TERM LOAN PROMISSORY NOTE
Baltimore, Maryland $1,500,000
November 21, 1996
FOR VALUE RECEIVED, the undersigned, CHESAPEAKE BIOLOGICAL LABORATORIES,
INC., a Maryland corporation (the "Borrower"), promises to pay to the order of
THE MAYOR AND CITY COUNCIL OF BALTIMORE, a body politic and corporate and a
political subdivision of the State of Maryland, by and through the DEPARTMENT OF
HOUSING AND COMMUNITY DEVELOPMENT, c/o CITY OF BALTIMORE DEVELOPMENT
CORPORATION, its successors and assigns (the "Lender"), at 36 South Charles
Street, Sixteenth Floor, Baltimore, Maryland 21201 or at such other places as
the holder of this Promissory Note may from time to time designate, the
principal sum of One Million Five Hundred Thousand Dollars ($1,500,000),
together with interest thereon at the rate or rates hereafter specified until
paid in full and any and all other sums which may be owing to the holder of this
Promissory Note by the Borrower pursuant to this Promissory Note. The following
terms shall apply to this Promissory Note.
1. Calculation of Interest. Interest shall be calculated on the basis of a
three hundred sixty (360) days per year factor applied to the actual days on
which there exists an unpaid balance hereunder.
2. Interest Rate. Interest shall accrue on the unpaid principal balance of
this Promissory Note until paid in full at a fixed annual rate of interest of
six and one-half percent (6.5%).
3. Repayment. (a) Commencing on December 21, 1996, and continuing on the
twenty-first (21st) calendar day of each successive calendar month thereafter up
to and including November 21, 1998, the Borrower shall pay to the holder monthly
installments of interest, unless this Promissory Note has been paid earlier, as
hereinafter provided.
(b) Commencing on December 21, 1998 and continuing on the twenty-first
(21st) calendar day of each successive calendar month thereafter, the Borrower
shall pay to the holder monthly installments of principal and interest in the
amount of Eleven Thousand Seven Hundred Ninety-eight Dollars and Forty-two Cents
($11,798.42) each, until November 21, 2016, which date is the final and absolute
maturity date of this Promissory Note, at which time all sums due hereunder,
including principal, interest, charges and fees, shall be paid in full.
4. Late Payment Charge. If any payment due hereunder, including any final
installment, is not received by the holder within fifteen (15) calendar days
after its due date, the Borrower shall pay a late payment charge equal to five
percent (5%) of the amount then due (including both principal and interest). The
late
payment charge shall be due whether or not the holder declares this Promissory
Note in default or accelerates and demands immediate payment of the sums due
hereunder. The existence of the right by the holder to receive a late payment
charge shall not constitute a grace period or provide any right in the Borrower
to make a payment other than on its due date.
5. Application of Payments. All payments made hereunder shall be applied
first to late payment charges or other sums owed to the holder, next to accrued
interest, and then to principal, or in such other order or proportion as the
holder, in the holder's sole discretion, may elect from time to time.
6. Prepayment. The Borrower may prepay this Promissory Note in whole or in
part at any time or from time to time without premium or additional interest.
All prepayments under this Promissory Note shall be applied to the outstanding
principal balance in the inverse order of scheduled maturities.
7. Rights Upon Default. Upon a default in the payment of any sum due
hereunder, or a default in the performance of any of the covenants, conditions
or terms of the Purchase Money Mortgage dated as of the date hereof by and
between the Borrower and the Lender (the "Agreement"), or any other agreement or
document executed by or on behalf of the Borrower for the benefit of the Lender
or any holder (collectively with the Loan Agreement, the "Loan Documents"), and
the expiration of any applicable cure period, in addition to all other rights or
remedies available to the holder under the Loan Documents or under applicable
law, the holder of this Promissory Note shall have the following rights:
7.1. Acceleration. The holder of this Promissory Note, in the holder's
sole discretion and without notice or demand, may declare the entire unpaid
principal balance plus accrued interest and all other sums due hereunder
immediately due and payable. Reference is made to the Loan Documents for further
and additional rights on the part of the holder to declare the entire unpaid
principal balance plus accrued interest and all other sums due hereunder
immediately due and payable.
7.2. Default Interest Rate. The holder of this Promissory Note, in the
holder's sole discretion and without notice or demand, may raise the rate of
interest accruing on the unpaid principal balance by two percent (2%), above
the rate of interest otherwise applicable, independent of whether the holder
elects to accelerate the unpaid principal balance as a result of such default,
unless prior to the imposition of the default rate of interest, the Borrower
cures such event to the satisfaction of the holder hereof. If the default rate
of interest is imposed by the holder, the default rate shall remain in effect,
even though after being imposed the event authorizing the imposition thereof has
been cured, until this Promissory Note is paid in full, unless the default is
cured to the holder's satisfaction and the holder in
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writing agrees to reinstate the regular interest rate. Any individual waiver of
the holder's right to impose the default rate of interest or to retain the
default rate of interest after imposition thereof shall not be considered a
waiver of this section or any future right of the holder to impose the default
rate of interest pursuant to this Section.
7.3. Confession of Judgment. THE BORROWER AUTHORIZES ANY ATTORNEY
ADMITTED TO PRACTICE BEFORE ANY COURT OF RECORD IN THE UNITED STATES, OR THE
CLERK OF SUCH COURT, TO APPEAR ON BEHALF OF THE BORROWER IN ANY COURT IN ONE OR
MORE PROCEEDINGS, OR BEFORE ANY CLERK THEREOF OR PROTHONOTARY OR OTHER COURT
OFFICIAL, AND TO CONFESS JUDGMENT AGAINST THE BORROWER IN FAVOR OF THE HOLDER OF
THIS PROMISSORY NOTE IN THE FULL AMOUNT DUE ON THIS PROMISSORY NOTE (INCLUDING
PRINCIPAL, ACCRUED INTEREST AND ANY AND ALL CHARGES, FEES AND COSTS) PLUS
ATTORNEYS' FEES EQUAL TO FIFTEEN PERCENT (15%) OF THE AMOUNT DUE, AND PROVIDED
THAT IN ANY EVENT THE AMOUNT COLLECTED OR REALIZED IN RESPECT OF SUCH ATTORNEYS
FEES SHALL NOT EXCEED THE ACTUAL ATTORNEYS FEES REASONABLY INCURRED IN THE
ENFORCEMENT OF THIS NOTE, PLUS COURT COSTS, ALL WITHOUT PRIOR NOTICE OR
OPPORTUNITY OF THE BORROWER FOR PRIOR HEARINGS. THE BORROWER AGREES AND CONSENTS
THAT VENUE AND JURISDICTION SHALL BE PROPER IN THE CIRCUIT COURT OF ANY COUNTY
OF THE STATE OF MARYLAND OR OF BALTIMORE CITY, MARYLAND, OR IN THE UNITED STATES
DISTRICT COURT FOR THE DISTRICT OF MARYLAND. THE BORROWER WAIVES THE BENEFIT OF
ANY AND EVERY STATUTE, ORDINANCE, OR RULE OF COURT WHICH MAY BE LAWFULLY WAIVED
CONFERRING UPON THE BORROWER ANY RIGHT OR PRIVILEGE OF EXEMPTION, HOMESTEAD
RIGHTS, STAY OF EXECUTION, OR SUPPLEMENTARY PROCEEDINGS, OR OTHER RELIEF FROM
THE ENFORCEMENT OR IMMEDIATE ENFORCEMENT OF A JUDGMENT OR RELATED PROCEEDINGS ON
A JUDGMENT. THE AUTHORITY AND POWER TO APPEAR FOR AND ENTER JUDGMENT AGAINST
THE BORROWER SHALL NOT BE EXHAUSTED BY ONE OR MORE EXERCISES THEREOF, OR BY ANY
IMPERFECT EXERCISE THEREOF, AND SHALL NOT BE EXTINGUISHED BY ANY JUDGMENT
ENTERED PURSUANT THERETO; SUCH AUTHORITY AND POWER MAY BE EXERCISED ON ONE OR
MORE OCCASIONS FROM TIME TO TIME, IN THE SAME OR DIFFERENT JURISDICTIONS, AS
OFTEN AS THE HOLDER SHALL DEEM NECESSARY, CONVENIENT, OR PROPER.
8. Interest Rate After Judgment. If judgment is entered against the Borrower
on this Promissory Note, the amount of the judgment entered (which may include
principal, interest, fees, and costs) shall bear interest at the higher of the
maximum interest rate imposed upon judgments by applicable law or the above
described default interest rate, to be determined on the date of the entry of
the judgment.
9. Expenses of Collection And Attorneys' Fees. Should this Promissory Note
be referred to an attorney for collection, whether or not judgment has been
confessed or suit has been filed, the Borrower shall pay all the holder's
reasonable costs, fees and expenses, including reasonable attorneys' fees,
resulting from such referral.
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10. Waiver of Defenses. In the event any one or more holders of this
Promissory Note transfer this Promissory Note for value, the Borrower agrees
that all subsequent holders of this Promissory Note who take for value and
without actual knowledge of a claim or defense of the Borrower against a prior
holder shall not be subject to any claims or defenses which the Borrower may
have against a prior holder, all of which are waived as to the subsequent
holder, and that all such subsequent holders shall have all rights of a holder
in due course with respect to the Borrower even though the subsequent holder may
not qualify, under applicable law, absent this section, as a holder in due
course. The Borrower shall retain all rights and claims which the Borrower may
have against prior holders despite any such transfers and the waiver of defenses
provided in this section as to subsequent holders.
11. Waiver of Protest. The Borrower, and all parties to this Promissory
Note, whether maker, endorser, or guarantor, waive presentment, notice of
dishonor and protest.
12. Extensions of Maturity. All parties to this Promissory Note, whether
maker, endorser, or guarantor, agree that the maturity of this Promissory Note,
or any payment due hereunder, may be extended at any time or from time to time
without releasing, discharging, or affecting the liability of such party.
13. Manner and Method of Payment. All payments called for in this Promissory
Note shall be made in lawful money of the United States of America. If made by
check, draft, or other payment instrument, such check, draft, or other payment
instrument shall represent immediately available funds. In the holder's
discretion, any payment made by a check, draft, or other payment instrument
shall not be considered to have been made until such time as the funds
represented thereby have been collected by the holder. Should any payment date
fall on a non-banking day, the Borrower shall make the payment on the next
succeeding banking day.
14. Notices. Any notice or demand required or permitted by or in connection
with this Promissory Note shall be given in the manner specified in the
Agreement for the giving of notices under the Agreement. Notwithstanding
anything to the contrary, all notices and demands for payment from the holder
actually received in writing by the Borrower shall be considered to be effective
upon the receipt thereof by the Borrower regardless of the procedure or method
utilized to accomplish delivery thereof to the Borrower.
15. Assignability. This Promissory Note may be assigned by the Lender or any
holder at any time or from time to time.
16. Joint and Several Liability. If more than one person or entity is
executing this Promissory Note as a Borrower, all liabilities under this
Promissory Note shall be joint and several with respect to each of such persons
or entities.
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17. Binding Nature. This Promissory Note shall inure to the benefit of and
be enforceable by the Lender and the Lender's successors and assigns and any
other person to whom the Lender or any holder may grant an interest in the
Borrower's obligations hereunder, and shall be binding and enforceable against
the Borrower and the Borrower's personal representatives, successors and
assigns.
18. Invalidity of Any Part. If any provision or part of any provision of
this Promissory Note shall for any reason be held invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Promissory Note and this
Promissory Note shall be construed as if such invalid, illegal or unenforceable
provisions or part thereof had never been contained herein, but only to the
extent of its invalidity, illegality, or unenforceability.
19. Choice of Law. The laws of the State of Maryland (excluding, however,
conflict of law principles) shall govern and be applied to determine all issues
relating to this Promissory Note and the rights and obligations of the parties
hereto, including the validity, construction, interpretation, and enforceability
of this Promissory Note and its various provisions and the consequences and
legal effect of all transactions and events which resulted in the issuance of
this Promissory Note or which occurred or were to occur as a direct or indirect
result of this Promissory Note having been executed.
20. Consent To Jurisdiction; Agreement As To Venue. The Borrower irrevocably
consents to the exclusive jurisdiction of the courts of the State of Maryland in
the City of Baltimore and of the United States District Court for the District
of Maryland, if a basis for federal jurisdiction exists. The Borrower agrees
that venue shall be proper in the circuit court for the City of Baltimore of the
State of Maryland selected by the Lender or in the United States District Court
for the District of Maryland if a basis for federal jurisdiction exists and
waives any right to object to the maintenance of a suit in any of the state or
federal courts of the State of Maryland on the basis of improper venue or of
inconvenience of forum.
21. Unconditional Obligations. The Borrower's obligations under this
Promissory Note shall be the absolute and unconditional duty and obligation of
the Borrower and shall be independent of any rights of set-off, recoupment or
counterclaim which the Borrower might otherwise have against the holder of this
Promissory Note, and the Borrower shall pay absolutely the payments of
principal, interest, fees and expenses required hereunder, free of any
deductions and without abatement, diminution or set-off.
22. Seal and Effective Date. This Promissory Note is an instrument executed
under seal and is to be considered effective
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and enforceable as of the date set forth on the first page hereof, independent
of the date of actual execution and delivery.
23. Tense; Gender; Defined Terms; Section Headings. As used herein, the
singular includes the plural and the plural includes the singular. A reference
to any gender also applies to any other gender. Defined terms are entirely
capitalized throughout. The section headings are for convenience only and are
not part of this Promissory Note.
24. Actions Against Lender. Any action brought by the Borrower against the
Lender which is based, directly or indirectly, on this Promissory Note or any
matter in or related to this Promissory Note, including but not limited to the
making of the loan evidenced hereby or the administration or collection thereof,
shall be brought only in the courts of the State of Maryland. The Borrower may
not file a counterclaim against the Lender in a suit brought by the Lender
against the Borrower in a state other than the State of Maryland unless under
the rules of procedure of the court in which the Lender brought the action the
counterclaim is mandatory, and not merely permissive, and will be considered
waived unless filed as a counterclaim in the action instituted by the Lender.
The Borrower agrees that any forum other than the State of Maryland is an
inconvenient forum and that a suit brought by the Borrower against the Lender in
a court of any state other than the State of Maryland should be forthwith
dismissed or transferred to a court located in the State of Maryland by that
Court.
25. Waiver of Jury Trial. The Borrower (by execution of this Promissory
Note) and the Lender (by acceptance of this Promissory Note) agree that any
suit, action, or proceeding, whether claim or counterclaim, brought or
instituted by or against the Borrower or the Lender, or any successor or assign
of the Borrower or the Lender, on or with respect to this Promissory Note or any
of the other Loan Documents, or which in any way relates, directly or
indirectly, to the obligations of the Borrower to the Lender under this
Promissory Note or any of the other Loan Documents, or the dealings of the
parties with respect thereto, shall be tried only by a court and not by a jury.
THE BORROWER AND THE LENDER HEREBY EXPRESSLY WAIVE ANY RIGHT TO A TRIAL BY JURY
IN ANY SUCH SUIT, ACTION, OR PROCEEDING. The Borrower and the Lender acknowledge
and agree that this provision is a specific and material aspect of the agreement
between the parties and that the Lender would not enter into the transaction
with the Borrower if this provision were not part of their agreement.
26. Subordination Agreement. Notwithstanding anything contained herein to
the contrary, neither the principal nor the interest on the indebtedness crated
or evidenced by this instrument or record shall become due or be paid or payable
except to the extent permitted in the Subordination Agreement dated as of
November 1, 1996, among the Lender, the Borrower and First Union National Bank
of North Carolina, which Subordination Agreement is
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incorporated herein by specific reference thereto to the same extent as if fully
set forth herein.
IN WITNESS WHEREOF, the Borrower has duly executed this Promissory Note
under seal as of the date first above written.
ATTEST:/WITNESS BORROWER:
CHESAPEAKE BIOLOGICAL LABORATORIES, INC.
/s/ J.T. Janssen By:/s/ John C. Weiss, III (SEAL)
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Treasurer Secretary John C. Weiss, III, President
APPROVED AS TO FORM AND LEGAL
SUFFICIENCY THIS 19 DAY OF
SEPTEMBER, 1996:
/s/ Jay M. Caplan
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Jay M. Caplan, Special Solicitor
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