Exhibit 10.2
TERM NOTE
$1,180,000 June 27, 2002
FOR VALUE RECEIVED, the undersigned, BOUNDLESS TECHNOLOGIES, INC. ("BTI"),
BOUNDLESS MANUFACTURING SERVICES, INC. ("BMS"), BOUNDLESS ACQUISITION CORP.
("BAC") and BOUNDLESS CORPORATION ("BC"; with BTI, BMS and BAC, each a
"Co-Borrower" and, collectively, the "Co-Borrowers"), each a Delaware
corporation, jointly and severally, promise to pay to the order of JPMORGAN
CHASE BANK (the "Bank"), on June 26, 2007 (the "Maturity Date"), the sum of ONE
MILLION ONE HUNDRED EIGHTY THOUSAND ($1,180,000) DOLLARS (the "Term Loan"), to
be paid as follows: (A) $152,000, to be paid upon the earlier to occur of (i)
the closing of the Sale (as such term is defined in the Letter Agreement, dated
as of the date hereof, among the Lenders (as hereinafter defined), the
Co-Borrowers and The CIT Group/Business Credit, Inc.) or (ii) September 27,
2002, followed by (B) fifty one (51) consecutive equal monthly installments of
$17,133.33 each, commencing on the earlier to occur of (i) an Equity Event (as
hereinafter defined) or (ii) April 1, 2003, and continuing on the first day of
each month thereafter, provided, however, that the last such payment shall be in
the amount necessary to repay in full the unpaid principal amount of Term Loan.
The Co-Borrowers also, jointly and severally, promise to pay interest, from the
date of this Note until such principal amount becomes due, on the unpaid
principal amount hereof, commencing July 1, 2002, and continuing on the first
day of each month thereafter, at a rate of five percent (5.0%) per annum (the
"Interest Rate"). Interest shall be calculated on the basis of a 360-day year
for the actual number of days elapsed. All payments hereunder shall be payable
in immediately available funds in lawful money of the United States. Each
Co-Borrower authorizes the Bank to charge any Co-Borrower's accounts for
payments of principal or interest. For purposes of this Note, "Equity Event"
shall mean an event which results in an equity infusion of not less than
$2,000,000 to BC.
The Co-Borrowers may, at any time and from time to time, prepay this Note,
in whole or in part, without premium or penalty, upon three business day's prior
written or telephonic notice thereof to the Bank. All prepayments shall be
accompanied by accrued interest on the principal amount being prepaid to the
date of prepayment.
Any payment of principal of or interest payable hereunder which is not
paid when due, whether at maturity, by acceleration, or otherwise, shall bear
interest from the date due until paid in full at a rate per annum equal to five
percent (5%) above the Interest Rate.
Upon the occurrence and continuance of an Event of Default under that
certain Mortgage, dated as of the date hereof, by BTI, as Mortgagor, and
JPMorgan Chase Bank, as collateral agent for the JPMorgan Chase Bank, Silicon
Valley Bank and National Bank of Canada (collectively, the "Lenders"), as
mortgagee (the "Mortgage"), then this Note
shall, at the sole option of the Bank, become due and payable without notice or
demand; provided, however, if an Event of Default described in clause (n) or
clause (o) of Paragraph 22 of the Mortgage occurs, this Note shall automatically
become due and payable.
Upon the occurrence and during the continuance of an Event of Default, the
Bank shall be entitled to exercise any other right or remedy granted hereunder,
or under any agreement between any Co-Borrower and the Bank or available at law
or in equity, including, but not limited to, the rights and remedies of a
secured party under the New York Uniform Commercial Code. The failure by the
Bank at any time to exercise any such right shall not be deemed a waiver
thereof, nor shall it bar the exercise of any such right at a later date. Each
and every right and remedy granted to the Bank hereunder or under any agreement
between any Co-Borrower and the Bank or available at law or in equity shall be
cumulative and not exclusive of any other rights, powers, privileges or
remedies, and may be exercised by the Bank from time to time and as often as may
be necessary in the sole and absolute discretion of the Bank.
In the event that the Bank for any reason shall refer this Note to an
attorney for the enforcement thereof, the Co-Borrowers agree to pay, in addition
to the unpaid principal, interest and late charges due hereunder, the Bank's
reasonable attorneys' fees (whether in-house or outside counsel), together with
all costs and expenses of any such action.
Each Co-Borrower represents and warrants that: (i) it is a corporation
duly formed, validly existing and in good standing under the laws of its state
of organization; (ii) it has the power and authority to own its assets and carry
on its business as now being conducted; (iii) it has the corporate power to
execute and perform each document to which it is a party; (iv) it has the power
and authority to borrow hereunder and to execute and deliver this Note; (v) it
is in compliance with all applicable federal, state and local laws, rules and
regulations; (vi) the borrowings by it hereunder, and the execution, delivery
and performance by it of the other documents to which it is a party (a) have
been duly authorized by all requisite corporate action, (b) will not violate or
require any consent under any provision of law, governmental rule or regulation,
or any indenture, agreement or other instrument to which any Co-Borrower is a
party, and (c) will not be in conflict with, result in a breach of or constitute
a default under any such indenture, agreement or other instrument, or result in
the creation or imposition of any lien, charge or encumbrance of any nature
whatsoever upon any of the property or assets of any Co-Borrower other than as
contemplated by this Note or the other documents to which any Co-Borrower is a
party. This Note and each other document to which any Co-Borrower is a party,
constitutes the legal, valid and binding obligation of each Co-Borrower, to the
extent they are a party thereto, enforceable against such Co-Borrower in
accordance with its terms.
EACH CO-BORROWER HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY
FEDERAL OR STATE COURT IN THE STATE OF NEW YORK IN ANY ACTION, SUIT OR
PROCEEDING BROUGHT AGAINST IT AND RELATED TO OR IN CONNECTION WITH THIS NOTE OR
ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY AND CONSENTS TO THE PLACING OF VENUE
IN THE COUNTY OF NASSAU OR COUNTY OF SUFFOLK PERMITTED
2
BY LAW. TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH CO-BORROWER HEREBY
WAIVES AND AGREES NOT TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE, IN
ANY SUCH SUIT, ACTION OR PROCEEDING ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT
TO THE JURISDICTION OF SUCH COURTS, THAT THE SUIT, ACTION OR PROCEEDING IS
BROUGHT IN AN INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR
PROCEEDING IS IMPROPER, OR THAT THIS NOTE OR ANY OTHER DOCUMENT OR INSTRUMENT
REFERRED TO HEREIN MAY NOT BE LITIGATED IN OR BY SUCH COURTS. TO THE EXTENT
PERMITTED BY APPLICABLE LAW, EACH CO-BORROWER AGREES NOT TO SEEK AND HEREBY
WAIVES THE RIGHT TO ANY REVIEW OF THE JUDGMENT OF ANY SUCH COURT BY ANY COURT OF
ANY OTHER NATION OR JURISDICTION WHICH MAY BE CALLED UPON TO GRANT AN
ENFORCEMENT OF SUCH JUDGMENT. EACH CO-BORROWER AGREES THAT SERVICE OF PROCESS
MAY BE MADE UPON IT BY CERTIFIED OR REGISTERED MAIL TO ITS ADDRESS SET FORTH
BELOW OR SUCH OTHER ADDRESS THAT THE CO-BORROWERS SHALL HAVE NOTIFIED THE BANK
IN WRITING OR ANY METHOD AUTHORIZED BY THE LAWS OF THE STATE OF NEW YORK. EXCEPT
AS PROHIBITED BY LAW, EACH CO-BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS NOTE.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICT OR
CHOICE OF LAWS.
The Bank shall not, by any act, delay, omission or otherwise, be deemed to
have waived any of its rights and/or remedies hereunder. No change, amendment,
modification, termination, waiver, or discharge, in whole or in part, of any
provision of this Note shall be effective unless in writing and signed by the
Bank, and if so given by the Bank, shall be effective only in the specific
instance in which given. Each Co-Borrower acknowledges that this Note and the
Co-Borrowers' obligations under this Note are, and shall at all times continue
to be, absolute and unconditional in all respects, and shall at all times be
valid and enforceable irrespective of any other agreements or circumstances of
any nature whatsoever which might otherwise constitute a defense to this Note
and the obligations of the Co-Borrowers under this Note. Each Co-Borrower
absolutely, unconditionally and irrevocably waives any and all right to assert
any set-off, counterclaim or crossclaim of any nature whatsoever with respect to
this Note or the Co-Borrowers' obligations hereunder.
In the event any one or more of the provisions contained in this Note
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.
3
Each Co-Borrower hereby waives presentment, demand for payment, protest,
notice of dishonor, and any and all other notices or demands in connection with
the delivery, acceptance, performance, default, or enforcement of this Note.
The term "Bank" as used herein shall be deemed to include the Bank and its
successors and assigns, and any holder hereof.
To the extent any obligation hereunder is the obligation of more than one
Co-Borrower, such obligation shall be a joint and several obligation of such
Co-Borrowers. The Bank may proceed against one or more of the Co-Borrowers at
one time or from time to time as it elects in its sole and absolute discretion.
At no time shall the rate of interest charged under this Note exceed the
maximum rate of interest permitted under applicable law. If at any time the
Interest Rate shall exceed such maximum rate, and thereafter the Interest Rate
is below such maximum rate, then the Interest Rate shall be increased to the
maximum rate for such period of time as is required so that the total amount of
interest received by the Bank is that which would have been received by the Bank
but for the first sentence of this paragraph.
In the event that any change in applicable law or regulation, or in the
interpretation thereof by any governmental authority charged with the
administration thereof, shall impose on or deem applicable to the Bank any
reserve requirements against this Note or impose upon the Bank any other costs
or assessments, the Co-Borrowers shall pay to the Bank on demand an amount
sufficient to compensate the Bank for the additional cost resulting from the
maintenance or imposition of such reserves, costs or assessments.
Any consents, agreements, instructions or requests pertaining to any
matter in connection with this Note, signed by any one Co-Borrower, shall be
binding upon all of the Co-Borrowers. This Note shall bind the respective
successors, heirs or representatives of each Co-Borrower. This Note shall not be
assigned by the Co-Borrowers without the Bank's prior written consent.
[next page is signature page]
4
IN WITNESS WHEREOF, the undersigned have duly executed this Note as of the
day and year first above written.
BOUNDLESS TECHNOLOGIES, INC.
BOUNDLESS MANUFACTURING SERVICES, INC.
BOUNDLESS ACQUISITION CORP.
BOUNDLESS CORPORATION
By: /s/ Xxxxxx Xxxxxxx
------------------
Name: Xxxxxx Xxxxxxx
Title: the Vice President of each of the
foregoing corporations
Borrowers' Address:
000 Xxxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
Telecopy: _________________
5
TERM NOTE
$1,180,000 June 27, 2002
FOR VALUE RECEIVED, the undersigned, BOUNDLESS TECHNOLOGIES, INC. ("BTI"),
BOUNDLESS MANUFACTURING SERVICES, INC. ("BMS"), BOUNDLESS ACQUISITION CORP.
("BAC") and BOUNDLESS CORPORATION ("BC"; with BTI, BMS and BAC, each a
"Co-Borrower" and, collectively, the "Co-Borrowers"), each a Delaware
corporation, jointly and severally, promise to pay to the order of SILICON
VALLEY BANK (the "Bank"), on June 26, 2007 (the "Maturity Date"), the sum of ONE
MILLION ONE HUNDRED EIGHTY THOUSAND ($1,180,000) DOLLARS (the "Term Loan"), to
be paid as follows: (A) $152,000, to be paid upon the earlier to occur of (i)
the closing of the Sale (as such term is defined in the Letter Agreement, dated
as of the date hereof, among the Lenders (as hereinafter defined), the
Co-Borrowers and The CIT Group/Business Credit, Inc.) or (ii) September 27,
2002, followed by (B) fifty one (51) consecutive equal monthly installments of
$17,133.33 each, commencing on the earlier to occur of (i) an Equity Event (as
hereinafter defined) or (ii) April 1, 2003, and continuing on the first day of
each month thereafter, provided, however, that the last such payment shall be in
the amount necessary to repay in full the unpaid principal amount of Term Loan.
The Co-Borrowers also, jointly and severally, promise to pay interest, from the
date of this Note until such principal amount becomes due, on the unpaid
principal amount hereof, commencing July 1, 2002, and continuing on the first
day of each month thereafter, at a rate of five percent (5.0%) per annum (the
"Interest Rate"). Interest shall be calculated on the basis of a 360-day year
for the actual number of days elapsed. All payments hereunder shall be payable
in immediately available funds in lawful money of the United States. Each
Co-Borrower authorizes the Bank to charge any Co-Borrower's accounts for
payments of principal or interest. For purposes of this Note, "Equity Event"
shall mean an event which results in an equity infusion of not less than
$2,000,000 to BC.
The Co-Borrowers may, at any time and from time to time, prepay this Note,
in whole or in part, without premium or penalty, upon three business day's prior
written or telephonic notice thereof to the Bank. All prepayments shall be
accompanied by accrued interest on the principal amount being prepaid to the
date of prepayment.
Any payment of principal of or interest payable hereunder which is not
paid when due, whether at maturity, by acceleration, or otherwise, shall bear
interest from the date due until paid in full at a rate per annum equal to five
percent (5%) above the Interest Rate.
Upon the occurrence and continuance of an Event of Default under that
certain Mortgage, dated as of the date hereof, by BTI, as Mortgagor, and
JPMorgan Chase Bank, as collateral agent for the JPMorgan Chase Bank, Silicon
Valley Bank and National Bank
1
of Canada (collectively, the "Lenders"), as mortgagee (the "Mortgage"), then
this Note shall, at the sole option of the Bank, become due and payable without
notice or demand; provided, however, if an Event of Default described in clause
(n) or clause (o) of Paragraph 22 of the Mortgage occurs, this Note shall
automatically become due and payable.
Upon the occurrence and during the continuance of an Event of Default, the
Bank shall be entitled to exercise any other right or remedy granted hereunder,
or under any agreement between any Co-Borrower and the Bank or available at law
or in equity, including, but not limited to, the rights and remedies of a
secured party under the New York Uniform Commercial Code. The failure by the
Bank at any time to exercise any such right shall not be deemed a waiver
thereof, nor shall it bar the exercise of any such right at a later date. Each
and every right and remedy granted to the Bank hereunder or under any agreement
between any Co-Borrower and the Bank or available at law or in equity shall be
cumulative and not exclusive of any other rights, powers, privileges or
remedies, and may be exercised by the Bank from time to time and as often as may
be necessary in the sole and absolute discretion of the Bank.
In the event that the Bank for any reason shall refer this Note to an
attorney for the enforcement thereof, the Co-Borrowers agree to pay, in addition
to the unpaid principal, interest and late charges due hereunder, the Bank's
reasonable attorneys' fees (whether in-house or outside counsel), together with
all costs and expenses of any such action.
Each Co-Borrower represents and warrants that: (i) it is a corporation
duly formed, validly existing and in good standing under the laws of its state
of organization; (ii) it has the power and authority to own its assets and carry
on its business as now being conducted; (iii) it has the corporate power to
execute and perform each document to which it is a party; (iv) it has the power
and authority to borrow hereunder and to execute and deliver this Note; (v) it
is in compliance with all applicable federal, state and local laws, rules and
regulations; (vi) the borrowings by it hereunder, and the execution, delivery
and performance by it of the other documents to which it is a party (a) have
been duly authorized by all requisite corporate action, (b) will not violate or
require any consent under any provision of law, governmental rule or regulation,
or any indenture, agreement or other instrument to which any Co-Borrower is a
party, and (c) will not be in conflict with, result in a breach of or constitute
a default under any such indenture, agreement or other instrument, or result in
the creation or imposition of any lien, charge or encumbrance of any nature
whatsoever upon any of the property or assets of any Co-Borrower other than as
contemplated by this Note or the other documents to which any Co-Borrower is a
party. This Note and each other document to which any Co-Borrower is a party,
constitutes the legal, valid and binding obligation of each Co-Borrower, to the
extent they are a party thereto, enforceable against such Co-Borrower in
accordance with its terms.
EACH CO-BORROWER HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY
FEDERAL OR STATE COURT IN THE STATE OF NEW YORK IN ANY ACTION, SUIT OR
PROCEEDING BROUGHT AGAINST IT AND
2
RELATED TO OR IN CONNECTION WITH THIS NOTE OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY AND CONSENTS TO THE PLACING OF VENUE IN THE COUNTY OF NASSAU
OR COUNTY OF SUFFOLK PERMITTED BY LAW. TO THE EXTENT PERMITTED BY APPLICABLE
LAW, EACH CO-BORROWER HEREBY WAIVES AND AGREES NOT TO ASSERT BY WAY OF MOTION,
AS A DEFENSE OR OTHERWISE, IN ANY SUCH SUIT, ACTION OR PROCEEDING ANY CLAIM THAT
IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF SUCH COURTS, THAT THE SUIT,
ACTION OR PROCEEDING IS BROUGHT IN AN INCONVENIENT FORUM, THAT THE VENUE OF THE
SUIT, ACTION OR PROCEEDING IS IMPROPER, OR THAT THIS NOTE OR ANY OTHER DOCUMENT
OR INSTRUMENT REFERRED TO HEREIN MAY NOT BE LITIGATED IN OR BY SUCH COURTS. TO
THE EXTENT PERMITTED BY APPLICABLE LAW, EACH CO-BORROWER AGREES NOT TO SEEK AND
HEREBY WAIVES THE RIGHT TO ANY REVIEW OF THE JUDGMENT OF ANY SUCH COURT BY ANY
COURT OF ANY OTHER NATION OR JURISDICTION WHICH MAY BE CALLED UPON TO GRANT AN
ENFORCEMENT OF SUCH JUDGMENT. EACH CO-BORROWER AGREES THAT SERVICE OF PROCESS
MAY BE MADE UPON IT BY CERTIFIED OR REGISTERED MAIL TO ITS ADDRESS SET FORTH
BELOW OR SUCH OTHER ADDRESS THAT THE CO-BORROWERS SHALL HAVE NOTIFIED THE BANK
IN WRITING OR ANY METHOD AUTHORIZED BY THE LAWS OF THE STATE OF NEW YORK. EXCEPT
AS PROHIBITED BY LAW, EACH CO-BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS NOTE.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICT OR
CHOICE OF LAWS.
The Bank shall not, by any act, delay, omission or otherwise, be deemed to
have waived any of its rights and/or remedies hereunder. No change, amendment,
modification, termination, waiver, or discharge, in whole or in part, of any
provision of this Note shall be effective unless in writing and signed by the
Bank, and if so given by the Bank, shall be effective only in the specific
instance in which given. Each Co-Borrower acknowledges that this Note and the
Co-Borrowers' obligations under this Note are, and shall at all times continue
to be, absolute and unconditional in all respects, and shall at all times be
valid and enforceable irrespective of any other agreements or circumstances of
any nature whatsoever which might otherwise constitute a defense to this Note
and the obligations of the Co-Borrowers under this Note. Each Co-Borrower
absolutely, unconditionally and irrevocably waives any and all right to assert
any set-off, counterclaim or crossclaim of any nature whatsoever with respect to
this Note or the Co-Borrowers' obligations hereunder.
In the event any one or more of the provisions contained in this Note
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of
3
the remaining provisions contained herein shall not in any way be affected or
impaired thereby.
Each Co-Borrower hereby waives presentment, demand for payment, protest,
notice of dishonor, and any and all other notices or demands in connection with
the delivery, acceptance, performance, default, or enforcement of this Note.
The term "Bank" as used herein shall be deemed to include the Bank and its
successors and assigns, and any holder hereof.
To the extent any obligation hereunder is the obligation of more than one
Co-Borrower, such obligation shall be a joint and several obligation of such
Co-Borrowers. The Bank may proceed against one or more of the Co-Borrowers at
one time or from time to time as it elects in its sole and absolute discretion.
At no time shall the rate of interest charged under this Note exceed the
maximum rate of interest permitted under applicable law. If at any time the
Interest Rate shall exceed such maximum rate, and thereafter the Interest Rate
is below such maximum rate, then the Interest Rate shall be increased to the
maximum rate for such period of time as is required so that the total amount of
interest received by the Bank is that which would have been received by the Bank
but for the first sentence of this paragraph.
In the event that any change in applicable law or regulation, or in the
interpretation thereof by any governmental authority charged with the
administration thereof, shall impose on or deem applicable to the Bank any
reserve requirements against this Note or impose upon the Bank any other costs
or assessments, the Co-Borrowers shall pay to the Bank on demand an amount
sufficient to compensate the Bank for the additional cost resulting from the
maintenance or imposition of such reserves, costs or assessments.
Any consents, agreements, instructions or requests pertaining to any
matter in connection with this Note, signed by any one Co-Borrower, shall be
binding upon all of the Co-Borrowers. This Note shall bind the respective
successors, heirs or representatives of each Co-Borrower. This Note shall not be
assigned by the Co-Borrowers without the Bank's prior written consent.
[next page is signature page]
4
IN WITNESS WHEREOF, the undersigned have duly executed this Note as of the
day and year first above written.
BOUNDLESS TECHNOLOGIES, INC.
BOUNDLESS MANUFACTURING SERVICES, INC.
BOUNDLESS ACQUISITION CORP.
BOUNDLESS CORPORATION
By: /s/ Xxxxxx Xxxxxxx
------------------
Name: Xxxxxx Xxxxxxx
Title: the Vice President of each of the
foregoing corporations
Borrowers' Address:
000 Xxxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
Telecopy: _________________
5
TERM NOTE
$590,000 June 27, 2002
FOR VALUE RECEIVED, the undersigned, BOUNDLESS TECHNOLOGIES, INC. ("BTI"),
BOUNDLESS MANUFACTURING SERVICES, INC. ("BMS"), BOUNDLESS ACQUISITION CORP.
("BAC") and BOUNDLESS CORPORATION ("BC"; with BTI, BMS and BAC, each a
"Co-Borrower" and, collectively, the "Co-Borrowers"), each a Delaware
corporation, jointly and severally, promise to pay to the order of NATIONAL BANK
OF CANADA (the "Bank"), on June 26, 2007 (the "Maturity Date"), the sum of FIVE
HUNDRED NINETY THOUSAND ($590,000) DOLLARS (the "Term Loan"), to be paid as
follows: (A) $76,000, to be paid upon the earlier to occur of (i) the closing of
the Sale (as such term is defined in the Letter Agreement, dated as of the date
hereof, among the Lenders (as hereinafter defined), the Co-Borrowers and The CIT
Group/Business Credit, Inc.) or (ii) September 27, 2002, followed by (B) fifty
one (51) consecutive equal monthly installments of $8,566.67 each, commencing on
the earlier to occur of (i) an Equity Event (as hereinafter defined) or (ii)
April 1, 2003, and continuing on the first day of each month thereafter,
provided, however, that the last such payment shall be in the amount necessary
to repay in full the unpaid principal amount of Term Loan. The Co-Borrowers
also, jointly and severally, promise to pay interest, from the date of this Note
until such principal amount becomes due, on the unpaid principal amount hereof,
commencing July 1, 2002, and continuing on the first day of each month
thereafter, at a rate of five percent (5.0%) per annum (the "Interest Rate").
Interest shall be calculated on the basis of a 360-day year for the actual
number of days elapsed. All payments hereunder shall be payable in immediately
available funds in lawful money of the United States. Each Co-Borrower
authorizes the Bank to charge any Co-Borrower's accounts for payments of
principal or interest. For purposes of this Note, "Equity Event" shall mean an
event which results in an equity infusion of not less than $2,000,000 to BC.
The Co-Borrowers may, at any time and from time to time, prepay this Note,
in whole or in part, without premium or penalty, upon three business day's prior
written or telephonic notice thereof to the Bank. All prepayments shall be
accompanied by accrued interest on the principal amount being prepaid to the
date of prepayment.
Any payment of principal of or interest payable hereunder which is not
paid when due, whether at maturity, by acceleration, or otherwise, shall bear
interest from the date due until paid in full at a rate per annum equal to five
percent (5%) above the Interest Rate.
Upon the occurrence and continuance of an Event of Default under that
certain Mortgage, dated as of the date hereof, by BTI, as Mortgagor, and
JPMorgan Chase Bank, as collateral agent for the JPMorgan Chase Bank, Silicon
Valley Bank and National Bank of Canada (collectively, the "Lenders"), as
mortgagee (the "Mortgage"), then this Note
1
shall, at the sole option of the Bank, become due and payable without notice or
demand; provided, however, if an Event of Default described in clause (n) or
clause (o) of Paragraph 22 of the Mortgage occurs, this Note shall automatically
become due and payable.
Upon the occurrence and during the continuance of an Event of Default, the
Bank shall be entitled to exercise any other right or remedy granted hereunder,
or under any agreement between any Co-Borrower and the Bank or available at law
or in equity, including, but not limited to, the rights and remedies of a
secured party under the New York Uniform Commercial Code. The failure by the
Bank at any time to exercise any such right shall not be deemed a waiver
thereof, nor shall it bar the exercise of any such right at a later date. Each
and every right and remedy granted to the Bank hereunder or under any agreement
between any Co-Borrower and the Bank or available at law or in equity shall be
cumulative and not exclusive of any other rights, powers, privileges or
remedies, and may be exercised by the Bank from time to time and as often as may
be necessary in the sole and absolute discretion of the Bank.
In the event that the Bank for any reason shall refer this Note to an
attorney for the enforcement thereof, the Co-Borrowers agree to pay, in addition
to the unpaid principal, interest and late charges due hereunder, the Bank's
reasonable attorneys' fees (whether in-house or outside counsel), together with
all costs and expenses of any such action.
Each Co-Borrower represents and warrants that: (i) it is a corporation
duly formed, validly existing and in good standing under the laws of its state
of organization; (ii) it has the power and authority to own its assets and carry
on its business as now being conducted; (iii) it has the corporate power to
execute and perform each document to which it is a party; (iv) it has the power
and authority to borrow hereunder and to execute and deliver this Note; (v) it
is in compliance with all applicable federal, state and local laws, rules and
regulations; (vi) the borrowings by it hereunder, and the execution, delivery
and performance by it of the other documents to which it is a party (a) have
been duly authorized by all requisite corporate action, (b) will not violate or
require any consent under any provision of law, governmental rule or regulation,
or any indenture, agreement or other instrument to which any Co-Borrower is a
party, and (c) will not be in conflict with, result in a breach of or constitute
a default under any such indenture, agreement or other instrument, or result in
the creation or imposition of any lien, charge or encumbrance of any nature
whatsoever upon any of the property or assets of any Co-Borrower other than as
contemplated by this Note or the other documents to which any Co-Borrower is a
party. This Note and each other document to which any Co-Borrower is a party,
constitutes the legal, valid and binding obligation of each Co-Borrower, to the
extent they are a party thereto, enforceable against such Co-Borrower in
accordance with its terms.
EACH CO-BORROWER HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY FEDERAL OR
STATE COURT IN THE STATE OF NEW YORK IN ANY ACTION, SUIT OR PROCEEDING BROUGHT
AGAINST IT AND RELATED TO OR IN CONNECTION WITH THIS NOTE OR ANY OF THE
2
TRANSACTIONS CONTEMPLATED HEREBY AND CONSENTS TO THE PLACING OF VENUE IN THE
COUNTY OF NASSAU OR COUNTY OF SUFFOLK PERMITTED BY LAW. TO THE EXTENT PERMITTED
BY APPLICABLE LAW, EACH CO-BORROWER HEREBY WAIVES AND AGREES NOT TO ASSERT BY
WAY OF MOTION, AS A DEFENSE OR OTHERWISE, IN ANY SUCH SUIT, ACTION OR PROCEEDING
ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF SUCH COURTS,
THAT THE SUIT, ACTION OR PROCEEDING IS BROUGHT IN AN INCONVENIENT FORUM, THAT
THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS IMPROPER, OR THAT THIS NOTE OR
ANY OTHER DOCUMENT OR INSTRUMENT REFERRED TO HEREIN MAY NOT BE LITIGATED IN OR
BY SUCH COURTS. TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH CO-BORROWER
AGREES NOT TO SEEK AND HEREBY WAIVES THE RIGHT TO ANY REVIEW OF THE JUDGMENT OF
ANY SUCH COURT BY ANY COURT OF ANY OTHER NATION OR JURISDICTION WHICH MAY BE
CALLED UPON TO GRANT AN ENFORCEMENT OF SUCH JUDGMENT. EACH CO-BORROWER AGREES
THAT SERVICE OF PROCESS MAY BE MADE UPON IT BY CERTIFIED OR REGISTERED MAIL TO
ITS ADDRESS SET FORTH BELOW OR SUCH OTHER ADDRESS THAT THE CO-BORROWERS SHALL
HAVE NOTIFIED THE BANK IN WRITING OR ANY METHOD AUTHORIZED BY THE LAWS OF THE
STATE OF NEW YORK. EXCEPT AS PROHIBITED BY LAW, EACH CO-BORROWER HEREBY WAIVES
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY
OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICT OR
CHOICE OF LAWS.
The Bank shall not, by any act, delay, omission or otherwise, be deemed to
have waived any of its rights and/or remedies hereunder. No change, amendment,
modification, termination, waiver, or discharge, in whole or in part, of any
provision of this Note shall be effective unless in writing and signed by the
Bank, and if so given by the Bank, shall be effective only in the specific
instance in which given. Each Co-Borrower acknowledges that this Note and the
Co-Borrowers' obligations under this Note are, and shall at all times continue
to be, absolute and unconditional in all respects, and shall at all times be
valid and enforceable irrespective of any other agreements or circumstances of
any nature whatsoever which might otherwise constitute a defense to this Note
and the obligations of the Co-Borrowers under this Note. Each Co-Borrower
absolutely, unconditionally and irrevocably waives any and all right to assert
any set-off, counterclaim or crossclaim of any nature whatsoever with respect to
this Note or the Co-Borrowers' obligations hereunder.
In the event any one or more of the provisions contained in this Note
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.
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Each Co-Borrower hereby waives presentment, demand for payment, protest,
notice of dishonor, and any and all other notices or demands in connection with
the delivery, acceptance, performance, default, or enforcement of this Note.
The term "Bank" as used herein shall be deemed to include the Bank and its
successors and assigns, and any holder hereof.
To the extent any obligation hereunder is the obligation of more than one
Co-Borrower, such obligation shall be a joint and several obligation of such
Co-Borrowers. The Bank may proceed against one or more of the Co-Borrowers at
one time or from time to time as it elects in its sole and absolute discretion.
At no time shall the rate of interest charged under this Note exceed the
maximum rate of interest permitted under applicable law. If at any time the
Interest Rate shall exceed such maximum rate, and thereafter the Interest Rate
is below such maximum rate, then the Interest Rate shall be increased to the
maximum rate for such period of time as is required so that the total amount of
interest received by the Bank is that which would have been received by the Bank
but for the first sentence of this paragraph.
In the event that any change in applicable law or regulation, or in the
interpretation thereof by any governmental authority charged with the
administration thereof, shall impose on or deem applicable to the Bank any
reserve requirements against this Note or impose upon the Bank any other costs
or assessments, the Co-Borrowers shall pay to the Bank on demand an amount
sufficient to compensate the Bank for the additional cost resulting from the
maintenance or imposition of such reserves, costs or assessments.
Any consents, agreements, instructions or requests pertaining to any
matter in connection with this Note, signed by any one Co-Borrower, shall be
binding upon all of the Co-Borrowers. This Note shall bind the respective
successors, heirs or representatives of each Co-Borrower. This Note shall not be
assigned by the Co-Borrowers without the Bank's prior written consent.
[next page is signature page]
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IN WITNESS WHEREOF, the undersigned have duly executed this Note as of the
day and year first above written.
BOUNDLESS TECHNOLOGIES, INC.
BOUNDLESS MANUFACTURING SERVICES, INC.
BOUNDLESS ACQUISITION CORP.
BOUNDLESS CORPORATION
By: /s/ Xxxxxx Xxxxxxx
------------------
Name: Xxxxxx Xxxxxxx
Title: the Vice President of each of the
foregoing corporations
Borrowers' Address:
000 Xxxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
Telecopy: _________________
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