agreement. This Note may be canceled, amended or
supplemented as provided in the Agreement.
The Borrower may prepay this Note in whole at any time or in part on
any payment date without penalty. Partial prepayments shall be applied to
the last maturing payments due on this Note, shall be in one or more
increments of the monthly amount due, shall not extend or postpone the due
date of any subsequent monthly installment or change the amounts of such
installments. In any such case, the final payment on this Note shall be a
sum sufficient, together with other funds deposited with the Authority and
available for such purpose, to redeem all of this Note then outstanding at
the principal amount thereof plus accrued interest to the date of payment
and to pay all reasonable and necessary fees and expenses of the Authority
accrued and to accrue through final payment for this Note. At the
acceleration, termination or expiration of the term of this Note and
following full payment of this Note and all other fees and charges in
accordance with the provisions of the Agreement, the Authority shall
deliver to the Borrower any documents and take such actions as may be
necessary to effectuate the cancellation of this Note and evidence the
termination of the Agreement.
Notwithstanding the above, the actual principal amount of this Note
remaining unpaid together with interest thereon shall be immediately due
and payable upon the transfer of ownership of the Project Site.
16
Borrower waives any right to trial by jury on any claim, demand,
action or cause of action arising under this Note or the transactions
related hereto, in each case whether sounding in contract or tort or
otherwise. Borrower agrees and consents that any such claim, demand, action
or cause of action shall be decided by court trial without a jury, and that
any party to this Note may file an original counterpart or a copy of this
section with any court as written evidence of the consent of Borrower to
the waiver of its right to trial by jury. Borrower acknowledges that it has
had the opportunity to consult with counsel regarding this section, that it
fully understands its terms, content and effect, and that it voluntarily
and knowingly agrees to the terms of this section.
IN WITNESS WHEREOF, IGI, INC. has caused this Note to be executed in
its name and on its behalf by its authorized officers by their manual
signatures as of this 10th day of January, 2002.
ATTEST: IGI, INC.
By: _________________________ By: _____________________________________
Domenic N. Golato John Ambrose
Secretary President and Chief Executive Officer
17
EXHIBIT "B"
DIRECT LOAN REQUISITION NO.: 1
===========================================================================
INSTRUCTIONS: This form must be used to request loan disbursements.
1. Requisitions are limited to one per month in the aggregate amount of
not less than $1,000 unless specifically stated otherwise in the commitment
letter.
2. When possible, the vendors should be paid directly via a two-party
check payable to vendor/borrower. Direct reimbursement to the borrower
requires a copy of the invoice and the related canceled check.
===========================================================================
The undersigned, on behalf of IGI Inc. hereby requisitions the following
checks from the New Jersey Economic Development Authority:
(Controller/MIS Use Only)
Payee Amount Date Check#
----- ------ ---- ------
1. IGI Inc. & Riggins Inc. $178,276.00
-------------------------------------------------------------------
2.
-------------------------------------------------------------------
3.
-------------------------------------------------------------------
(Use attachment if needed)
===========================================================================
CERTIFICATION
The undersigned, a duly authorized representative of Borrower, hereby
certifies to the Authority on his/her own behalf and on behalf of Borrower,
that:
1. This requisition and or all requisitions previously disbursed to or on
behalf of Borrower under the Loan have been expended to pay for the costs
of the Project and not for any other use or purpose;
2. The work and expenses covered by this requisition have been or will be
performed and incurred towards completion of the Project in accordance with
the loan documents; and
3. To the best of the undersigned's knowledge, information and belief, the
remaining, undisbursed portion of the Loan is sufficient to complete the
Project.
Capitalized terms used in this Certification shall have the same meaning as
ascribed to them in the loan documents which relate to the Loan unless
expressly indicated otherwise.
BORROWER:
_____________________________ BY:
(Date) Name: See Attached
------------------------
(signature)
PRINT:________________________
(name and title)
============================================================================
DO NOT WRITE BELOW THIS LINE-FOR USE BY
NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY ONLY
Name of Borrower: IGI, Inc. Project (P) Number: P103379
----------- ----------------------
Fund: HAZ Total Amount of Loan: $245,556
----------------------- --------------------
Term: 10 yrs. Total Amount of Previous Checks: $-0-
----------------------- ---------
Interest Rate: 5% Total Amount of Requested Checks: $178,276
-------------- --------
Closing Date: 1-7-02 Total Amount to be Escrowed: $67,280.00
--------------- -------------
Deliver to Margaret Maurio Date & Time Check Needed: 1/4/02
Deliver to Teri Dunlop (first loan disbursement)
Deliver to Michele Bailey/Commercial Lending
Special Handling:
Reviewed by: /s/ William Carr Approved by: /s/ Lisa Coane
---------------- --------------------------
William Carr, Lisa Coane,
Finance Officer Director-Commercial Credit
Date: January 2, 2002
----------------------
18
EXHIBIT "C"
[EDA LOGO]
NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY
June 26, 2001
VIA FEDERAL EXPRESS
- -------------------
Domenic Golato, Senior Vice President
IGI, Inc.
Lincoln Avenue & Wheat Road
Buena, NJ 08310
RE: IGI, Inc.
P13379
-------------------------
Dear Mr. Golato:
I am pleased to inform you that at a meeting on June 12, 2001, the members
of the Authority approved the application of IGI, Inc. for a $245,556
Hazardous Discharge Site Remediation Fund (the "Fund") loan from the New
Jersey Department of Environmental Protection (the "Department") for
remedial action (the "Project") as stated in your request for financial
assistance dated May 18, 2001. In addition, on June 12, 2001 the members of
the Authority approved a grant in the amount of $81,852 for the Project.
The Authority, unless stated otherwise in this commitment letter, has
approved the loan upon the terms and conditions set forth in this
commitment letter and the General Terms and Conditions of Lending attached
and incorporated herein. No act or omission by or on behalf of the
Authority shall be deemed as a waiver to any of the terms and conditions
contained in this letter. Such a waiver may be made only by an instrument
in writing duly executed by an authorized representative of the Authority.
NAME OF BORROWER: IGI, Inc.
PROJECT SITE: 701 Harding Highway
Buena, New Jersey
LOAN: $245,556 from the Fund for a term of 10
years at a rate of interest of the
Federal Discount Rate at the date of
closing with a floor of 5%.
MAILING ADDRESS | PO BOX 990 | TRENTON, NJ 08625-0990
36 WEST STATE STREET | TRENTON, NJ 08625 | 609.292.1800 |
e-mail: njeda@njeda.com | www.njeda.com
19
AMORTIZATION: Principal payments in an amount to Fully
amortize $245,556 over 10 years plus
interest payable monthly for one hundred
twenty (120) months OR payment in full
upon sale of the Project Site.
PREPAYMENT PENALTY: None
SECURITY: A third mortgage on real property and
improvements located at 701 Harding
Highway, Buena, New Jersey.
FINANCIAL STATEMENTS: Signed copies of annual 10K federal
income tax returns submitted to the
Authority within 15 days of filing for:
IGI, Inc.
DISBURSEMENTS: The Loan proceeds will be disbursed in
accordance with the following
requirements: (1) receipt of statement
or invoice together with a requisition
signed by the Borrower stating (a) the
name and address of the person or firm to
be paid; and (b) the amount to be paid;
or if the Borrower has already paid the
invoice, proof of payment; (2) approval
of the Department of all invoices
submitted; and (3) compliance with the
terms of this commitment letter. No
disbursement will be made until the
Department notifies the Authority that
the invoice has been approved.
GRANT AMOUNT: $81,852
CONDITIONS:
- -----------
1. The Borrower shall complete the Project substantially as set forth in
its request for financial assistance.
2. This financing shall be subject to Borrower's compliance with the
statutory and regulating requirements under the Industrial Site
Recovery Act and with all applicable federal statutory or regulating
requirements.
20
3. Within 90 days of the date of this commitment letter, the Borrower
shall submit to the Authority an executed contract for the
remediation activities for which the Loan is being made. Failure to
submit an executed contract within the time provided, without good
cause, shall constitute grounds for the alteration of the Borrower's
priority ranking for the Loan.
The interests of the Borrower and the Authority are or may be different and
may conflict. The Authority's attorney represents only the Authority and
does not represent the Borrower in the Loan transaction. The Borrower,
therefore, is advised to employ an attorney licensed to practice in the
State of New Jersey, of the Borrower's own choice, to represent the
Borrower's interest in the Loan transaction.
The credit of the Borrower and all other features of the transaction shall
be as represented to the Authority without material adverse change. The
Borrower shall not be involved in any bankruptcy, reorganization or
insolvency proceeding.
The Authority will require evidence satisfactory to it and its counsel that
assets pledged to it as security for this financing are free and clear of
any and all security interest, except as set forth herein. The Authority
reserves the right to pre-file financing statements prior to closing.
Counsel to the Authority must be satisfied with respect to the legality,
validity, binding effect, and enforceability of all instruments,
agreements, and documents used to effect and consummate the transactions
contemplated herein. All documentation shall be in form and substance
satisfactory to the Authority.
By your acceptance of this commitment letter, you acknowledge this letter
is issued at a time when the Authority has not undertaken a full business,
credit, and legal analysis of the Borrower and/or the transaction(s)
contemplated by this commitment. As a result of further investigation and
analysis by the Authority and its counsel, information of which we are not
presently aware may be revealed and/or certain other impediments to closing
may come to our attention. Our mutual efforts will be directed toward the
closing of this financing. The Authority may require the financing to be
restructured or otherwise modified. As lender, the Authority is the sole
judge of what is an impediment and whether the impediment is so serious as
to preclude closing.
Each unsatisfied covenant, term and condition of this commitment which is
not expressly waived in writing by the Authority, shall survive any closing
hereunder. In case of any conflict between any unwaived and unsatisfied
covenant, term or condition of this commitment and the terms of the
Lender's commitment letter or the provisions of the loan documents
delivered at or pursuant to any closing regarding this financing, the
unwaived and/or unsatisfied covenant, term or condition of this commitment
shall control.
This commitment is subject to acceptance by the Borrower of the terms and
conditions contained herein and in the General Terms and Conditions of
Lending. This commitment letter must be signed and returned to the
undersigned together with a check in the amount of $1,227.78 made payable
to the NJEDA for the non-refundable commitment letter fee. In addition,
$1,227.78 is payable to the NJEDA at closing for the loan closing costs.
21
The Authority, at its option, may announce and publicize the source of
financing contemplated hereunder, by means and media selected by the
Authority.
This commitment shall terminate and the Authority shall have no further
obligation or liability hereunder if this letter is not signed and returned
to the undersigned with the applicable fees on or before July 31, 2001
("Acceptance Date"). An extension fee of $750 is required to extend the
Acceptance Date an additional 15 days.
In the event this financing is not closed on or before November 30, 2001
("Closing Date"), the Authority's obligation to provide financing hereunder
shall terminate and the Borrower will be required to submit a new
application.
Please contact William Carr at (609) 292-0188 if you have any questions
regarding this matter.
We are pleased to be of service to your financing needs.
Sincerely,
/s/ Adam Mukerji
Adam Mukerji
Director-Commercial Lending
td/mg
ACCEPTED AND AGREED THIS 9TH DAY
OF JULY, 2001 BY:
BORROWER:
IGI, INC.
By /s/ Domenic N. Golato
---------------------
Domenic N. Golato
Senior Vice President
22
HAZARDOUS DISCHARGE SITE REMEDIATION FUND
GENERAL TERMS AND CONDITIONS OF LENDING
---------------------------------------
1. Any liens on real property required by this commitment letter
shall be liens on the fee simple absolute title to the land and all
improvements, free of any prior mechanic's or materialmen's liens or
special assessments. Any title exceptions are subject to approval by the
Authority.
2. Title insurance, when required, shall be evidenced by a paid
policy with an insurance company or companies acceptable to the Authority
and qualified to do business in New Jersey.
3. Appraisals, when required, shall be made by an independent
appraiser acceptable to the Authority. The appraisal fee shall be payable
by the Borrower.
4. Fire and hazard insurance, including theft, vandalism and
malicious mischief, shall equal 100% of the insurable value of all
collateral securing the loan and shall be secured from such companies
approved by the Authority. Insurance covering real property shall include a
standard mortgagee endorsement in favor of the NJEDA. Insurance for
contents shall include the NJEDA as loss payee in a standard lender's loss
payable clause. General liability insurance shall be in amounts of $500,000
per individual, $1,000,000 per occurrence and shall name the NJEDA as
additional insured. All insurance policies required shall be secured from
companies qualified to do business in New Jersey. Flood insurance or proof
that all real property and/or business assets are not in a flood hazard
area is required.
5. Financial statements, when required, shall be prepared by an
independent certified public accountant acceptable to the Authority.
Unaudited financial statements shall be duly certified by the chief
financial officer of the company. Financial statements shall be submitted
to the Authority as provided in the commitment letter.
6. During the term of the Loan the Borrower and any Guarantor:
a. Shall make no material changes in their present management or
operating control without the consent of the Authority.
b. Shall not merge or consolidate with or acquire any other
business, corporation or partnership without the consent of the
Authority.
c. Shall not engage in any additional financing or grant any liens
or security interests regarding the collateral securing the loan
except as provided herein.
d. Shall not sell, assign, lease, sublease, transfer or encumber
its interest in any collateral securing the loan without the consent
of the Authority.
e. Shall permit representatives of the Authority and the
Department to examine all books and records of the Borrower regarding
the Project Site and to inspect the Project Site.
f. If Borrower or Guarantor is a corporation, the Borrower and/or
the Guarantor shall agree that the Authority shall have the right to
have a representative present at all special and regular meetings of
their boards of directors. The Borrower and/or the Guarantor shall
notify the Executive Director of the Authority of such meetings in
advance. In addition, each shall obtain the necessary authority of
their respective boards of directors and /or shareholders to enter
into the agreements evidenced or specified herein, and will each
obtain such further authorization of their respective boards of
directors and/or shareholders as may be necessary or appropriate to
the financing arrangements set forth herein.
g. Shall not transfer excess cash flow; declare cash or stock
dividends (except Sub-Chapter S Corporations); issue any additional
stock; or purchase its own stock for value without the consent of the
Authority.
h. Shall pay all taxes, assessments and governmental charges
lawfully assessed or levied against its properties and assets. The
Borrower of Guarantor shall also pay all utility, water, sewer or
other charges incurred in the occupancy, use or operation regarding
the Project Site.
7. The Borrower shall submit, when required, such searches, title
reports, and certificates evidencing Borrower's title to its real and
personal property serving as collateral for the loan in a form
satisfactory to counsel for the Authority.
8. The Borrower shall duly execute and deliver to such
instruments, documents, certificates, opinions, assurances, and do
such other acts and things as the Authority may reasonably require to
effect the purpose of the transaction described herein. All
proceedings, agreements, instruments, documents, and other matters
relating to the application for the loan and all other transactions
contemplated herein shall be satisfactory to counsel for the
Authority.
9. The Authority may require a current legal opinion by Borrower's
legal counsel to the effect that all documents are valid and binding
on the Borrower or Guarantor, that the Borrower of Guarantor have
valid title to their assets and that to the best of the attorney's
knowledge there is no litigation pending which would adversely affect
the Borrower's or Guarantor's financial condition.
10. Any consent of the Authority required to be given hereunder
must be expressly stated in writing by an authorized officer of the
Authority.
11. The Borrower shall agree to indemnify and save harmless, the
Authority and the Department, their officers, members, employees,
agents and servants from any losses, damages, claims or liability
arising from the making of the loan or the operation, ownership or
remediation of the Project Site.
12. The Borrower shall be in compliance and complete the Project in
compliance with all applicable Federal, state and local laws, rules
and regulations and as set forth in its application to the
Department.
23
ACKNOWLEDGMENT
STATE OF NEW JERSEY :
:
COUNTY OF MERCER :
BE IT REMEMBERED, that on this 9th day of January, 2002, before me,
the subscriber, a Notary Public of the State of New Jersey, personally
appeared RICHARD H. GASKILL, who, being by me duly sworn on his oath,
deposes and makes proof to my satisfaction, that he is the DIRECTOR -
SPECIAL LOAN MANAGEMENT of the NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY,
the Authority named in the within Instrument; that the execution, as well
as the making of this Instrument, has been duly authorized by a proper
resolution of the Members of said Authority; and said Instrument was signed
and delivered by said Director - Special Loan Mamagement as and for the
voluntary act and deed of said Authority.
/s/ Michelle L. Clark
-------------------------
Michelle L. Clark
Notary Public
of New Jersey
My Commission Expires May 2, 2006
24
ACKNOWLEDGMENT
STATE OF NEW JERSEY :
:
COUNTY OF MERCER :
BE IT REMEMBERED, that on this 10th day of January, 2002, before me,
personally appeared, JOHN AMBROSE, to me known, who, being by me duly
sworn, did depose and say that he is the President and Chief Executive
Officer of IGI, Inc., the corporation named in the within Instrument; that
the execution, as well as the making of this Instrument, has been duly
authorized by a proper resolution of the Board of Directors of said
corporation; and said Instrument was signed and delivered by said President
and Chief Executive Officer as and for the voluntary act and deed of said
corporation.
/s/ Diane Mulligan
-------------------------
An Attorney At Law
of the State of New Jersey
25