AFTER THE ENDORSEMENT OF THIS NOTE AS HEREIN PROVIDED, THIS NOTE MAY NOT BE
ASSIGNED, PLEDGED, ENDORSED OR OTHERWISE TRANSFERRED EXCEPT TO A SUCCESSOR OF
THE TRUSTEE UNDER THE TRUST INDENTURE REFERRED TO IN THE LOAN AGREEMENT REFERRED
TO HEREIN.
PROMISSORY NOTE
$7,000,000 November 21, 1996
--
FOR VALUE RECEIVED, CHESAPEAKE BIOLOGICAL LABORATORIES, INC., a Maryland
corporation (the "Borrower"), by this promissory note promises to pay to the
order of THE MARYLAND INDUSTRIAL DEVELOPMENT FINANCING AUTHORITY, a body
corporate and politic and a public instrumentality of the State of Maryland (the
"Issuer") the principal sum of SEVEN MILLION and No/100 Dollars ($7,000,000)
which principal amount shall be due and payable in 80 consecutive quarterly
installments on the first Business Day of each February, May, August and
November, commencing the first Business Day of November, 1998, as more
specifically set forth below:
PAYMENT PAYMENT PAYMENT PAYMENT PAYMENT PAYMENT
DATE* AMOUNT DATE* AMOUNT DATE* AMOUNT
------------------------------------- ---------- ------------------ ---------- ------------------ ---------
November, 1998....................... $ 155,000 August, 2005 $ 150,000 May, 2012 $ 25,000
February, 1999....................... 155,000 November, 2005 150,000 August, 2012 25,000
May, 1999............................ 155,000 February, 2006 150,000 November, 2012 25,000
August, 1999......................... 155,000 May, 2006 150,000 February, 2013 25,000
November, 1999....................... 155,000 August, 2006 150,000 May, 2013 25,000
February, 2000....................... 155,000 November, 2006 150,000 August, 2013 25,000
May, 2000............................ 155,000 February, 2007 150,000 November, 2013 20,000
August, 2000......................... 155,000 May, 2007 150,000 February, 2014 20,000
November, 2000....................... 155,000 August, 2007 150,000 May, 2014 20,000
February, 2001....................... 155,000 November, 2007 150,000 August, 2014 20,000
May, 2001............................ 155,000 February, 2008 150,000 November, 2014 20,000
August, 2001......................... 155,000 May, 2008 150,000 February, 2015 20,000
November, 2001....................... 155,000 August, 2008 150,000 May, 2015 20,000
February, 2002....................... 155,000 November, 2008 25,000 August, 2015 20,000
May, 2002............................ 155,000 February, 2009 25,000 November, 2015 20,000
August, 2002......................... 155,000 May, 2009 25,000 February, 2016 20,000
November, 2002....................... 155,000 August, 2009 25,000 May, 2016 20,000
February, 2003....................... 155,000 November, 2009 25,000 August, 2016 20,000
May, 2003............................ 155,000 February, 2010 25,000 November, 2016 20,000
August, 2003......................... 155,000 May, 2010 25,000 February, 2017 20,000
November, 2003....................... 150,000 August, 2010 25,000 May, 2017 20,000
February, 2004....................... 150,000 November, 2010 25,000 August, 2017 20,000
May, 2004............................ 150,000 February, 2011 25,000 November, 2017 20,000
August, 2004......................... 150,000 May, 2011 25,000 February, 2018 20,000
November, 2004....................... 150,000 August, 2011 25,000 May, 2018 20,000
February, 2005....................... 150,000 November, 2011 25,000 August, 2018 20,000
May, 2005............................ 150,000 February, 2012 25,000
------------------------
* The Payment Date shall be the first Business Day of each of the months
listed.
The Borrower further agrees to pay interest on the unpaid principal amount
from the date of authentication and delivery of the Bonds (as defined in the
Loan Agreement referred to below) until the principal amount and all interest
thereon is paid in full which shall be paid on the first Business Day of each
February, May, August and November (the "Interest Payment Dates"), at the rate
of interest equal to the Variable Rate (as defined in the Indenture hereinafter
mentioned) or the Fixed Rate (as defined in the Indenture).
This Promissory Note is the "Note" referred to in the Loan Agreement dated
as of November 1, 1996 (the "Loan Agreement"), between the Borrower and the
Issuer and is entitled to the benefits thereof and subject to the conditions
thereof. Terms not otherwise defined herein shall have the definitions set forth
in the Loan Agreement.
Under the Loan Agreement, the Issuer has loaned to the Borrower the proceeds
received from the sale of the Issuer's $7,000,000 Maryland Industrial
Development Financing Authority Economic Development Revenue Bonds (Chesapeake,
Biological Laboratories, Inc. Facility), 1996 Issue, dated as of the date hereof
(the "Bonds"). The Bonds have been issued, concurrently with the execution and
delivery of this Note, pursuant to, and are secured by, the Trust Indenture
among the Issuer, First Union National Bank of Virginia, as Trustee (the
"Trustee") and Branch Banking and Trust Company, as Credit Facility Trustee (the
"Credit Facility Trustee") dated as of November 1, 1996 (the "Indenture"). The
Bonds bear interest at the Variable Rate prior to the Conversion Date (as
defined in the Indenture) and at the Fixed Rate on or subsequent to the
Conversion Date. Such interest is payable on the Interest Payment Dates. This
Note shall bear interest at the Variable Rate and the Fixed Rate during the same
periods as such rates are borne by the Bonds.
Each payment of principal of and interest on this Note will be sufficient to
enable the Issuer to pay when due the total amount of principal of (whether at
maturity, upon acceleration or otherwise), premium, if any, and interest on the
Bonds. To the extent that principal of, premium, if any, or interest on the
Bonds shall be paid, there shall be credited against unpaid principal of or
interest on this Note, as the case may be, an amount equal to the principal of
or interest on the Bonds so paid. The principal of, premium, if any, and
interest on this Note are payable in immediately available funds of any coin or
currency of the United States of America which on the respective dates of
payment thereof shall be legal tender for the payment of public and private
debts.
In addition, the Borrower agrees to pay when due in immediately available
funds all other amounts at the time the Issuer may be required to pay the same
pursuant to the Bonds or the Indenture.
The obligation of the Borrower to make the payments required hereunder shall
be absolute and unconditional without any defense, recoupment or right of
set-off by reason of any default by the Issuer under the Loan Agreement or for
any other reason.
Upon the occurrence of an Event of Default specified in the Loan Agreement,
the unpaid principal hereof and accrued interest and additional interest hereon
may become forthwith due and payable as provided in the Loan Agreement, and in
the event the Borrower
2
shall fail to pay any amount required to be paid under this Note when due, the
Borrower shall pay interest on such amount at a rate per annum equal to the
Overdue Rate (as defined in the Loan Agreement) or the maximum rate permitted
by law, whichever is lower.
The Borrower may at its option, and may under certain circumstances be
required to, prepay all or any part of the unpaid principal of this Note upon
the terms provided in the Loan Agreement.
UPON THE OCCURRENCE OF AN EVENT OF DEFAULT, THE BORROWER AUTHORIZES THE
CLERK OR ANY ATTORNEY DESIGNATED BY THE BANK, MIDFA OR ANY CLERK OF ANY COURT
OF RECORD TO APPEAR FOR IT IN ANY COURT OF RECORD AND CONFESS JUDGMENT
AGAINST IT WITHOUT PRIOR HEARING, IN FAVOR OF THE BANK OR MIDFA FOR AND IN
THE AMOUNT EQUAL TO SUCH OF THE OBLIGATIONS OF THE BORROWER WHICH HAVE BEEN
DUE AND PAYABLE UNDER THE PROVISIONS OF THIS NOTE, PLUS INTEREST ACCRUED AND
UNPAID THEREON, ALL OTHER AMOUNTS THEN DUE AND PAYABLE HEREUNDER, COSTS OF
SUIT AND AN ATTORNEY'S FEE IN AN AMOUNT EQUAL FIFTEEN PERCENT (15%) OF SUCH
OBLIGATIONS PLUS ALL ACCRUED AND UNPAID INTEREST THEREON, PROVIDED, HOWEVER,
(A) IF THE ACTUAL ATTORNEY'S FEES INCURRED BY THE BANK OR MIDFA ARE LESS THAN
15% OF SUCH OBLIGATION (PLUS ALL ACCRUED AND UNPAID INTEREST THEREON), THE
BANK OR MIDFA WILL REFUND (TO THE EXTENT ACTUALLY COLLECTED) TO THE BORROWER
AN AMOUNT EQUAL TO THE DIFFERENCE BETWEEN 15% OF SUCH OBLIGATION (PLUS ALL
ACCRUED AND UNPAID INTEREST THEREON) AND THE AMOUNT OF SUCH ACTUAL ATTORNEY'S
FEES (AFTER ALL OF SUCH OBLIGATIONS HAVE BEEN PAID IN FULL), OR (B) IF THE
ACTUAL ATTORNEY'S FEES INCURRED BY THE BANK OR MIDFA OR OTHER HOLDER HEREOF
EXCEED 15% OF SUCH OBLIGATIONS (PLUS ALL ACCRUED AND UNPAID INTEREST THEREON,
WHETHER BY REASON OF JUDGMENT BEING CONTESTED OR OTHERWISE, THE BORROWER WILL
PAY TO THE BANK OR MIDFA ON DEMAND THE AMOUNT OF ANY SUCH EXCESS. THE
AUTHORITY AND POWER TO APPEAR FOR AND ENTER JUDGMENT AGAINST THE BORROWER
SHALL NOT BE EXHAUSTED BY ONE OR MORE EXERCISE THEREOF, OR BY ANY IMPERFECT
EXERCISE THEREOF, AND SHALL NOT BE EXTINGUISHED BY ANY JUDGMENT ENTERED
PURSUANT THERETO. SUCH AUTHORITY AND POWER MAY BE EXERCISED ON ONE OR MORE
OCCASIONS, FROM TIME TO TIME, IN THE SAME OR DIFFERENT JURISDICTIONS. AS
OFTEN AS THE BANK OR MIDFA SHALL DEEM NECESSARY OR DESIRABLE, FOR ALL OF
WHICH THIS NOTE SHALL BE A SUFFICIENT WARRANT.
The Borrower hereby promises to pay all costs of collection, including
reasonable attorneys' fees and disbursements, without regard to any statutory
presumption, in the case of a default under this Note or the Loan Agreement. The
Borrower hereby waives presentment, protest and notice of protest or dishonor.
This Note shall be construed in accordance with the laws of the State of
Maryland.
3
IN WITNESS WHEREOF, the Borrower has caused this instrument to be executed
in its corporate name by its duly authorized officers and its corporate seal to
be affixed hereto all as of the date first above written.
CHESAPEAKE BIOLOGICAL LABORATORIES, INC.
ATTEST:/WITNESS
/s/ XXXX X. XXXXXXX By: /s/ XXXX X. XXXXX, III
----------------------------- ----------------------------------------
Treas/CFO Xxxx X. Xxxxx, III, President
---------
Secretary
(CORPORATE SEAL)
4
ENDORSEMENT
Pay to the order of First Union National Bank of Virginia, as Trustee for
the benefit of the Bondholders under the Trust Indenture dated as of November 1,
1996, between the Issuer, the Trustee and Branch Banking and Trust Company, as
Credit Facility Trustee, without recourse. This endorsement is given and made
without any warranty as to the authority and genuineness of the signature of the
maker of the foregoing Promissory Note.
This the 21st day of November, 1996.
----
MARYLAND INDUSTRIAL DEVELOPMENT
FINANCING AUTHORITY
By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------
Title: Chairman
---------------------------
