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Exhibit 16
AMENDED AND RESTATED
GRID NOTE WITH LIBOR PRICING
New York, New York
$7,000,000 As of August 19, 1997
WHEREAS, on December 5, 1996, a Grid Note with Libor Pricing in the
principal amount of $7,000,000 (the "Original Note") was entered into between
Republic National Bank of New York ("Bank") and Xxxxxxxxxx Associates, L.P.
("XXXX I").
WHEREAS, on August 18, 1997 and August 19, 1997, XXXX I and Xxxxxxxxxx
Associates II L.P. ("XXXX II") entered into an Assignment and Assumption
Agreement (collectively, the "Agreements") providing for the transfer by XXXX I
of all of its assets to XXXX II and the assumptions by XXXX II of the
obligations and liabilities of XXXX I, including without limitation under the
Original Note and the Continuing General Security Agreement dated December 5,
1996 between XXXX I and the Bank.
NOW THEREFORE, to reflect changes to the terms and conditions of the
Original Note agreed to between XXXX II and the Bank, the undersigned and the
Bank agree to amend and restate the Original Note in its entirety as follows:
FOR VALUE RECEIVED, the undersigned ("Maker") promises to pay to the
order of REPUBLIC NATIONAL BANK OF NEW YORK ("Bank") at its principal banking
office at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or at any of its other
banking offices in New York as Bank may designate by written notice to Maker,
the sum of SEVEN MILLION DOLLARS, or so much thereof as shall be advanced by
Bank to Maker, in Bank's sole discretion, in one or more loans (each an
"Advance" and collectively the "Advances") and not repaid, on August 31, 1998
(the "Maturity Date"), or with respect to each Advance on the Due Date (as
defined below) of such Advance, whichever first occurs, and to pay interest on
each Advance from the date of such Advance until the date on which such Advance
is paid in full, at the rate and in the manner provided below.
Each Advance shall be due on a date (the "Due Date") one or more months
from the date of such Advance (the "Term") and have an Interest Period (as
defined below) as specified in writing by the Maker in the Maker's request (the
"Request") for such Advance. In no event shall any Term for any Advance end
later than the Maturity Date. Provided that no Event of Default (as defined
below) has occurred and is continuing, Maker may make a written request upon
Bank (the "Extension Request") to extend the maturity date of an Advance beyond
its original Term or the then current additional Term, as the case may be, for
an additional Term, to commence on the expiration of the original Term or the
then current additional Term, as the case may be, and end on or prior to the
Maturity Date, and have an Interest Period, as specified
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by Maker in the Extension Request. Bank must receive the Extension Request at
least seven Business Days prior to the expiration of the original Term or the
then current additional Term, as the case may be, of said Advance and shall
decide in its sole discretion, for no reason or for any reason whatsoever,
whether to agree to the requested extension. If Maker does not receive written
notice from Bank at least three Business Days prior to the expiration of the
original Term for such Advance that Bank has agreed to the Extension Request,
then such Advance will continue to be due and payable on the last day of the
original Term or the then current additional Term, as the case may be. In any
event, interest on such Advance shall continue to be due and payable as set
forth herein regardless of whether Bank agrees to the Extension Request.
Prior to the occurrence of any Event of Default, each Advance shall
bear interest during its Term at a rate (the "Contract Rate") equal to 2% per
annum above LIBOR (as defined below) for each Interest Period applicable to such
Advance, each adjustment to take effect on the first day of each Interest Period
applicable to such Advance.
Interest on each Advance will be due and payable on the last day of
each month and on the last day of each Interest Period and on payment in full of
such Advance. After the occurrence of an Event of Default, interest under this
Note on each Advance shall be payable on demand and shall accrue on each Advance
at a rate per annum equal to 2% per annum above the Contract Rate otherwise
chargeable on such Advance hereunder. Interest shall be calculated on the basis
of a 360-day year for actual days elapsed. In no event shall the interest rate
applicable at any time to this Note exceed the maximum rate permitted by law.
For purposes hereof, the term "Interest Period" shall mean for each
Advance, each consecutive one, two, three or six month period, as specified by
Maker in the Request for such Advance. The first Interest Period in respect of
an Advance shall commence on the date of such Advance and each successive
Interest Period in respect of such Advance shall commence immediately at the end
of the preceding Interest Period. Maker must specify an Interest Period for each
Advance such that the Term for each Advance must be equal to or an integral
multiple of the specified Interest Period for such Advance.
As used herein, "LIBOR" means with respect to an Advance the rate per
annum, rounded upward to the nearest 1/8th of 1%, quoted at approximately 11:00
A.M. London time, two Business Days (as defined below) prior to the first day of
each successive Interest Period by Bank's principal branch in London, England,
for offering to leading banks in the London Interbank Market for United States
Dollar deposits in an amount comparable to the principal amount of such Advance
for a period equal to the Interest Period applicable to such Advance.
If Bank determines, in its sole discretion, during the term of this
Note, that (A) by reason of circumstances affecting the London Interbank Market
generally, adequate and fair means do not exist for ascertaining an applicable
LIBOR or it is impractical for Bank to continue to fund any Advance during an
applicable Interest Period, or (B) quotes for funds in United States Dollars
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in sufficient amounts comparable to any Advance and for the duration of the
applicable Interest Period for such Advance would not be available to Bank in
the London Interbank Market, or (C) quotes for funds in United States Dollars in
the London Interbank Market will not accurately reflect the cost to Bank of
funding any Advance during an applicable Interest Period, or (D) the making or
funding of loans, or charging of interest at rates, based on LIBOR shall be
unlawful or unenforceable for any reason, then as long as such circumstance(s)
shall continue, any such Advance shall bear interest at a variable rate equal to
the Reference Rate (as defined below) and such rate shall be the Contract Rate
for all other purposes hereof. As used herein, "Reference Rate" means the rate
established by Bank from time to time at its principal domestic office as its
reference rate for domestic commercial loans. Bank may make loans to customers
above, at or below the Reference Rate. Any change in the Reference Rate shall
become effective on the date of such change.
This Note evidences Advances made by Bank to Maker from time to time.
The Bank agrees to make Advances to Maker prior to the Maturity Date and
provided that (a) no Event of Default (as hereinafter defined) has occurred and
(b) no Margin Shortfall (as defined in the Amended Margin Agreement dated as of
August 19, 1997 and executed and delivered by the Maker to the Bank as a rider
to the Continuing General Security Agreement dated December 5, 1996 from
Xxxxxxxxxx Associates L.P. in favor of the Bank and any amendments, restatements
or modifications thereto) has occurred and is continuing at the time an Advance
hereunder is requested by the Maker.
The unpaid principal balance of this Note at any time shall be the
total of all Advances made by Bank to Maker in Bank's sole discretion, less the
total amount of principal payments made hereon by Maker. The date, the amount of
each such Advance, the Due Date and applicable Contract Rate as adjusted as set
forth above for each such Advance, any extensions of an Advance as agreed to by
Bank as set forth herein and in its sole discretion, and each payment on account
of principal thereof shall be recorded by Bank on its books and records, and
when so recorded shall represent evidence thereof binding upon Maker in the
absence of manifest error.
Each payment to be made hereunder shall be free and clear of, and
without deductions for or on account of any present or future taxes, imposts,
charges, levies, compulsory loans or other withholdings or deductions
whatsoever. If the Maker shall be required by applicable law to make any such
deduction from any payment hereunder, (i) the sum payable shall be increased as
may be necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this paragraph) the Bank
receives an amount equal to the sum it would have received had no deductions
been made, (ii) the Maker shall make such deductions, and (iii) the Maker shall
pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law. In addition, the Maker agrees to
pay, if necessary, all stamp, documentary, or similar taxes or any other excise
or property taxes, charges or similar levies which arise from any payment made
hereunder or from the execution, delivery or registration of, or otherwise with
respect to, this instrument.
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To induce Bank, in its sole discretion, to make Advances to Maker,
Maker represents, warrants and covenants to Bank that (i) Maker is a limited
partnership which is duly formed and validly existing in good standing under the
laws of the jurisdiction of its formation, with full power and authority to
make, deliver and perform this Note; (ii) the execution, delivery and
performance by Maker of this Note have been duly authorized, by all necessary
action, and does not and will not violate or conflict with, its partnership
agreement, or in any case, any law, rule, regulation or order binding on Maker
or any agreement or instrument to which Maker is a party or which may be binding
on Maker; (iii) this Note has been fully executed by the general partner of
Maker and, in any case, constitutes a legal, valid, binding and enforceable
obligation of Maker; (iv) no authorization, consent, approval, license,
exemption of or filing or registration with, any court or government or
governmental agency is or will be necessary to the valid execution, delivery or
performance by Maker of this Note; (v) the Advances evidenced by this Note will
be used for general business purposes and investments; and (vi) there are no
pending or threatened actions, suits or proceedings against or affecting maker
by or before any court, commission, bureau or other governmental agency or
instrumentality, which, individually or in the aggregate, if determined
adversely to Maker, would have a material adverse effect on the business,
properties, operations, or condition, financial or otherwise, or Maker.
Requests for Advances to Maker from Bank and directions as to the
deposition of the proceeds thereof must be given in writing to Bank by the
general partner of Maker or other persons authorized to borrow on Maker's behalf
by borrowing authority and certification of Maker's general partner heretofore
delivered to Bank, as such authority may be amended or superseded from time to
time, provided that any such amending or superseding authority shall have been
certified by an authorized signatory of Maker's general partner, and a copy
thereof, so certified by the authorized signatory of Maker's general partner
shall have been delivered to an officer of Bank at its office for payment. Bank
may conclusively rely on the authorities contained in said resolutions. Any such
Advance so made shall be conclusively presumed to have been made to or for the
benefit of Maker and Maker shall be liable in respect thereof when made in
accordance with any such request or direction, or when deposited to any account
of Maker with Bank, even though persons other than those authorized to borrow on
behalf of Maker may have authority to draw against such account. Bank may rely
on any such request or direction which it believes to be genuine, and Bank shall
be fully protected in so doing without any duty to make further inquiry as to
such genuineness or in otherwise acting in good faith in the premises. By making
a request for an Advance, Maker shall be deemed to be representing to Bank that
all of the representations and warranties of Maker set forth in this Note are
true and correct as of the date of such request as if made on and as of such
date and shall also be deemed to be representing and warranting to Bank that on
such date Maker is not in breach of any of its covenants to Bank set forth in
this Note or in any other document or instruments of Maker to Bank and no event
of default has occurred and is continuing with respect to any Obligations (as
defined below).
This Note shall be payable in lawful money of the United States of
America ("United States Dollars") in immediately available funds. All payments
on this Note shall be
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applied to the payment of accrued interest before being applied to the payment
of principal. Any payment which is required to be made on a day which is not a
Business Day (as defined below) shall be payable on the next succeeding Business
Day and such additional time shall be included in the computation of interest.
In the event that any other Obligations of Maker to Bank are due at any time
that Bank receives a payment from Maker on account of this Note or any such
other Obligations of Maker, Bank may apply such payment to amounts due under
this Note or any such other Obligations in such manner as Bank, in its sole
discretion, elects, regardless of any instructions from Maker to the contrary.
As used herein, "Business Day" shall mean a day on which (A) banks are regularly
open for business in both London and New York City and (B) Bank's principal
banking office at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx shall be open for
ordinary business.
Maker shall be entitled to prepay any Advances in whole but not in part
without penalty or the prior consent of Bank before 11:00 A.M. New York City
time on the last day of any Interest Period (or the next succeeding Business Day
if the last day of such Interest Period is not a Business Day, referred to
herein as a "Prepayment Date") for such Advance together with the payment of all
interest accrued and unpaid on such Advance to the date of such prepayment
provided that Bank has received written notice from Maker, at least seven
Business Days prior to such Prepayment Date, informing Bank that such prepayment
will be made on such Prepayment Date. Maker also shall be entitled to prepay any
Advance in whole but not in part before 11:00 A.M. New York City time on any
Business Day which is not the last day of an Interest Period without the prior
consent of, or any prior notice to, Bank provided that any such prepayment shall
be made together with (i) the payment of all interest accrued and unpaid on the
prepaid Advance to the date of prepayment and (ii) the payment of the Liquidated
Cost (as defined below). As used herein, "Liquidated Cost" means, with respect
to any prepayment, an amount necessary to compensate Bank for the cost of
reinvesting, for the period commencing on the date of the prepayment and
extending to the last day of the then current Interest Period of such prepaid
Advance, the prepaid principal amount received by Bank at a rate or rates which
may be less than the Contract Rate for such prepaid Advance. Maker and Bank
acknowledge that determining the actual amount of the Liquidated Cost may be
difficult or impossible in any specific instance and accordingly Maker agrees
with Bank that the Liquidated Cost shall equal the excess, if any, of (i) the
product of (A) the amount of principal prepaid, multiplied by (B) the Contract
Rate applicable to such Advance which is being prepaid, divided by 360,
multiplied by (C) the remaining number of days from the date of the prepayment
to the end of the then current Interest Period of the Advance which is being
prepaid, over (ii) that amount of interest which Bank determines that the holder
of a Treasury Obligation (as defined below) selected by Bank in the amount (or
as close to such amount as is feasible) of such prepaid Advance and having a
maturity date on the last day of the stated term of such prepaid Advance (or as
soon thereafter as is feasible), would earn if that Treasury Obligation were
purchased in the secondary market on the date of the prepayment and were held to
the last day of the then current Interest Period of such prepaid Advance. Xxxxx
agrees that the determination of Liquidated Cost shall be based on amounts which
a holder of a Treasury Obligation could receive under these circumstances,
whether or not Bank actually invests
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the prepaid principal amount in any Treasury Obligation. As used herein,
"Treasury Obligation" means a note, bill or bond issued by the United States
Treasury Department as a full faith and credit general obligation of the United
States. Maker agrees that the payment of Liquidated Cost as a premium in
connection with any prepayment is reasonable to compensate Bank for lost income
resulting from such prepayment because Maker is receiving the benefit of having
the Contract Rate priced based on LIBOR.
If any law, regulation, directive or treaty or any change therein or in
the interpretation or application thereof shall make it unlawful for Bank to
maintain the Advances evidenced by this Note or to claim or receive any amount
otherwise payable under this Note, Bank shall so notify Maker. In the case of
any such notice, Maker shall prepay the outstanding principal amount of this
Note in full together with all accrued interest on such earlier date prior to
the respective Due Dates as Bank may specify and on which Bank may lawfully
receive such payment, if payment on such earlier date is reasonably required as
a result of such impending illegality.
If, after the date of this Note, the adoption of any applicable law,
ordinance, regulation or rule (a "Governmental Rule"), any change in any
applicable Governmental Rule, any change in the interpretation or administration
of any applicable Governmental Rule by any person charged with the
interpretation or administration thereof, or compliance by Bank with any request
or directive (whether or not having the force of law) of any such person
(a) shall subject Bank to any tax, duty or other charge with
respect to all or any portion of the Advances or shall change
the basis of taxation of payments to Bank of any amounts due
under this Note (except for changes in the rate of tax on the
overall net income of Bank or any of its offices imposed by
the tax laws of any jurisdiction in the world); or
(b) shall impose, modify or deem applicable any reserve
(including, without limitation, any imposed by the Board of
Governors of the Federal Reserve System), special deposit,
capital adequacy requirement, capital equivalency, ratio of
assets to liabilities or any other capital substitute or
similar requirement against assets of, deposits with or for
the account of, credit extended by, letters of credit issued
and maintained by, or collateral subject to a lien in favor of
the Bank, or shall impose on Bank any other condition
affecting all or any portion of the Advances,
and the result of any of the foregoing is to increase the cost to or to impose a
cost on Bank of making or maintaining all or any portion of the Advances, or to
reduce the amount of any sum received or receivable by Bank under this Note, or
(in the case of a capital adequacy or similar requirement) to reduce the rate of
return on Bank's capital as a consequence of maintaining all or any portion of
the Advances to a level below that which could have been achieved but for the
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imposition of such requirement (taking into consideration Bank's capital
adequacy policies), then, within 30 days after demand by Bank, Maker shall pay
Bank for its own account such additional amount or amounts as will compensate
Bank for such increased cost or reduction. Bank will promptly notify Maker of
any event of which it has knowledge, occurring after the date of this Note,
which will entitle Bank to compensation pursuant to this paragraph. A
certificate of Bank claiming compensation for itself under this paragraph and
setting forth in reasonable detail the additional amount or amounts to be paid
to Bank shall be conclusive evidence of the amount of such compensation absent
manifest error. In determining such amount, Bank may use any reasonable
averaging and attribution methods.
Upon the occurrence of any of the following (each, an "Event of
Default") with respect to any Maker, general partner of Maker, indorser of the
indebtedness evidenced by this Note or Xxxxx X. Xxxxxxxxxx: (i) default in
payment of any amount due (whether at stated maturity, by acceleration, by
notice from Maker as to a prepayment or otherwise) under this Note or in the
payment or performance of any other Obligation or agreement of any nature or
description to or with Bank; (ii) any of them shall commence any case,
proceeding or other action under any law relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to any of them, or seeking to adjudicate any of them a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to any of
them or any of their debts, or seeking appointment of a receiver, trustee,
custodian or other similar official for any of them or for all or any
substantial part of the assets of any of them, or any of them shall make a
general assignment for the benefit of its creditors, or there shall be commenced
against any of them any case, proceeding or other action of a nature referred to
in this clause (ii), or there shall be commenced against any of them any case,
proceeding or other action seeking issuance of a warrant of attachment,
execution, distraint or similar process against all or any substantial part of
the assets of any of them which results in the entry of an order for any such
relief, or any of them shall take any action in furtherance of, or indicating
its consent to, approval of, or acquiescence in, any of the acts set forth in
this clause (ii), or any of them shall generally not, or shall be unable to, or
shall admit in writing its inability to, pay its debts as they become due; (iii)
entry of a judgment against any of them not paid within 30 days or appealed in
good faith; (iv) failure to pay or remit any tax when assessed or due in excess
of $100,000 (other than taxes contested in good faith); (v) death or
dissolution; (vi) making a bulk transfer or sending notice of intent to do so;
(vii) granting any security interest (other than to Bank); (viii) suspension or
liquidation of the usual business; (ix) failing to furnish Bank with any
requested financial information or failing to permit inspection of books or
records by Bank or any of its agents, attorneys or accountants; (x) making any
misrepresentation to Bank material to the Bank's credit decision; (xi)
impairment of financial responsibility of any of them in Bank's good faith
opinion; (xii) Bank shall in good xxxxx xxxx itself insecure at any time; (xiii)
the Bank receives notice of the termination of any guarantee of Xxxxx X.
Xxxxxxxxxx relating to the indebtedness evidenced by this Note; or (xiv) the
occurrence of a default or event of default under any security agreement
securing any Obligations of Maker; then, in the case of any Event of Default
other than those referred to in
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clause (ii) of this sentence, Bank may declare by notice to Maker any and all
Obligations of Maker (including, without limitation, all Liquidated Costs
relating to such Obligations) to be immediately due and payable, and in case of
any Event of Default referred to in clause (ii) of this sentence all of the
Obligations of Maker (including, without limitation, all Liquidated Costs
relating to such Obligations) shall automatically become due and payable
immediately without notice or demand.
Bank shall have a continuing lien and/or right of set-off on, and is
hereby granted a security interest in, all deposits (general and special) and
credits with Bank or any Bank Affiliate of any Maker and indorser, and may apply
all or part of the same to any Obligations (whether contingent or unmatured) of
Maker, at any time or times, without notice. Bank shall have a continuing lien
on, and is hereby granted a security interest in, all property of every Maker
and indorser and the proceeds thereof held or received by or for Bank or any
Bank Affiliate for any purpose, whether or not for the express purpose of
serving as collateral security for the Obligations of Maker. As used in this
Note, the term "Bank Affiliate" includes any individual, partnership or
corporation acting as nominee or agent for Bank, and any corporation or bank
which is directly or indirectly owned or controlled by, or under common control
with, Bank. Any notice of disposition of property shall be deemed reasonable if
mailed at least five days before such disposition to the last address of Maker
or indorser on Bank's records. If the Obligations of Maker to Bank evidenced by
this Note are secured by a security agreement and/or other security documents
which Maker has separately delivered to Bank (whether or not such documents make
specific reference to this Note), reference to such documents is made for a
description of the collateral provided thereby and of the rights of Maker and
Bank therein. The rights and remedies of Bank provided for hereunder (including
but not limited to the right to accelerate Obligations of Maker and to realize
on any security for any such Obligations) are cumulative with the rights and
remedies of Bank available under any other instrument or agreement or under
applicable law. As used in this Note, the term "Obligations" of a person means
all amounts payable under this Note and any and all other indebtedness,
obligations and liabilities of that person to Bank, and all claims of Bank
against such person, now existing or hereafter arising, direct or indirect
(including participations or any interest of Bank in indebtedness of such person
to others), acquired outright, conditionally, or as collateral security from
another, absolute or contingent, joint or several, secured or unsecured, matured
or unmatured, monetary or non-monetary, arising out of contract or tort,
liquidated or unliquidated, arising by operation of law or otherwise, and all
extensions, renewals, refundings, replacements and modifications of any of the
foregoing. "Person" means any individual, partnership, limited partnership,
corporation, association, trust or other entity.
In the case of the occurrence of an Event of Default, each Maker and
indorser shall be jointly and severally liable for all costs of enforcement and
collection of this Note incurred by Bank or any other holder of this Note,
including but not limited to reasonable attorneys' fees, disbursements and court
costs. In addition, in the event of a default hereunder, Maker shall pay all
reasonable attorneys' fees and disbursements incurred by Bank in obtaining
advice as to its rights and remedies in connection with such default.
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Maker and each indorser hereby separately waive presentment, demand for
payment, notice of dishonor, protest and notice of protest, and any or all other
notices or demands in connection with the delivery, acceptance, performance,
default, endorsement or guarantee of this Note. The liability of any Maker or
indorser hereunder shall be unconditional and shall not be in any manner
affected by any indulgence whatsoever granted or consented to by the holder
hereof, including but not limited to any extension of time, renewal, waiver or
other modification. Any failure of the holder 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 and from time to time thereafter. Bank or any holder may
accept late payments, or partial payments, even though marked "payment in full"
or containing words of similar import or other conditions, without waiving any
of its rights. No amendment, modification or waiver of any provision of this
Note nor consent to any departure by Maker therefrom shall be effective,
irrespective of any course of dealing, unless the same shall be in writing and
signed by Bank, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given. This Note cannot
be changed or terminated orally or by estoppel or waiver or by any alleged oral
modification regardless of any claimed partial performance referable thereto.
Any notice from Bank to Maker or any indorser shall be deemed given
when delivered to Maker or such indorser by hand or when deposited in the United
States mail and addressed to Maker or such indorser at the last address of Maker
or such indorser appearing on Bank's records.
This Note shall be governed by and construed in accordance with the
laws of the State of New York applicable to instruments made and to be performed
wholly within that state. If any provision of this Note is held to be illegal or
unenforceable for any reason whatsoever, such illegality or unenforceability
shall not affect the validity of any other provision hereof.
MAKER AND EACH INDORSER AGREE THAT ANY ACTION, DISPUTE, PROCEEDING,
CLAIM OR CONTROVERSY BETWEEN MAKER OR SUCH INDORSER AND BANK, WHETHER SOUNDING
IN CONTRACT, TORT OR OTHERWISE ("DISPUTE" OR "DISPUTES") SHALL, AT BANK'S
ELECTION, WHICH ELECTION MAY BE MADE AT ANY TIME PRIOR TO THE COMMENCEMENT OF A
JUDICIAL PROCEEDING BY BANK, OR IN THE EVENT OF A JUDICIAL PROCEEDING INSTITUTED
BY MAKER OR SUCH INDORSER AT ANY TIME PRIOR TO THE LAST DAY TO ANSWER AND/OR
RESPOND TO A SUMMONS AND/OR COMPLAINT MADE BY MAKER OR SUCH INDORSER, BE
RESOLVED BY ARBITRATION IN ACCORDANCE WITH THE PROVISIONS OF THIS PARAGRAPH AND
SHALL, AT THE ELECTION OF BANK, INCLUDE ALL DISPUTES ARISING OUT OF OR IN
CONNECTION WITH (1) THIS NOTE OR ANY RELATED AGREEMENTS OR INSTRUMENTS, (2) ALL
PAST, PRESENT AND FUTURE AGREEMENTS INVOLVING MAKER OR SUCH INDORSER AND BANK,
(3) ANY TRANSACTION RELATED TO THIS NOTE AND ALL PAST, PRESENT AND FUTURE
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TRANSACTIONS INVOLVING MAKER OR SUCH INDORSER AND BANK, AND (4) ANY ASPECT OF
THE PAST, PRESENT OR FUTURE RELATIONSHIP OF MAKER OR SUCH INDORSER AND BANK.
Bank may elect to require arbitration of any Dispute with Maker or any indorser
without thereby being required to arbitrate all Disputes between Bank and Maker
or such indorser. Any such Dispute shall be resolved by binding arbitration in
accordance with Article 75 of the New York Civil Practice Law and Rules and the
Commercial Arbitration Rules of the American Arbitration Association ("AAA"). In
the event of any inconsistency between such Rules and these arbitration
provisions, these provisions shall supersede such Rules. All statutes of
limitations which would otherwise be applicable shall apply to any arbitration
proceeding under this paragraph. In any arbitration proceeding subject to this
paragraph, the arbitration panel (the "arbitrator") is specifically empowered to
decide (by documents only, or with a hearing, at the arbitrator's sole
discretion) pre-hearing motions which are substantially similar to pre-hearing
motions to dismiss and motions for summary adjudication. In any such arbitration
proceeding, the arbitrator shall not have the power or authority to award
punitive damages to any party. Judgment upon the award rendered may be entered
in any court having jurisdiction. Whenever an arbitration is required, the
parties shall select an arbitrator in the manner provided in this paragraph. No
provision of, nor the exercise of any rights under, this paragraph shall limit
the right of Bank (1) to foreclose against any real or personal property
collateral through judicial foreclosure, by the exercise of the power of sale
under a deed of trust, mortgage or other security agreement or instrument,
pursuant to applicable provisions of the Uniform Commercial Code, or otherwise
herein pursuant to applicable law, (2) to exercise self-help remedies including
but not limited to setoff and repossession, or (3) to request and obtain from a
court having jurisdiction before, during or after the pendency of any
arbitration, provisional or ancillary remedies and relief including but not
limited to injunctive or mandatory relief or the appointment of a receiver. The
institution and maintenance of an action or judicial proceeding for, or pursuit
of, provisional or ancillary remedies or exercise of self-help remedies shall
not constitute a waiver of the right of Bank, even if Bank is the plaintiff, to
submit the Dispute to arbitration if Bank would otherwise have such right.
Whenever an arbitration is required under this paragraph, the arbitrator shall
be selected, except as otherwise herein provided, in accordance with the
Commercial Arbitration Rules of the AAA. A single arbitrator shall decide any
claim of $100,000 or less and he or she shall be an attorney with at least five
years' experience. Where the claim of any party exceeds $100,000, the Dispute
shall be decided by a majority of three arbitrators, at least two of whom shall
be attorneys (at least one of whom shall have not less than five years'
experience representing commercial banks). The arbitrator shall have the power
to award recovery of all costs and fees (including attorneys' fees,
administrative fees, arbitrator's fees, and court costs) to the prevailing
party. In the event of any Dispute governed by this paragraph, each of the
parties shall, subject to the award of the arbitrator, pay an equal share of the
arbitrator's fees.
MAKER AND EACH INDORSER AGREE THAT ANY ACTION, SUIT OR PROCEEDING IN
RESPECT OF OR ARISING OUT OF THIS NOTE MAY BE INITIATED AND PROSECUTED IN THE
STATE OR FEDERAL COURTS, AS THE
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CASE MAY BE, LOCATED IN NEW YORK COUNTY, NEW YORK AND ANY ARBITRATION PROCEEDING
PURSUANT HERETO SHALL BE CONDUCTED IN NEW YORK, NEW YORK. MAKER AND EACH
INDORSER CONSENT TO AND SUBMIT TO THE EXERCISE OF JURISDICTION OVER ITS PERSON
BY ANY SUCH COURT HAVING JURISDICTION OVER THE SUBJECT MATTER, WAIVE PERSONAL
SERVICE OF ANY AND ALL PROCESS UPON IT AND CONSENT THAT ALL SUCH SERVICE OF
PROCESS BE MADE BY REGISTERED MAIL DIRECTED TO MAKER OR SUCH INDORSER AT ITS
ADDRESS SET FORTH BELOW OR TO ANY OTHER ADDRESS AS MAY APPEAR IN BANK'S RECORDS
AS THE ADDRESS OF MAKER OR SUCH INDORSER. MAKER AGREES THAT A FINAL JUDGMENT IN
ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
IN ANY ACTION, SUIT OR PROCEEDING IN RESPECT OF OR ARISING OUT OF THIS
NOTE, MAKER AND EACH INDORSER WAIVE (I) THE RIGHT TO INTERPOSE ANY SET-OFF OR
COUNTERCLAIM OF ANY NATURE OR DESCRIPTION, (II) ANY OBJECTION BASED ON FORUM NON
CONVENIENS OR VENUE AND (III) ANY CLAIM FOR CONSEQUENTIAL, PUNITIVE OR SPECIAL
DAMAGES.
TO THE EXTENT THAT MAKER OR ANY INDORSER HAS OR HEREAFTER ACQUIRES ANY
IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER FROM
SERVICE OF NOTICE, ATTACHMENT IN AID OF EXECUTION, ATTACHMENT PRIOR TO JUDGMENT,
EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, MAKER AND EACH
INDORSER IRREVOCABLY WAIVE SUCH IMMUNITY IN RESPECT OF THEIR OBLIGATIONS UNDER
THIS NOTE.
IN ANY ACTION, SUIT OR PROCEEDING IN RESPECT OF OR ARISING OUT OF THIS
NOTE, BANK, MAKER AND EACH INDORSER WAIVE TRIAL BY JURY.
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Bank is authorized to fill in any blank spaces and to otherwise
complete this Note and correct any patent errors herein.
Xxxxxxxxxx Associates II L.P.
By: Xxxxxxxxxx Partners II LLC,
its General Partner
/s/ Xxxxxx X. Xxxxxxxx
-----------------------------------
Xxxxxx X. Xxxxxxxx, Member
Address for Notices:
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
c/x Xxxxxxx Hole Mgt. Co.
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