REVOLVING CREDIT AGREEMENT Between: THE KOSKI FAMILY LIMITED PARTNERSHIP, a Texas Limited Partnership as “Lender” and ORAGENICS, Inc., a Florida Corporation as “Borrower”. Loan Amount: $2,000,000.00 Date: July ___, 2010
Exhibit
2.2(c)
Between:
THE
XXXXX FAMILY LIMITED PARTNERSHIP,
a Texas
Limited Partnership
as “Lender”
and
ORAGENICS, Inc.,
a Florida
Corporation
as “Borrower”.
Loan
Amount: $2,000,000.00
Date:
July ___, 2010
THIS REVOLVING CREDIT AGREEMENT
(the "Agreement")
is made and entered into as of the ______ day of July, 2010, by and between
THE XXXXX FAMILY LIMITED
PARTNERSHIP, a Texas Limited Partnership ("Lender"), having an address
for the purposes hereof of 0000 Xxxxxx Xxxxx Xxxxxxxxx, Xxxx 00-X, Xxxxxx, Xxxxx
00000 and ORAGENICS,
INC., a Florida corporation ("Borrower"), having an address
of ___________________, Florida_________.
WITNESSETH:
WHEREAS, Borrower has applied
to Lender for a revolving loan in the principal amount of up to
$2,000,000.00, upon and subject to the terms and conditions hereof;
NOW, THEREFORE, for and in
consideration of the sum of $10.00 and for other good and valuable
considerations, the receipt and sufficiency of which are hereby acknowledged,
Lender and Borrower agree as follows:
ARTICLE
1
DEFINITIONS
AND PARTICULAR TERMS
For the purposes of this Agreement the
following terms shall have the following meanings:
Section
1.01. Affiliate: With
respect to any Person, (a) any other Person which directly or indirectly through
one or more intermediaries Controls, or is Controlled by, or is under common
Control with, (i) such Person or (ii) any general partner of such Person; (b)
any other Person 5% or more of the equity interest of which is held beneficially
or of record by (i) such Person or (ii) any general partner of such Person, and
(c) any general or limited partner of (i) such Person or (ii) any general
partner of such Person.
Section
1.02. Agreement:
This Credit Agreement, as amended, modified, restated or supplemented from time
to time.
Section
1.03. Bankruptcy
Code: Title 11 of the United States Code, as it may be amended
from time to time.
Section
1.04. Borrower: ORAGENICS,
INC., a Florida corporation, its successors and/or permitted
assigns.
Section
1.05. Code: The Uniform
Commercial Code as enacted from time to time within the State of Florida, and as
currently codified in Chapters 670 through 680, Florida
Statutes.
Section
1.06. Consistent
Basis. In reference to the application of GAAP, the accounting
principles observed in the current period are comparable in all material
respects to those appliced in the preceding period.
Section
1.07. Control,
Controlled, or Controlling: The possession, directly or indirectly, of
the power to cause the direction of the management of a Person, whether through
voting securities, by contract, family relationship or otherwise.
Section
1.08. Credit
Facility: The term loan made pursuant to the terms hereof and
as more particularly provided in Article Two hereof.
Section
1.09. Default
Condition: The occurrence of any event which, after
satisfaction of any requirement for the giving of notice or the lapse of time,
or both, would become an Event of Default.
1
Section
1.10. Default
Rate: The rate of interest payable under the Note after the
occurrence and during the continuance of any Event of Default.
Section
1.11. Event of
Default: Any one of the events or conditions described in
Article 7, provided that any requirement for the giving of notice or the lapse
of time, or both, has been satisfied.
Section
1.12. Fiscal
Year: With respect to any Person, the fiscal year of such
Person, as employed by such Person as of the date hereof. The terms
"Fiscal Quarter" and "Fiscal Month" shall correspond accordingly
thereto.
Section
1.13. GAAP: Generally
Accepted Accounting Principles and procedures of accounting in the United States
of America, as set forth in opinions and pronouncements of the Financial
Accounting Standards Board, or which otherwise have substantial authoritative
support and are applicable in the circumstances as of the date of any report
required herein or as of the date of an application of such principles as
required herein.
Section
1.14. Indebtedness: As to
any Person, (i) all indebtedness for borrowed money or for the deferred purchase
price of any property (other than accounts payable to trade creditors under
customary trade credit terms) or services for which the Person is liable as
principal, (ii) all indebtedness (excluding unaccrued finance charges) secured
by a Lien on property owned or being purchased by the Person, whether or not
such indebtedness shall have been assumed by the Person, (iii) all obligations
evidenced by bonds, debentures, notes or similar instruments, (iv) all
capitalized lease obligations (excluding unaccrued finance charges) of the
Person, (v) any arrangement (commonly described as a sale-leaseback transaction)
with any financial institution or other lender or investor providing for the
leasing to the Person of property which at the time has been or is to be sold or
transferred by the Person to the lender or investor, or which has been or is
being acquired from another Person by the lender or investor for the purpose of
leasing the property to the Person, (vi) all guaranties of such Person, (vii)
all obligations of partnerships or joint ventures in respect of which the Person
is primarily or secondarily liable as a partner or a joint venturer or otherwise
(provided that in any event for the purposes of determining the amount of the
Indebtedness, the full amount of such obligations, without giving effect to the
contingent liability or contributions of the other participants in the
partnership of joint venture, shall be included), and (ix) all redeemable
preferred stock of such Person valued at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid
dividends.
Section
1.15. Interest
Rate: An interest rate per annum as provided in the
Note.
Section
1.16. Laws: All statutes,
laws, ordinances, regulations, orders, writs, judgments, injunctions, decrees or
awards of the United States or any state, county, municipality or other
Governmental Entity applicable to Borrower or the operation or conduct of
Borrower's business.
Section
1.17. Lender: THE XXXXX
FAMILY LIMITED PARTNERSHIP, a Texas Limited Partnership, its successors and
assigns.
Section
1.18. Lien: Any mortgage,
deed of trust, pledge, hypothecation, assignment, deposit arrangement, lien,
charge, claim, security interest, encumbrance, or preference, priority or other
security agreement or preferential arrangement of any kind or nature whatsoever,
including without limitation any lease or title retention agreement or
arrangement, any financing lease having substantially the same economic effect
as any of the foregoing, and the filing of, or agreement to give, any financing
statement under the Code or comparable law of any other
jurisdiction.
Section
1.19. Loan
Documents: This Agreement, the Note, and any and all other
documents, instruments, affidavits, certificates and agreements executed and/or
delivered by Borrower in connection herewith or in connection with the Credit
Facility, whether executed prior to, at or subsequent to the date hereof,
together with all amendments, supplements or modifications in writing from time
to time, or any one, more or all of the foregoing, as the context shall
require.
2
Section
1.20. Note: The Note or
Note(s) executed in connection with this Agreement in the maximum aggregate
principal amount of $2,000,000.00, in the form attached hereto on Exhibit
1.21.
Section
1.21. Obligated
Party: Obligated Party shall have the meaning set forth in
Section 6.07.
Section
1.22. Obligations: Any
and all indebtednesses, liabilities and obligations of Borrower or any Obligated
Party, to Lender, including, without limiting the generality of the foregoing,
any indebtedness, liability or obligation of Borrower or any Obligated Party, to
Lender under any loan made to Borrower by Lender prior to the date hereof and
any and all extensions or renewals thereof in whole or in part; any
indebtedness, liability or obligation of Borrower, to Lender arising
hereunder or as a result hereof, whether evidenced by the Note or otherwise, and
any and all extensions or renewals thereof in whole or in part; any
indebtedness, liability or obligation of Borrower to Lender under any later or
future advances or loans made by Lender to Borrower, any and all extensions or
renewals thereof in whole or in part; and any and all future additional
indebtednesses, liabilities or obligations of Borrower to Lender whatsoever and
howsoever arising and in any event, whether existing as of the date hereof or
hereafter arising, whether arising under a loan, lease, line of credit, letter
of credit or other type of financing and whether direct, indirect, absolute or
contingent, as maker, endorser, guarantor, surety or otherwise, and whether
evidenced by, arising out of, or relating to, a promissory note, check, draft,
bond, letter of credit, guaranty agreement, or otherwise.
Section
1.23. Person: Any
individual, corporation, partnership, limited liability company, joint venture,
association, joint stock company, trust, unincorporated organization, government
or any agency or political subdivision thereof, or any other form of
entity.
Section
1.24. Plan: Any
pension plan which is covered by Title IV of ERISA and in respect of which the
Borrower or a commonly controlled entity of the Borrower is an “employer” as
defined in Section 407(d)(7) of ERISA.
Section
1.25. Solvent: With
respect to any Person, that:
(a) the
present, fair, salable value of such Person's assets is in excess of the total
amount of such Person's liabilities (including contingent, subordinated,
unmatured and unliquidated liabilities);
(b) such
Person has sufficient cash flow to enable it to pay its debts as they become
due;
(c) such Person does not have
unreasonably small capital to carry on such Person's
business.
The
phrase "present, fair, salable value of such Person's assets" is intended to
mean that value which can be obtained if the assets are sold within a reasonable
time in arm's length transactions in an existing and not a theoretical
market.
Section
1.26. Subsidiary: With
respect to any Person, any other Person of which fifty percent (50%) or more of
which the outstanding equity interests of which have ordinary voting power to
elect a majority of the governing body of such other Person, is at the time,
directly or indirectly, owned or controlled by such Person.
In
addition to the foregoing, the following provisions shall be applicable to the
construction and interpretation of this Agreement:
Section
1.27. Accounting
Terms. Accounting
terms not specifically defined herein shall have the meanings generally ascribed
to them under GAAP.
3
Section
1.28. Terminology. All
personal pronouns used in this Agreement, whether used in the masculine,
feminine, or neuter gender, shall include all other genders; the singular shall
include the plural, and the plural shall include the singular. The
words "hereof," "herein," and "hereunder" and words of similar import when used
in this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement, and Section, subsection, and exhibit
references are to this Agreement unless otherwise specified.
Section
1.29. Recital. The
recital contained in the beginning of this Agreement is an integral part hereof
and is hereby incorporated by reference for all purposes as if fully set forth
herein.
ARTICLE
2
THE
FINANCING
Section
2.01. Revolving
Loan. Upon
the execution of this Agreement and ongoing compliance with its terms and
conditions, Lender agrees to make, and Borrower agrees to take, an ongoing loan
in the principal amount of up to $2,000,000.00, which Credit Facility shall be
evidenced by a Note and shall accrue interest on the outstanding balance
existing from time to time as provided in and as payable under the Note at the
Interest Rate, with principal to be payable under and pursuant to the Note,
which has a final maturity of July 30, 2011. The proceeds of the Credit Facility
shall be used for general corporate purposes.
Section
2.02. Draw Downs.
So long as the Borrower is in compliance with the terms of the Loan
Documents, provides 15 days written notice of request for draw down to Lender at
the address of Lender set forth above (or as later changed in writing by
Lender), and provides Lender with such written notice, a No Adverse Change
Certificate in such form and substance acceptable to Lender, Borrower may draw
down on this Revolving Facility, sums in increments no smaller than $250,000.00
but in no event sums in excess of aggregate of $2,000,000.00 (when considering
all drawn downs made hereunder).
Section
2.03. Conditions
Precedent. The
closing of the Credit Facility and future draw downs on Loan sums shall be
conditioned upon the following conditions, which shall be absolute conditions
precedent to any funding of the Credit Facility:
(i) Lender
shall have received this Agreement duly executed and delivered by
Borrower;
(ii) Borrower
shall have executed and delivered to Lender a Note in the principal drawn
down;
(iii) Lender
shall receive a No Adverse Change Certificate executed and delivered by Borrower
in form and substance acceptable to Lender;
(iv) Borrower
shall be in compliance with the terms of all Loan Documents.
ARTICLE
3
REPRESENTATIONS
AND WARRANTIES
As an
inducement to Lender to enter into and execute this Agreement, Borrower
represents, covenants and warrants that:
Section
3.01. Incorporation
of Representations and Warranties. The Representations and Warranties
under the Common Stock Purchase Agreement of July 5, 2010 between the
parties are hereby incorporated herein by reference.
Section
3.02. Solvency. After
giving effect to the terms of this Agreement and the other Loan Documents,
Borrower is Solvent.
4
Section
3.03. Note Not
Security. Neither Borrower nor any agent acting on Borrower’s
behalf has, directly or indirectly, taken or will take any action which would
subject the issuance of the Note to the provisions of Section 5 of the
Securities Act of 1933, as amended from time to time, or to the provisions of
any securities or "Blue Sky" law of any applicable jurisdiction.
Section
3.04. No
Default. There is no default on the part of under this
Agreement, the Note, or any other Loan Document, and no event has occurred and
is continuing which with notice or the passage of time or either would
constitute a default under any thereof.
ARTICLE
4
GENERAL
COVENANTS
Borrower
covenants to Lender that from and after the date hereof, and so long as any
amounts remain unpaid on account of any of the Obligations, Borrower will comply
with the covenants set forth below:
Section
4.01. Payment of
Credit Facility and Performance of Covenants. Borrower shall
(i) make full and timely payments of the principal of and interest on the Note
and all other Obligations, whether now existing or hereafter arising, as and
when required by the Note or any instrument evidencing any other Obligation and
(ii) duly comply with all terms and covenants contained in each of the Loan
Documents.
Section
4.02. Payment of
Indebtedness, Taxes,
etc. Borrower a shall pay all of its Indebtedness and
Obligations promptly and in accordance with normal terms and comply in all
material respects with all material agreements, indentures, mortgages, security
agreements, or documents binding on it or affecting its properties or business
and shall pay and discharge or cause to be discharged promptly all taxes,
assessments or other charges or levies of Governmental Entities imposed on it or
its properties or upon any part thereof, before the same shall become in
default.
Section
4.03. Preserve
Existence. Borrower shall do or cause to be done all things
necessary to maintain, preserve and keep in full force and effect is existence
in the jurisdiction of its organization, and qualify and remain qualified in
each jurisdiction where qualification is necessary or desirable in view of its
business operations or the ownership of its properties.
Section
4.04. Conduct of
Business. Borrower shall continue to conduct and operate its
business substantially as conducted and operated by Borrower during the present
and preceding Fiscal Year and shall at all times maintain, preserve, and protect
all rights, privileges, patents, franchises, and trade names necessary or
desirable in the conduct of its business and shall preserve all of the remainder
of its property used or useful in connection with its business and keep the same
in good repair, working order, and condition, and shall from time to time make,
or cause to be made, all needful and proper repairs, replacements and
betterments thereto so that the business carried on in connection therewith may
be conducted properly and advantageously at all times.
Section
4.05. Compliance
with Laws. Borrower shall duly observe, conform and comply
with the requirements of all applicable law, rules, regulations and orders
(including without limitation Environmental Laws) of any Governmental Entities
relative to the conduct of its business, its properties and assets, except those
being contested in good faith by appropriate proceedings diligently pursued and
shall obtain and maintain in full force and effect as long as required all
governmental licenses, authorizations, consents and permits necessary for the
conduct of its business in any jurisdiction in which it does
business.
5
Section
4.06. Insurance. Borrower shall maintain
in full force and effect, pay all premiums when due in respect of,
and comply with all terms and conditions of each of the following insurance
coverages: (i) all risk property insurance covering all of its insurable
property, including without limitation all of its real property and all tangible
Collateral, for the full replacement value thereof, against physical loss or
damage by fire and other hazards as Lender shall require; (ii) comprehensive
general liability insurance written on an occurrence basis with a limit of not
less than $1,000,000.00 and not less than $2,000,000.00 in the aggregate; such
coverage shall include, but not be limited to, premises/operations, explosion,
collapse, contractual liability, independent contractors, products, completed
operations, property damage and personal injury liability; such insurance shall
not exclude coverage for punitive or exemplary damages where insurable by law;
(iii) workers' compensation insurance in accordance with statutory provisions
covering accidental injury, illness or death of employees of Borrower while at
work or in the scope of their employment with Borrower in such
amounts as are required by law; (iv) automobile liability insurance
covering owned, non-owned, leased, hired or borrowed vehicles against bodily
injury or property damage; such coverage shall have a limit of not
less than $1,000,000.00; and (v) all such other coverages as Lender
shall reasonably require from time to time. Borrower shall
cause each insurance policy (excluding workers' compensation insurance)
pertaining to the Collateral to (i) name Lender, its successors and assigns, as
an "additional insured" if such policy is a liability policy, (ii) name Lender,
its successors and assigns, as a "mortgagee" and "loss payee" and include a
standard loss payable endorsement in favor of Lender, its successors and
assigns, if such policy is a property insurance policy, (iii) provide that
Lender shall be notified in writing of any proposed cancellation or modification
of such policy initiated by Borrower's insurer at least thirty (30) days in
advance prior to any proposed cancellation or modification, (iv) provide that
all insurance proceeds for losses shall be payable to Lender, its successors or
assigns, as their interests may appear, regardless of any omission or breach of
Borrower, (v) waive any right of subrogation of the insurers against Lender, its
successors and assigns, and waive any right of the insurers to any setoff or
counterclaim or any other deduction, whether by attachment or otherwise, in
respect of any liability of Borrower, and (vi) provide that such insurance shall
be primary insurance, that the insurers under such insurance policies shall be
liable under such policies without right of contribution from any other
insurance coverage. Borrower, on or before the renewal date of
each policy of insurance, shall deliver to Lender copies of all policies or
certificates and loss payable endorsements issued by Borrower's insurers in
respect of all policies and endorsements as renewed. Borrower,
immediately upon receiving notice from the broker or insurance carrier of
cancellation or material modification of any policy required hereunder, shall
provide Lender with notice thereof in writing.
Section
4.07. Inspections;
Examination of Books and Records. Borrower shall permit any
authorized representative of Lender from time to time, upon reasonable notice to
Borrower, during normal business hours, to examine and copy records and books
of, and visit and inspect the properties of, Borrower, and to discuss the
affairs and finances of Borrower with any of Borrower's officers, directors,
employees and accountants.
Section
4.08. Payroll
Taxes. Borrower shall pay and discharge all withholding or
other payroll taxes including, without limitation, social security and federal
income taxes prior to the date on which penalties attach
thereto. Borrower shall indemnify, defend and hold Lender harmless
from any and all liabilities, claims, losses, penalties or fines for non-payment
of any such withholding or payroll taxes including, without limitation, any
liability arising under Section 3505 of the IRC, as amended from time to
time.
Section
4.09. Further
Assurances. Borrower shall duly execute and/or deliver (or
cause to be duly executed and/or delivered) to Lender any documents,
instruments, assignments, financing statements, waivers, consents or other
writings which may be reasonably necessary to Lender to carry out the terms of
this Agreement and any of the other Loan Documents.
Section
4.10. Litigation,
Default Conditions and Events of Default. Promptly, upon their
respective receipt of notice or knowledge thereof, Borrower will report to
Lender: (i) any lawsuit or administrative proceeding in which
Borrower or Guarantor is a defendant wherein the amount of damages claimed
against such Person exceeds Fifty Thousand Dollars ($50,000.00); or (ii) the
existence and nature of any Default Condition or Event of Default.
Section
4.11. Costs and
Expenses. Borrower will pay all costs and expenses required to
satisfy the conditions of this Agreement. Without limitation of the
generality of the foregoing, Borrower will pay: (a) all taxes and expenses,
including all intangible and stamp taxes, if any; (b) all fees and commissions
lawfully due to brokers in connection with this transaction; (c) legal fees and
expenses of Lender's counsel; and (d) all sales and/or use taxes imposed by any
appropriate Governmental Authority on any of the foregoing.
6
Section
4.12. Satisfaction
of Conditions. Borrower will cause all conditions hereof to be
satisfied to the extent it is within its power to do so.
Section
4.13. Indemnification. Borrower
agrees to protect, indemnify, defend, and hold harmless Lender and each of its
officers, affiliates, directors, employees, attorneys, accountants, consultants,
representatives and agents (collectively, "Indemnitees") from and against
any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, claims, costs, expenses and disbursements (including, without
limitation, payment by Lender of any obligations due or past due under any
contract or agreement to which Borrower is or becomes a party) of any kind or
nature whatsoever (including, without limitation, the fees and disbursements of
counsel for and consultants of such Indemnitees in connection with any
investigative, administrative or judicial proceeding, whether or not such
Indemnitees shall be designated a party thereto), which may be imposed on,
incurred by, or asserted against such Indemnitees (whether direct, indirect, or
consequential and whether based on any federal or state laws or other statutory
regulations, including, without limitation, securities, Environmental Laws and
commercial laws and regulations, under common law or cause at equity or on
contract or otherwise) in any manner relating to or arising out of this
Agreement or any of the other Loan Documents, or any act, event or transaction
related or attendant thereto, the agreements of Lender contained herein, the
closing of the Credit Facility, the management of the Credit Facility or the
Collateral (including any liability under any Environmental
Law) or the use or intended use of the proceeds of the Credit Facility hereunder
(collectively, the "Indemnified
Matters"); provided,
that Borrower shall not have any obligation to any Indemnitee hereunder with
respect to Indemnified Matters caused by or resulting from the willful
misconduct or gross negligence of such Indemnitee; provided,
further, that Borrower shall not have any obligation to any Indemnitee
hereunder with respect to taxes that are imposed on the net income of any
Indemnitee or any franchise or doing business taxes imposed on any
Indemnitee. To the extent that the undertaking to indemnify, pay and
hold harmless set forth in the preceding sentence may be unenforceable because
it is violative of any law or public policy, the Borrower shall contribute the
maximum portion which it is permitted to pay and satisfy under applicable law,
to the payment and satisfaction of all Indemnified Matters incurred by the
Indemnitees.
Section
4.14. Payment of
Documentary Stamp and Intangible Taxes. In addition to paying all
documentary stamp taxes and intangible taxes paid by Borrower as required by
Lender or law as of the date of this Agreement, if any, Borrower agrees to pay
in full, immediately on request by Lender, any and all other or additional
documentary stamp taxes and intangible personal property taxes, including
interest and penalties, that later are deemed by Lender or by the Florida
Department of Revenue to be applicable to this transaction, including any excise
taxes applicable to the Note or this Agreement. Further, Borrower
agrees to indemnify, defend and hold Lender harmless with respect to any such
excise taxes (and penalties, interest or fines with respect thereto) deemed to
be applicable.
Section
4.15. Right of
Set-Off. Upon the occurrence of any default of any agreement
between Borrower and Lender, Lender is authorized at any time, without notice to
Borrower, to set-off, off-set, appropriate and apply any and all of the property
described above against any indebtedness of Borrower.
Section
4.16. System of
Accounting. Borrower shall maintain a system of accounting
satisfactory to Lender and in substantial accordance with GAAP applied on a
Consistent Basis. All books and records of Borrower shall be
maintained at its Executive Office designated herein.
Section
4.17. Filings on
Time. Borrower shall make all future required SEC filings on a timely
basis and such filings shall be in compliance with all SEC rules and
regulations.
Section
4.18. Fiscal Year
End. Each of Borrower's Fiscal Years shall end on December
31st.
7
Section
4.19. Estoppel. Borrower,
within ten (10) days after written request from Lender, will furnish a written
statement in form satisfactory to Lender, duly acknowledged, (i) setting forth
the unpaid principal balance of, and interest and other sums due on, the Credit
Facility, (ii) stating whether or not any offsets or defenses exist against
payments due under the Loans, and (iii) stating whether there are then in
existence any Events of Default or Default Conditions known to
Borrower.
Section
4.20. Disposition of
Assets. Borrower will not sell,
lease, assign, transfer, or otherwise dispose of any of its assets, other than
(i) inventory in the ordinary course of business or (ii) furniture, fixtures and
equipment used or useable in the operation of Borrower’s business which are
replaced with items of reasonably equivalent or greater value in the ordinary
course of Borrower’s business consistent with past practices.
Section
4.21. Affiliate or
Subsidiary Transactions. Borrower shall not make nor permit
any Affiliate or Subsidiary to make any loan, advance or extension of credit to
any Person, nor shall Borrower purchase or otherwise acquire, or permit any
Affiliate or Subsidiary to purchase or acquire, any equity interest, assets,
obligations or other securities of, make any capital contribution to, or
otherwise invest in or acquire any interest in any Person, without Lender's
prior written consent, and other than accounts of account debtors to Borrower
incurred in the ordinary course of Borrower's business.
Section
4.22. Additional
Indebtedness. Borrower shall not incur
any additional Indebtedness other than as shown in the Company’s most recent
published financial statements or refinancings thereof, purchase money financing
for the acquisition of furniture, fixtures or equipment in the ordinary course
of Borrower’s business consistent with past practices, the Credit Facility or
trade payables incurred by Borrower in the ordinary course of its business or
subordinated indebtedness of Borrower which is fully subordinated to payment in
full of the Obligations and which provides that any payments thereon shall cease
upon the occurrence of an Event of Default, and is not secured by any assets of
Borrower, the terms of which subordinated indebtedness must in all respects be
acceptable to Lender or Permitted Liens.
Section
4.23. Insider
Transactions. Borrower shall not enter into any transaction,
agreement or undertaking with any Affiliate or Subsidiary on terms which are
less favorable to Borrower than those generally available in the market without
the prior written consent of Lender.
ARTICLE
5
EVENTS
OF DEFAULT
The
occurrence of any events or conditions described hereinbelow shall constitute an
"Event of Default"
hereunder, provided that any requirement for the giving of notice or the lapse
of time, or both, has been satisfied; time is of the essence
herein:
Section
5.01. Note. Borrower
shall fail to make any payment of principal or interest due under the Note when
due or within any curative period therefor provided in the Note.
Section
5.02. Obligations. Borrower
shall fail to make any payments of principal and/or interest on any of the
Obligations when due.
Section
5.03. Misrepresentations. Borrower
shall make any representation or warranty in this Agreement or in any of the
other Loan Documents or in any certificate or statement furnished at any time
hereunder or in connection with any of the Loan Documents which proves to have
been untrue or misleading in any material respect when made or
furnished.
Section
5.04. Covenants. Borrower
shall default in the observance or performance of any covenant or agreement
contained in this Agreement, or in any of the other Loan Documents.
Section
5.05. Other Loan
Documents. An Event of Default or default shall occur under any other
Loan Document.
8
Section
5.06. Other
Debts. Borrower shall default in connection with any agreement
for borrowed money or other credit with any creditor other than Lender which
entitles said creditor to accelerate the maturity thereof.
Section
5.07. Voluntary
Bankruptcy. Borrower
or any Guarantor (an "Obligated
Party") shall file a voluntary petition in bankruptcy or a voluntary
petition or answer seeking liquidation, reorganization, arrangement,
readjustment of its debts, or for any other relief under the Federal Bankruptcy
Code, or under any other act or law pertaining to insolvency or debtor relief,
whether state, Federal or foreign, now or hereafter existing; any Obligated
Party shall enter into any agreement indicating its consent to, approval of, or
acquiescence in, any such petition or proceeding; any Obligated Party shall
apply for or permit the appointment by consent or acquiescence of a receiver,
custodian or trustee of such Person or a substantial part of such Person's
property; any Obligated Party shall make an assignment for the benefit of
creditors; or any Obligated Party shall be unable or shall fail to pay its debts
generally as such debts become due; or any Obligated Party shall admit, in
writing, its inability or failure to pay its or their debts generally as such
debts become due.
Section
5.08. Involuntary
Bankruptcy. There shall have been filed against any Obligated
Party an involuntary petition in bankruptcy or seeking liquidation,
reorganization, arrangement, readjustment of its or their debts, or for any
other relief under the Federal Bankruptcy Code, or under any other act or law
pertaining to insolvency or debtor relief, whether state, Federal or foreign,
now or hereafter existing; any Obligated Party shall suffer or permit the
involuntary appointment of a receiver, custodian or trustee of such Person for
all or a substantial part of its property; any Obligated Party shall
suffer or permit the issuance of a warrant of attachment, execution or similar
process against all or any substantial part of the property of such Person; or
any Obligated Party who is a natural person shall become deceased or declared
legally incompetent.
Section
5.09. Deemed
Insecure. Lender, at any time and in good faith, shall deem
itself insecure and for the purposes of this Agreement, Lender shall be entitled
to deem itself insecure when some event occurs, fails to occur or is threatened
or some objective condition exists or is threatened which significantly impairs
the prospects that any of the Obligations will be paid when due, or which
significantly affects the financial or business condition of
Borrower.
ARTICLE
6
REMEDIES
Upon the
occurrence of any Default Condition or Event of Default, Lender's obligation to
extend financing under the Credit Facility shall cease. Upon the occurrence or
existence of any Event of Default, or at any time thereafter, without prejudice
to the rights of Lender to enforce its claims against Borrower for damages for
failure by Borrower to fulfill any of its obligations hereunder, subject only to
prior receipt by Lender of payment in full of all Obligations then outstanding
and in form acceptable to Lender, Lender in addition to all rights and remedies
which it may have at law or in equity, shall have the following rights and
remedies:
Section
6.01. Acceleration of the
Obligations. Lender, at its option, may declare all of the
Obligations (including but not limited to that portion thereof evidenced by the
Note) to be immediately due and payable, whereupon the same shall become
immediately due and payable without presentment, demand, protest, notice of
non-payment or any other notice required by law relative thereto, all of which
are hereby expressly waived by Borrower, anything contained herein to the
contrary notwithstanding and, in connection therewith, if Lender so elects, by
further written notice to Borrower, Lender may increase the rate of interest
charged on the Note then outstanding for so long thereafter as Lender further
shall elect by an amount not to exceed the Default Rate. If any note
of Borrower to Lender constituting the Obligations, including without limitation
the Note, shall be a demand instrument, however, the recitation of the right of
Lender to declare any and all Obligations to be immediately due and payable,
whether such recitation is contained in such note or in this Agreement, as well
as the recitation of the above events permitting Lender to declare all
Obligations due and payable, shall not constitute an election by Lender to waive
its right to demand payment under a demand at any time and in any event, as
Lender in its discretion may deem appropriate. Thereafter, Lender, at its
option, may but shall not be obligated to, accept less than the entire amount of
Obligations due, if tendered, provided,
however, that unless then agreed to in writing by Lender, no such
acceptance shall or shall be deemed to constitute a waiver of any Event of
Default or a reinstatement of any commitments of Lender
hereunder.
9
Section
6.02. Other
Remedies. Unless
and except to the extent expressly provided for to the contrary herein, the
rights of Lender specified herein shall be in addition to, and not in limitation
of, Lender's rights at law or in equity, or under any other provision of any
other Loan Documents or under the provisions of any other document, instrument
or other writing executed by Borrower or any third party in favor of Lender, all
of which may be exercised successively or concurrently.
ARTICLE
7
MISCELLANEOUS
Section
7.01. Remedies
Cumulative; Waiver. Each
and every right granted to Lender under this Agreement or any of the Loan
Documents, or any other document delivered hereunder or in connection herewith
or allowed it by law or in equity, shall be cumulative and may be exercised from
time to time. No failure on the part of Lender to exercise, and no
delay in exercising, any right shall operate as a waiver thereof, nor shall any
single or partial exercise by Lender of any right preclude any other or future
exercise thereof or the exercise of any other right. No advance under
the Credit Facility shall constitute a waiver of any of the provisions of this
Agreement. No waiver by Lender of any Default Condition or Event of
Default shall constitute a waiver of any subsequent Default Condition or Event
of Default.
Section
7.02. Survivability of
Representations, Warranties and Covenants. The representations
and warranties made in this Agreement shall be true and correct as of the date
hereof and shall remain true and correct in all material respects at all times
hereafter so long as any portion of the Obligations shall remain
outstanding. All representations, warranties and covenants made
herein are given as an inducement to Lender to extend credit to
Borrower. Lender is relying on the validity and accuracy of such
representations and warranties and the covenants made by Borrower as contained
herein. All representations, warranties and covenants made herein shall survive
the execution and delivery of all Loan Documents and shall further survive any
and all bankruptcy, reorganization, arrangement, liquidation, dissolution or
insolvency proceedings relating to Borrower or any guarantor.
Section
7.03. Notices. All
notices hereunder shall be in writing and shall be deemed to have been
sufficiently given or served for all purposes when presented personally or sent
by registered or certified mail, postage prepaid, to any party hereto at its
address set forth in the preamble to this Agreement.
Section
7.04. Modifications. Neither
this Agreement nor any provision hereof may be changed, waived, discharged or
terminated orally, but only by an instrument in writing, signed by the party
against whom enforcement of the change, waiver, discharge or termination is
sought.
Section
7.05. Cross
Default. A default by Borrower in this Agreement shall
constitute a default under the Note and all other Loan Documents, and a default
by Borrower under any of the Note or any other Loan Document shall constitute a
default under this Agreement.
Section
7.06. Usury. Notwithstanding
any provision herein or in any other Loan Document to the contrary, the total
liability of Borrower for any payments of interest or in the nature of interest
shall not exceed the limits (contract rights) imposed by the usury laws of the
State of Florida. In the event that any such payment is paid by Borrower, or
received by Lender, then such excess sum shall be credited as provided in the
Note for payments of interest or payments in the nature of
interest. Such return or credit shall not cure or waive any Default
Condition or Event of Default under this Agreement or any other Loan
Document.
10
Section
7.07. Gender and
Number. In this Agreement, whenever the context so requires,
the neuter gender includes the feminine and/or masculine, as the case may be and
the singular number includes the plural.
Section
7.08. Binding
Effect. The terms, conditions, covenants, agreements, powers,
privileges, notices and authorizations herein contained shall extend to, be
binding upon and available for the heirs, executors, administrators, successors
and, to the extent permitted hereunder, to the assigns of each of the respective
parties hereof. Notwithstanding the foregoing, Borrower will not
assign or transfer voluntarily or by operation of law, or otherwise dispose of
this Agreement or any monies, property or funds deposited with
Lender. An assignment or transfer in violation of this provision
shall be invalid, and an assignment or transfer by operation of law shall be
deemed to be an invalid transfer.
Section
7.09. Time of
Essence. It is specifically agreed that in all cases, time is
of the essence of this Agreement.
Section
7.10. Assignment by
Lender. Lender
may at any time, and from time to time, as it may deem appropriate, assign in
whole or in part, or issue participation interests in and to all of its rights
and interests under this Agreement, the Note, and any other Loan Documents. In
such event, this Agreement shall continue to apply to the Credit Facility, the
Note, and Loan Documents. In the event of such assignment, it shall
be deemed to have been made pursuant to the terms of this Agreement and not to
be in modification hereof and advances made by any such assignee shall be
evidenced and secured by the Note and other Loan Documents. Borrower
acknowledges that any payments made by it in partial or complete discharge of
the Credit Facility to any agent other than the owner and holder of the Loan
Documents and Note of record shall constitute a payment of Borrower's agent and
not to the owner and holder of the Note or its agents; such payment shall be
deemed not to have been properly made, and Lender shall not be required to
release or discharge the Loan Documents, the Note, or any of the Collateral in
satisfaction of the Obligation pursuant to the provisions of the Loan Documents
and the Note.
Section
7.11. Assignment by
Borrower. This Agreement may not be assigned by Borrower
without the prior written consent of Lender. In the event that Lender
approves any such assignment, Lender shall be entitled to make advances to such
assignee and such advances shall be evidenced by the Note and the other Loan
Documents. Borrower shall remain liable for payment of all sums
advanced hereunder before and after such assignment.
Section
7.12. Severance. In the
event any one or more of the provisions or terms of this Agreement shall for any
reason be held to be unenforceable in any respect, such unenforceability shall
not affect any other provisions of this Agreement, but this Agreement shall be
construed as if such unenforceable provision had never been contained
herein.
Section
7.13. Claims Against
Lender. No action shall be commenced by Borrower for any claim
against Lender under the terms of this Agreement unless written notice thereof,
specifically setting forth Borrower's claim, shall have been given to Lender
within fifteen (15) days after the occurrence of the event or omission which
Borrower alleges gave rise to any such claim, and failure to give such notice
shall constitute a waiver of any such claim. The liability of Lender
to Borrower for any breach of the terms of this Agreement by Lender shall not
exceed a sum equal to the amount which Lender shall have failed to advance in
consequence of a breach by Lender of its obligations under this Agreement and,
upon the making of any such payment by Lender to Borrower, the same shall be
treated as an advance under this Agreement in the same fashion as any other
advance under the terms of this Agreement.
Section
7.14. Headings. Any
captions or headings of the articles, sections and subsections of this Agreement
are for convenience and reference and are not to be considered a part hereof and
shall not limit or otherwise affect any of the provisions or terms
hereof.
Section
7.15. Interpretation. No
provision of this Agreement shall be construed against or interpreted to the
disadvantage of any party hereto by any court or other governmental or judicial
authority by reason of such person having or being deemed to have structured or
dictated such provision.
11
Section
7.16. Counterparts. This
Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument and any of the parties or
signatories hereto may execute this Agreement by signing any such
counterpart.
Section
7.17. Governing
Law. This Agreement and each transaction consummated hereunder
shall be deemed to be made under the laws of the State of Florida, excepting,
however, its laws or rule regarding conflicts of laws or choice of laws,
and shall be construed in accordance with and governed by the laws of such
state.
Section
7.18. Acceptance. This
Agreement, together with the other Loan Documents, shall not become effective
and until delivered to Lender and accepted in writing by Lender, as evidenced by
its execution hereof (notice of which delivery and acceptance are hereby waived
by Borrower).
Section
7.19. Cure of Defaults by
Lender. If, hereafter, Borrower defaults in the performance of
any duty or obligation to Lender hereunder, Lender may, at its option, but
without obligation, cure such default and any cost, fees and expenses incurred
by Lender in connection therewith including, without limitation, for the
purchase of insurance, the payment of taxes and the removal or settlement of
liens and claims, shall be added to the indebtedness evidenced by the Note and
shall bear interest at the Default Rate.
Section
7.20. Sole
Benefit. The rights and benefits set forth in this Agreement
and in all the other Loan Documents are for the sole and exclusive benefit of
the parties thereto and may be relied upon only by them.
Section
7.21. Meaning of
Particular Words. Any reference herein to "attorneys' fees" or
"attorney's fees" shall be deemed to also include hourly charges for paralegals,
law clerks and other staff members operating under the supervision of an
attorney. Any award or payment of attorneys' fees shall also include
any and all sales and/or use taxes imposed thereon by any appropriate
governmental authority.
Section
7.22. Execution Under
Seal. This Agreement is being executed under seal by
Borrower.
Section
7.23. Notice of Final
Agreement. THIS WRITTEN AGREEMENT AND ANY OTHER DOCUMENTS EXECUTED IN
CONNECTION HEREWITH REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES.
[Remainder
of Page Intentionally Blank]
12
IN WITNESS WHEREOF, the parties
hereto have caused this Agreement to be executed and delivered as of
the date first above written.
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"Lender"
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THE XXXXX FAMILY LIMITED
PARTNERSHIP, a Texas Limited Partnership
|
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By:
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Xxxxxxxxx
X. Xxxxx, Managing General Partner
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"Borrower"
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ORAGENICS, INC., Florida
Corporation
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By:
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Xxxxx
Xxxxxx, President and Chief Executive
Officer
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13
