Exhibit 10(k)
REVOLVING LOAN - GRID NOTE
$200,000.00 Westerville, Ohio February 28, 1997
FOR VALUE RECEIVED, the undersigned promises to pay to the order of
NETMED, INC. (hereinafter called the "Lender," which term shall include any
holder hereof) at such place as the Lender may designate, the sum of
TwoHundred Thousand Dollars ($200,000.00) or so much thereof as shall have
been advanced by the Lender at any time and not hereafter repaid (hereinafter
referred to as "Principal Sum") together with interest as hereinafter
provided and payable at the times and in the manners hereinafter provided.
The proceeds of the loan evidenced hereby may be advanced, and repaid in
partial amounts during the term of this revolving note (this "Note") and
prior to maturity. Each such advance shall be made to the undersigned upon
receipt by the Lender of the undersigned's application therefor and
disbursement instructions, which shall be in such form as the Lender shall
from time to time prescribe. The Lender shall be entitled to rely on any
oral or telephonic communication requesting an advance and/or providing
disbursement instructions hereunder, which shall be received by it in good
faith from anyone reasonably believed by the Lender to be the undersigned, or
the undersigned's authorized agent. The undersigned agrees that all Advances
(as such term is defined in the Investment Agreement referenced below) made
by the Lender and payments by the undersigned will be evidenced by entries
made by the Lender on the grid or grids attached hereto, and the undersigned
further agrees that such entries shown on the grid or grids attached hereto
shall be rebuttably presumptive evidence of the amount of the Principal Sum,
any and all advances and payments thereof. Copies of such entries shall be
provided by Lender to the undersigned within a reasonable time after they are
made. Each request for an advance shall constitute a warranty and
representation by the undersigned that no event of default hereunder, under
the Investment Agreement, or under any related loan documents has occurred
and is continuing and that no event or circumstance which would constitute
such an event of default, but for the requirement that notice be given or
time elapse or both, has occurred and is continuing.
This Note is executed and the advances contemplated hereunder are to be
made pursuant to an Investment Agreement by and between the undersigned and
the Lender of even date, and all amendments, modifications, and supplements
thereto from time to time (the "Investment Agreement"), and all the
covenants, representations, agreements, terms, and conditions contained
therein, including but not limited to additional conditions of default, are
incorporated herein as if fully rewritten.
INTEREST
Interest will accrue on the unpaid balance of the Principal Sum until
paid at a fixed rate of interest equal to eight and one-half percent (8.50%)
per annum.
All interest shall be calculated on the basis of a 365 day year for the
actual number of days the Principal Sum or any part thereof remains unpaid.
MANNER OF PAYMENT
The Principal Sum shall be payable on December 31, 1998, and accrued
interest shall be due and payable at maturity, whether by demand,
acceleration or otherwise.
DEFAULT
Upon the occurrence of any of the following events:
(a) the undersigned fails to make any payment of principal on or
before the date such payment is due;
(b) the undersigned fails to make any payment of interest on or
before five days after the date such payment is due; or
(c) an "Event of Default" under the Investment Agreement shall have
occurred and be continuing;
then the Lender may, at his option, without notice or demand, accelerate the
maturity of the obligations evidenced hereby, which obligations shall become
immediately due and payable. In the event the Lender shall institute any
action for the enforcement or collection of the obligations evidenced hereby,
the undersigned agree to pay all costs and expenses of such action, including
reasonable attorneys' fees, to the extent permitted by law.
GENERAL PROVISIONS
All of the parties hereto, including the undersigned, and any indorser,
surety, or guarantor, hereby jointly and severally waive presentment, notice
of dishonor, protest, notice of protest, and diligence in bringing suit
against any party hereto, waive the defenses of impairment of collateral for
the obligation evidenced hereby, impairment of a person against whom the
Lender has any right of recourse, and any defenses of any accommodation maker
and consent that without discharging any of them the time of payment and any
other provision of this promissory note may be extended or modified an
unlimited number of times before or after maturity without notice to the
undersigned. The undersigned agrees that it will pay the obligations
evidenced hereby, irrespective of any action or lack of action on Lender's
part in connection with the acquisition, perfection, possession, enforcement,
disposition, or modification of all the obligations evidenced hereby or any
and all security therefor, and no omission or delay on Lender's part in
exercising any right against, or taking any action to collect from or pursue
Lender's remedies against any party hereto will release, discharge, or modify
the duties of the undersigned to make payments hereunder. The undersigned
agrees that Lender may, without notice to or further consent from the
undersigned, release or modify any collateral, security, document or other
guaranties now held or hereafter acquired, or substitute other collateral,
security or other guaranties, and no such action will release, discharge or
modify the duties of the undersigned hereunder. The undersigned agrees that
Lender will not be required to pursue or
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exhaust any of its rights or remedies against the undersigned or any
guarantors of the obligations evidenced hereby with respect to the payment of
any said obligations, or to pursue, exhaust or preserve any of Lender's
rights or remedies with respect to any collateral, security or other
guaranties given to secure said obligations.
The obligations evidenced hereby may from time to time be evidenced by
another note or notes given in substitution, renewal or extension hereof.
Any security interest or mortgage which secures the obligations evidenced
hereby shall remain in full force and effect notwithstanding any such
substitution, renewal, or extension.
The captions used herein are for references only and shall not be deemed a
part of this Note. If any of the terms or provisions of this Note shall be
deemed unenforceable, the enforceability of the remaining terms and provisions
shall not be affected. This Note shall be governed by and construed in
accordance with the law of the State of Ohio.
WAIVER OF RIGHT TO TRIAL BY JURY
THE UNDERSIGNED HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF
ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (1) ARISING UNDER THIS NOTE OR
ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH, OR (2) IN ANY WAY CONNECTED WITH OR RELATED OR
INCIDENTAL TO THE DEALINGS OF THE UNDERSIGNED OR THE LENDER WITH RESPECT TO
THIS NOTE OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR
DELIVERED IN CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR
THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER
SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND THE UNDERSIGNED HEREBY AGREES
AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE
DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT THE UNDERSIGNED OR THE LENDER
MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS
WRITTEN EVIDENCE OF THE CONSENT OF THE UNDERSIGNED TO THE WAIVER OF THE RIGHT
OF THE UNDERSIGNED TO TRIAL BY JURY.
WARRANT OF ATTORNEY
The undersigned authorizes any attorney at law to appear in any Court of
Record in the State of Ohio or in any state or territory of the United States
after the above indebtedness becomes due, whether by acceleration or
otherwise, to waive the issuing and service of process, and to confess
judgment against the undersigned in favor of the Lender for the amount then
appearing due together with costs of suit, and thereupon to waive all errors
and all rights of appeal and stays of execution.
WARNING--BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE
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TAKEN AGAINST YOU WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN
BE USED TO COLLECT FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE
CREDITOR WHETHER FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO
COMPLY WITH THE AGREEMENT, OR ANY OTHER CAUSE.
CERAM OXYGEN TECHNOLOGIES, INC.
By: /s/ William N. Lawless
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William N. Lawless, President
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GRID
Date of Advance ("A")
Advance or or Principal
Payment Payment ("P") Amount Balance
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