EXHIBIT 10.23
GRID TERM NOTE
October 18, 2000
FOR VALUE RECEIVED, XXXXXX X. XXXXXX ("Borrower"), does hereby
unconditionally promise to pay to the order of SAFEGUARD SCIENTIFICS, INC., a
Pennsylvania corporation, and its successors and assigns ("Lender"), at Xxxxxx's
office located at 000 Xxxxx Xxxx Xxxxx, Xxxxx, Xxxxxxxxxxxx 19087, or at such
other place as Lender may from time to time designate in writing, in lawful
money of the United States, the aggregate unpaid principal amount of all
advances (each such advance being a "Loan") made hereunder by Xxxxxx or any of
its affiliates, as set forth on Schedule A attached hereto and incorporated
herein by reference, as the same may from time to time be modified or amended,
together with accrued and unpaid interest thereon, each due and payable on the
dates and in the manner set forth in this promissory note (this "Note").
Borrower hereby authorizes Lender to list on Schedule A all advances made by
Xxxxxx hereunder, which notations shall, in the absence of manifest error, be
conclusive; provided, however, that the failure to make a notation or the
inaccuracy of the notation shall not limit or otherwise affect the obligations
of Borrower under this Note.
1. Principal. The aggregate principal amount of all Loans shall not
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exceed $10,000,000.
2. Rate of Interest. Interest on the principal amount of all Loans
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outstanding form time to time under this Note shall accrue at an annual rate
equal to the prime rate set forth from time to time in The Wall Street Journal
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(the "Interest Rate"). Interest payable on all Loans made hereunder shall be
calculated for actual days elapsed on the basis of a 360-day year.
Notwithstanding anything in this Note, the Interest Rate charged hereon shall
not exceed the maximum rate allowable by applicable law. If any stated interest
rate herein exceeds the maximum allowable rate, then the interest rate shall be
reduced to the maximum allowable rate, and any excess payment of interest made
by Borrower at any time shall be applied to the unpaid balance of any
outstanding principal of this Note.
3. Payment of Interest and Principal; Mandatory Prepayment. Principal
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and interest on all Loans made under this Note shall be payable in full on March
15, 2001 (the "Maturity Date"). The Borrower shall make promptly a mandatory
prepayment on this Note in the amount of all net proceeds realized by Borrower
from the sale or refinancing of the property located at 000 Xxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxxxxxx in accordance with the terms of the Letter Agreement
referred to below.
4. Method and Application of Payments. All amounts payable hereunder
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shall be paid by Borrower in immediately available and freely transferable funds
at the place designated by Lender to Borrower for such payment. All payments
made on this Note (including, without limitation, prepayments) shall be applied
to fees and expenses (including attorneys' fees), accrued interest and principal
in any order Lender may choose, in its sole discretion.
5. Events of Default. Each of the following events shall constitute an
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event of default (an "Event of Default") hereunder:
a. If Borrower shall fail to pay when due any interest or
principal or any other sum payable to Lender hereunder and such failure shall
continue unremedied for two (2) days after the due date thereof.
b. If any representation or warranty made by Borrower to Lender
in any statement, certificate or other document, or any financial statement
provide to Lender, is false, erroneous or misleading in any material respect.
c. If Xxxxxxxx shall become insolvent or bankrupt; or if Xxxxxxxx
shall admit in writing his inability to pay his debts; or if Xxxxxxxx shall
suffer a receiver or trustee for substantially all of his property to be
appointed; or if Borrower makes an assignment for the benefit of creditors; or
if proceedings under any law related to bankruptcy or insolvency or the
reorganization or the release of debtors are instituted against Borrower and are
not dismissed or stayed within sixty (60) days; or if a receiver or trustee for
Borrower or substantially all of his property shall be appointed without
Xxxxxxxx's consent and such receiver or trustee shall not be discharged within
sixty (60) days ; or if proceedings relating to Borrower under any law related
to bankruptcy or insolvency or the reorganization or the release of debtors are
instituted or commenced by Borrower.
d. If Borrower shall default in the performance of the letter
agreement, dated as of October 4, 2000 and amended as of November 8, 2000 (the
"Letter Agreement") between Borrower and Lender or the Security Agreement
referred to in paragraph 7 below.
6. Remedies. Upon the occurrence of any Event of Default, (a) interest
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shall automatically and without notice begin to accrue on the outstanding
balance of this Note at the Interest Rate plus two percent, (b) the entire
unpaid principal amount of this Note and all unpaid interest accrued thereon
shall, at the sole option of Lender upon notice to Borrower, become immediately
due and payable, (c) Lender shall have the right to offset all amounts owed by
Borrower hereunder against any amounts owed by Xxxxxx in any capacity to
Borrower, whether or not due, and (d) Lender shall thereupon have the immediate
right to exercise from time to time all rights and remedies now or hereafter
available at law or in equity, all of which shall be cumulative in nature
including the right to exercise its remedies with respect to any collateral
securing this Note under the Security Agreement or otherwise.
7. Security. The obligations of Borrower hereunder are secured by a
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security interest in certain of the assets of Xxxxxxxx, as provided in the
Letter Agreement and the Security Agreement from the Borrower of even date
herewith (the "Security Agreement").
8. Miscellaneous. Except as expressly set forth herein, Borrower hereby
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waives presentment, demand, protest and notice of dishonor and protest, and also
waives all other exemptions; and agrees that extension or extensions of the time
of payment of this Note or any installment or part thereof may be made before,
at or after maturity by agreement by Lender. Borrower shall pay to Lender, upon
demand, all costs and expenses that may be incurred by
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Lender in connection with the enforcement of this Note including, without
limitation, fees and expenses of Xxxxxx's counsel. Any failure by Lender to
exercise any right hereunder shall not be construed as a waiver of the right to
exercise the same or any other right at any time. No amendment to or
modification of this Note shall be binding upon Lender unless in writing and
signed by it. Any provision hereof found to be illegal, invalid or unenforceable
for any reason whatsoever shall not affect the legality, validity or
enforceability of the remainder hereof. This Note shall apply to and bind
Xxxxxxxx, his heirs, administrators, successors and assigns and shall inure to
the benefit of Xxxxxx, its successors and assigns; provided, however, that
Xxxxxxxx may not assign his rights and obligations under this Note without the
express prior written consent of Xxxxxx. No course of dealing on the part of the
Lender, nor any delay or failure on the part of the Lender to exercise any
right, shall operate as a waiver of such right or otherwise prejudice the
Lender's rights, powers and remedies. The rights, powers and remedies of the
Lender, permitted by law or contract or as stated herein, shall be cumulative
and concurrent and may be exercised or otherwise pursued by the Lender singly,
successively, or together against Borrower at the sole discretion of Lender; and
the failure to exercise any such right, power or remedy shall in no event be
construed as a waiver or release of the same. Lender shall not by any act of
omission or commission be deemed to waive any of its rights, powers or remedies
hereunder unless such waiver be in writing and signed by Xxxxxx, and then only
to the extent specifically set forth therein; and a waiver of one event shall
not be construed as continuing or as a bar to or waiver of such right, power or
remedy on a subsequent event. This Note shall be governed by and interpreted in
accordance with the laws of the Commonwealth of Pennsylvania. Borrower hereby
consents to the jurisdiction of the courts of Pennsylvania in any action or
proceeding which may be brought against Borrower under or in connection with
this Note, and in the event any such action or proceeding shall be brought
against Borrower, Borrower agrees not to raise any objection to such
jurisdiction or to the laying of the venue thereof in Philadelphia,
Pennsylvania.
IN WITNESS WHEREOF, Xxxxxxxx, intending to be legally bound hereby, has
duly executed this Note as of the date first written above.
/s/ Xxxxxx Xxxxxx /s/ Xxxxxx X. Xxxxxx
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Witness Borrower: Xxxxxx X. Xxxxxx
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SCHEDULE A
TRANSACTIONS ON NOTE
Date Loans Payments Interest Paid Balance
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October 18, 2000 $7,400,000 $ 7,200,000
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October 18, 2000 $2,600,000 $10,000,000
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